The German automaker said it planned to invest more in smart self-driving techs and ride-sharing businesses so it can profit at the right time.
Over the past century, the automotive industry has been on a progressive but rather slow development path. This is no longer the case, as the technological advancement in recent years pushed the automakers to think outside the box. Just making and selling cars will not be sufficient enough in the near future from a healthy business point of view. This is why companies such as Uber are worth more than premium makers such as BMW. The ride-sharing affair, alongside the self-driving electric trend, is expected to account for nearly half of automotive profits in 15-20 years from now on, the biggest single source of money to be made.
Therefore, the companies that will manage to swiftly react “will dominate this market,” Klaus Froehlich, BMW head of development said in an interview in Munich, quoted by Bloomberg. “It’s a business proposition worth billions in profits that will cost billions to develop.” But in order to develop the smart cars of the future, carmakers have to eye and to partner with tech companies that have the proper know-how in the software area. “There’s a power play going on with other companies buying up software competencies at a fast clip,” Froehlich added. “We definitely need partners in this area, and we massively need to build out in-house resources too.”