General Motors says it expects to make $350 million (U.S.) in improved profits over the next three years thanks to connected cars, marking the first time an auto maker has made such projections public.
E-commerce transactions made through in-car systems, automatic ordering options with fast-food outlets and software updates that cut down on repair expenses will add up to this improved profitability, the company said in a recent presentation to investors.
All of these new revenue streams or cost savings will be made possible by 4G LTE OnStar wireless connectivity, which GM plans to roll out in the majority of its 2016 vehicles.
Analysts figure the company’s projections are actually on the low side. IHS believes GM could add about $439 million in profit over the same three-year time period, while Gartner thinks auto makers will be earning up to 10 per cent of their revenue from connected services by 2020. The firm also believes 80 percent of all cars will be connected by then.
General Motors says it expects to make $350 million (U.S.) in improved profits over the next three years thanks to connected cars, marking the first time an auto maker has made such projections public.
E-commerce transactions made through in-car systems, automatic ordering options with fast-food outlets and software updates that cut down on repair expenses will add up to this improved profitability, the company said in a recent presentation to investors.
All of these new revenue streams or cost savings will be made possible by 4G LTE OnStar wireless connectivity, which GM plans to roll out in the majority of its 2016 vehicles.
Analysts figure the company’s projections are actually on the low side. IHS believes GM could add about $439 million in profit over the same three-year time period, while Gartner thinks auto makers will be earning up to 10 per cent of their revenue from connected services by 2020. The firm also believes 80 percent of all cars will be connected by then.
MORE ABOUT SMART CARS AND GM:
- How to invest in the Internet of Things, without the hype
- People don’t need a Google wireless service, but robot cars do
- Is Tesla the next Ford?
- Google versus Uber is great news for the robot car business
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