Voice of Customer: In-Car Services and Features, Passenger Vehicles, China, 2024

Table of Contents

Project Approach & Key Findings

• Project Approach
• Key Findings

Industry Overview

• Software is Integral to Delivering the Future of Mobility
• "CASE is Dead, Long Live the SDV!"
• We are Right at the Start of the SDV Journey
• OEM-Operated Digital Ecosystems to Support Features on Demand
• Frost & Sullivan Observes 3 Distinct OEM Approaches to Offering Features on Demand Today

Research Objectives and Methodology

• Research Methodology
• China Sample

Sample Characteristics

• Respondent Profile: Demographics
• Respondent Profile: Household Characteristics
• Respondent Profile: Vehicle Ownership and Driving
• Vehicle Characteristics: Engine and Vehicle Segment

Experience and Attitudes Toward Vehicles

• Interest in Innovative New Technologies in Cars is High
• Majority of Customers 56% See a Digital and Connected Car as the Strongest Vision of the Future
• Consumers in Shanghai have the Most Futuristic Vision of the Car of the Future Compared to Other Cities
• Drivers of Small and Mid-size SUVs Lead in their Vision of the Future Vehicle as a "Smartphone on Wheels"
• Large Discrepancy Between Owners of Different Vehicles and their Vision of the Future Car
• Almost Half of Customers Want a Car with Advanced Applications
• BMW and Ford Owners have the Highest Expectations for In-Car Technology
• 65% of Customers are Very or Extremely Interested in In-Vehicle Connected Services
• There is a Steep Decline in Interest in Connected Services in Chongqing
• Interest in In-Vehicle Connected Services Varies Widely Based on Consumers' Interest in Technology
• The Most Interested Age Demographics in Connected Car Services are Those Aged 26-40 and 41-60
• Sharing Driving Data with Third Parties is Less of a Concern in China-Only 6% Would Definitely Not Share
• Large SUV Owners have the Least Concerns Over Sharing Driving Data
• The Most Popular In-Car Activity is Listening to Music and Using Maps for Navigation
• After Music Streaming, Video Streaming and Built-In Navigation are the Next Most Popular Functions
• Services/Functions Regularly Used Show City-Level Differences
• Volkswagen Users Say They Use Services/Functions Within the Vehicle Significantly Less than Other Vehicle Owners
• Close to One-Third of Drivers Use in-Car Monitoring Features Today
• Drivers in Shanghai Use In-Car Monitoring Features the Most Today
• Voice Assistants in the Car are Used Most to Search Routes or for Calls/Texts
• Using a Voice Assistant to Call/Text a Person is the Most Popular Feature in Shanghai Top City for Voice Assistant Usage
• 44% of Respondents Use Over-the-Air OTA Updates Regularly
• Only 33% of Respondents in Chongqing Regularly Use OTA Updates
• Basic and Subcompact Drivers Use OTA Updates the Most Frequently
• Consumers with Kids Under 6 Most Regularly Install New In-Car Services via OTA Updates
• Huge Differences in OTA Usage Exist Between Brands in China
• Small and Mid-Size SUV Owners are the Biggest Segment of Consumers That Have Paid to Unlock Features on Demand
• Shanghai has the Highest % of Consumers that Have Used Features on Demand

In-Car Marketplace

• Nearly 80% of Consumers are Very Comfortable or Comfortable in Making Online Payments
• Respondents in Shanghai and Beijing have the Highest Levels of Comfortability
• 93% of Large SUV Drivers are in the 2 Highest Groups in Level of Comfort
• Tesla Owners are Most Comfortable in Making Online Payments Via a Smart Device
• Interest in Paying for Services on the Go is High
• Drivers of Large SUVs have the Highest Interest in Paying On the Go
• Tolls are the Most Preferred Service to be Paid for via In-Car Payment Functionality
• Ford, BAW, and Acura Owners Show the Highest Interest in Paying via In-Car Functionality
• There are Big City-Level Differences in Attitude Toward Making Purchases via an In-Car Marketplace
• Interest Levels in Services to Install via In-Car App Stores Vary by City-Shanghai Respondents Exhibit the Highest Interest
• There is a Large Difference Between Owners of Vehicle Brands for Interest in Installing Apps

