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Value Creation for Intelligent Connected Vehicles: An Industry Value-Chain Perspective

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Digital Business Models

Abstract

Disruptive technology innovations and changing consumer needs are transforming the core of the automotive industries. This chapter discusses the value creation for intelligent connected vehicles (ICVs) by using an industry value-chain perspective. The study proposes an analytical framework of new value creation points on the demand side and supply side of the ICV value chain. The frame can be used by automakers to rethink their digital innovation strategies based on a full spectrum of value creation points. Drawing insights from the auto innovation hub West Sweden region, the chapter provides the latest empirical observations and reflections on this timely topic. Value creation logic on the demand side is shifting toward the network effect, long tail effect, and multi-sided platforms (MPS), and on the supply side the industry is witnessing an increasing degree of horizontal integration that is supported by open innovation and innovation ecosystem strategies. Future automakers are transforming from vehicle producers to system and service platform integrators. The future auto leaders will be successful orchestrators of innovation ecosystems.

Great technological achievements commonly fail commercially because little attention has been given to designing a business model to take them to market properly. This can and should be remedied.

David J. Teece (2010: 192)

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Notes

  1. 1.

    Source: https://www.businessregiongoteborg.se/en/focus-areas/automotive-and-transport (Retrieved March 17, 2018).

  2. 2.

    Source: http://global.geely.com/2018/03/16/geely-auto-launches-2018-bo-yue-suv-with-leading-gkui-interface/ (Retrieved March 31, 2018).

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Authors and Affiliations

  1. Department of Business Administration, School of Business, Economics and Law, University of Gothenburg, Gothenburg, Sweden

    Xiangxuan Xu

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  1. Xiangxuan Xu
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Correspondence to Xiangxuan Xu .

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  1. Aarhus University, Risskov, Denmark

    Annabeth Aagaard

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Xu, X. (2019). Value Creation for Intelligent Connected Vehicles: An Industry Value-Chain Perspective. In: Aagaard, A. (eds) Digital Business Models. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-96902-2_3

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