To meet the demands of today’s consumers, smart automotive enterprises are driving an interdependent ecosystem that will

1. George Mattathil -
4/12/2011
Let’s Build a Smarter Planet:
Automotive
© 2010 IBM Corporation

2. Building a smarter planet: Automotive
The reality of living in a globally integrated world is upon us.
 Economic downturn and increased industry upheaval.
 Empowered consumers with rising product/service expectations.
 Complex and globally dispersed operations.
 Vehicles becoming digitally connected.
 Increasing awareness and regulation regarding sustainability.
 Growing role of emerging economies and markets.
The world is connected:
economically, socially and technically.
© 2010 IBM Corporation

3. Building a smarter planet: Automotive
The need for progress is clear.
37 $120 $13
million billion billion
Metric tons of CO2 Annual cost of Cost of U.S.-based
emissions from vehicles in congested roadways in automotive warranty
the U.S. each year. the form of lost hours claims in 2008.
and wasted gas in
Japan alone.
© 2010 IBM Corporation

4. Building a smarter planet: Automotive
The opportunityfor progress is clear.
50% 20% less 90% reduction
improvement in traffic in vehicle
fuel efficiency misdiagnosis
Sustainable vehicles: Traffic system: Efficient enterprise:
Global supplier Stockholm, Sweden European OEM
A global supplier recently The city cut traffic by IBM and a European OEM
developed a new hybrid 20%, lowered emissions implemented a new diagnostic
hydraulic system—which by 12% and reported system combining symptom
promises dramatic fuel 40,000 additional daily probability with code analysis.
savings and environmental users of public Warranty costs were reduced
benefits—to replace the transportation. significantly, while customer
conventional drivetrain satisfaction increased—because
and transmission. 90% of vehicle failures are
diagnosed in a first-pass analysis
in less than 15 minutes.
© 2010 IBM Corporation

5. Building a smarter planet: Automotive
To meet the demands of today’s consumers, smart automotive
enterprises are driving an interdependent ecosystem that will…
CREATE SUSTAINABLE ADAPT BUSINESS MODELS
VEHICLES WITH INTELLIGENT VEHICLES
Apply new and emerging Open new revenue streams and
technologies to reduce carbon attract customers with increased
emissions through electrification AUTOMOTIVE connectivity, new sensing
and alternative fuels while ENTERPRISE capabilities, improved safety
ensuring recyclability and mechanisms, active maintenance
reducing environmental impact. systems and more.
TRANSFORM THE VALUE CHAIN
Achieve greater operational efficiencies and
support an increasingly global workforce as
an integrated enterprise. Reduce fixed costs
and increase flexibility.
© 2010 IBM Corporation

6. Building a smarter planet: Automotive
+ + =
An opportunity for automotive enterprises
to think and act in new ways.
Create Adapt business Transform the
sustainable models with value chain.
vehicles. intelligent
vehicles.
© 2010 IBM Corporation

7. Building a smarter planet: Automotive
Smart automotive:
Creating sustainable vehicles.
SMART IS
Creating advanced software for intelligent
control and power management in electric
vehicles and hybrid powertrains.
SMART IS
Collaborating across industries to
develop an ecosystem that will enable
widespread electric vehicle usage.
© 2010 IBM Corporation

8. Building a smarter planet: Automotive
Smart automotive:
Creating sustainable vehicles.
Global supplier: Developed new fuel-saving
transmission component using software modeling
and code generation tools to speed development
and improve quality and safety.
European collaboration project: Developing an
intelligent infrastructure that will make possible the
large scale adoption of electric vehicles powered
by sustainable energy.
© 2010 IBM Corporation

9. Building a smarter planet: Automotive
Smart automotive:
Adapting business models with intelligent vehicles.
SMART IS SMART IS
Leveraging massive amounts of data to Bringing the power of connectivity into
offer high-quality services to drivers. the vehicle to help find parking, avoid
traffic jams and locate convenient
services tailored to user preferences.
SMART IS
Integrating with intelligent traffic systems
to support congestion management and
carbon reduction initiatives.
© 2010 IBM Corporation