Software-Defined Vehicle: Awareness and Interest

• Only 40% of Those Surveyed have Heard of SDVs
• BEV Owners have the Highest Awareness of the SDV
• Drivers of Large SUVs have the Strongest Awareness of SDV
• Awareness of SDV Varies Widely by Drivers of Different OEM Brands
• Attitudes Toward the Concept of SDV are Very Positive
• SUV Owners Like the Idea of the SDV the Most
• Respondents with Kids Under 6 Have the Most Positive Outlook Toward Using SDVs
• Ford and Tesla Owners Like the Idea of Using an SDV the Most Out of All Vehicle Owners
• Improved Safety Features are Viewed as the Most Desired SDV Benefit, But Other Features are Seen as Equally Important

Features on Demand: Consumer Perspectives

• Features on Demand Introduction in Survey
• 26 Features on Demand Tested
• 73% of Consumers are Willing to Pay for Additional Features
• Willingness for Post-Purchase On-Demand Vehicle Features is Highest Among Large SUV Owners
• Willingness for Post-Purchase On-Demand Vehicle Feature Upgrades
• Safety and Security, as well as ADAS and Autonomous, are Categories for Which Consumers are Most Likely to Pay Additional Fees
• Likelihood to Pay Additional Price for Services to Improve In-Vehicle Experience by Province
• Likelihood to Pay Additional Price for Services to Improve In-Vehicle Experience
• Driver and Interior Monitoring Systems and AR-HUD Hold the Highest Interest for Consumers
• Likelihood to Purchase Features on Demand in the Next Car
• Close to 9 in 10 Consumers are Seen as Prospects for Features on Demand
• Regional Variances for Features on Demand are Sizeable
• Drivers of Large SUVs Display the Most Interest in Features on Demand
• Respondents with BEVs Indicate Higher Interest than ICE Owners
• Respondents Under 61 Years Hold the Greatest Interest in Features on Demand
• Higher Educated Customers are More Likely to Purchase Features on Demand
• Interest in Features on Demand

Willingness to Pay and Price Elasticity of Demand

• Price Points Tested
• Willingness to Pay and Price Elasticity of Demand
• Features on Demand Price Elasticity of Demand
• Interest in Purchasing: Adaptive Driving Sounds and Lighting
• Interest in Purchasing: Cinema Sound Experience
• Interest in Purchasing: Personalized Sound Zones
• Interest in Purchasing: Premium Audio
• Interest in Purchasing: User Profiles
• Interest in Purchasing: Driver and Interior Monitoring System
• Interest in Purchasing: AR-HUD
• Interest in Purchasing: Car2Home and Home2Car Functionality
• Interest in Purchasing: In-Car Karaoke
• Interest in Purchasing: 2D, 3D, and AR Navigation
• Interest in Purchasing: Powertrain Upgrade
• Interest in Purchasing: Sentry Mode
• Only 6% of Chinese Drivers Said They are Not Very Likely to Pay for Features on Demand in a Future Vehicle

Features on Demand: User Experience

• Safety and Security Sees the Highest Historical Features on Demand Purchasing Throughout China
• Categories of Features on Demand Purchased in the Past
• The Most Popular Way to Find Out About Features on Demand is through OEMs
• Satisfaction with Purchased Features on Demand is High
• Features on Demand Meeting Consumer Expectations
• Small and Mid-Size SUVs Represent the Largest Group of Features on Demand Users
• The Ability to Improve the Vehicle's Safety is the Most Appreciated

Next Car Purchase

• PHEVS are Poised for the Biggest Rise Between Current and Future Vehicles
• Almost One-Third of Respondents Would Consider a BEV for their Next Vehicle
• Likelihood to Consider Type of Engine for Next Vehicle
• 25% of Respondents Say They Will Most Likely Purchase C Segment Vehicles Next
• Price Respondents Expect to Pay on Next Vehicle Purchase
• Average Duration of Car Ownership

Appendix

• Growth Opportunities Fuel the Growth Pipeline Engine
• Why is it Increasingly Difficult to Grow?
• The Strategic Imperative 8

Next Steps

• Benefits and Impacts of Growth Opportunities
• Next Steps
• List of Exhibits
• Legal Disclaimer