10. Building a smarter planet: Automotive
Smart automotive:
Adapting business models with intelligent vehicles.
Intelligent Driving Services Provider: Collects Fleetboard: Equipped fleet with telematics units reducing
information from a multitude of sources all the time, operating costs ~5% through reduced fuel consumption,
including thousands of static sites, number plate increased availability, lower labor charges and more.
recognition cameras, and 80,000 of their customers’
black boxes, providing real time information on what’s
happening on the roads.
Stockholm, Sweden: An intelligent toll system in
the city center resulted in 20% less traffic, 40% lower
emissions and 40,000 additional users of the public
transportation system.
© 2010 IBM Corporation

11. Building a smarter planet: Automotive
Smart automotive:
Transforming the value chain.
SMART IS SMART IS
Using advanced analytics and real-time Managing material flow through
tracking to integrate logistics across the the factory in real time to support
value chain. just-in-time manufacturing.
SMART IS SMART IS
Creating better service tools to diagnose Precisely identifying vehicles or
problems correctly the first time or to predict subassemblies containing defective
failures before they occur. parts to enable more “surgical” recalls.
© 2010 IBM Corporation

12. Building a smarter planet: Automotive
Smart automotive:
Transforming the value chain.
Automotive OEM: Implemented RFID reusable Honda Italia: Implemented RFID Work in
container management system to increase supply Progress tracking solution to improve production
chain visibility and efficiency. efficiency and quality.
Automotive OEM: Implemented advance diagnostic Landmarks: Implemented an open, secure parts
system that reduced dealer misdiagnosis by more than tracking solution that enables parts traceability at
90% and dealer diagnostics time from 1 hour to 15 all levels of the supply chain allowing more
minutes. precisely targeted recalls.
© 2010 IBM Corporation

13. Building a smarter planet: Automotive
Traditionally, automotive enterprises have partnered with related
industries and entities to varying degrees.
Government
Insurance
Telecommunications
Energy Automotive
Electronics
Financial services
Academia
© 2010 IBM Corporation

14. Building a smarter planet: Automotive
Today’s smart automotive enterprise deepens these partnerships to
drive new insights and capabilities - and connects this collaborative
ecosystem directly to the consumer.
© 2010 IBM Corporation

15. Building a smarter planet: Automotive
The result? A unique ability to deliver new value and improved
lifestyle experiencesthat meet consumers’ evolving needs.
Fewer manual
New mobility operations
models
Increased safety
Greener
vehicles
Alternative financing
Better
service
Customizable
options
Responsible
manufacturing Connected
entertainment
© 2010 IBM Corporation

16. Building a smarter planet: Automotive
IBM’s solution strategy is aligned with the needs of the
automotive industry.
AUTO ENTERPRISES ARE FOCUSED ON… IBM IS INVESTING IN…
 Automotive systems and software delivery platform
 Global delivery for joint software development centers
Product development  Product development integration framework
 PLM implementation and value realization
 Complex controller simulation
 Global distribution network optimization / inventory optimization
 Supply chain performance
Supply chain and production  RFID solutions
 Manufacturing integration framework
 Enterprise Asset Management
 Plant launch services
Channel management  Dealer operations management
 Sales order and planning
 Advanced automotive banking
Captive finance operations  Customer retention and OEM integration
 Regulatory reporting and risk management
 Vehicle prognostics and diagnostics
Warranty and service  Warranty analytics
 Global warranty claims processing
 Spare parts management
 Planning
Telematics
 Secure Infrastructure
 Service Management
© 2010 IBM Corporation

17. Building a smarter planet: Automotive
We’ve only just begun to
uncover what is possible on
a smarter planet.
The world will continue to become smaller,
flatter and smarter. We are moving into the
age of the globally integrated and intelligent
economy, society and planet.
To thrive on a smarter planet, we need a
smarter automotive industry that supports
a profitable and growing value chain.
There’s no better time to start building. And
there’s no better time to invest in creating
the kind of industry we all need.
Let’s work together to drive real
progress in our world.
© 2010 IBM Corporation

18. Building a smarter planet: Automotive
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IBM Corporation 2011
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© 2010 IBM Corporation