This is how auto makers and startups are teaming up to bring out biggest, innovative ideas

Two years ago, automobiles and startups seemed to be two different things as the former is all about precision, testing and minute engineering, while startups are all about innovations, ideas and implementation, pursuing their entrepreneurial dreams. Then came Tesla, the automobile startup, and redefined how people looked at automobile sector with its electric cars. Tesla is disrupted the segment, came out with the idea of self driving cars. Tesla proved to be the wakeup call for automobile sector and they realized that they will have to let go off their traditional ways.

A tide of change was seen recently when a number of startups partnered with car makers. Leading automobile manufacturer like BMW, Ford, General Motors and Daimler etc have partnered with tech-startups. These startups are reshaping the automobile sector by devising driver monitoring systems, ride share with drivers with food on the go any many other things.

"The traditional automakers are hardwired to think conventionally and hence find it difficult to be agile and responsive in today's digital and connected age,” says Hormazd Sorabjee, editor, Autocar India.

This trend seemed to have hit Indian automobile sector too. Tata Motors is engaged with half a dozen startups and looking forward to partnering with another 20. It is already in partnership with a startup called Mobiliya which allows driver to add music to the main playlist.

"There is so much opportunity in this space that auto companies cannot expect to cover it all internally or using their existing procedures. Therefore working with startups can help achieve a much faster market entry for innovations,” Tim Leverton, Head-Advanced and Product Engineering, Tata Motors, told ET.

Mahindra has also invested into a startup called ScootNetwork, an urban mobility solutions provider based in San Francisco. Toyota Kirloskar has partnered with Ola and Uber.

Vikram Kirloskar, vice-chairman of Toyota Kirloskar said that automobile makers have long-standing legacies in their research and development centres which sort of make it difficult for them to think out-of-the box. "They need fresh ideas and start-ups are a good place to hunt,” he said.

Uber already has many self driving cars that have sensors and computer that can drive the car pretty good on autopilot. Driven by software, connectivity and the service (sharing) economy, hi-tech startups are willing to take big risks and finding the automobile industry promising as compared with other sectors, says Abdul Majeed, partner, automotive, PwC.

According to a report by the research firm Bloomberg New Energy Finance, future cities might run on on shared fleets of electric and auto-driving cars.

Roland Folger, MD & CEO, Mercedes-Benz India, said that Daimler is playing a crucial role in return of the startup spirit, the same spirit on which the company was built 130 years ago.

"Pactris, app was released as an in-house startup at Daimler together with the Smart Lab, which serves as the brand's thinktank for quick implementation of creative projects. On the one hand, we are strong in traditional values and on the other hand modern, flexible and ready for the challenges of digitization,” he said.


Indian car makers are looking towards innovation rather than partnerships. Mahindra, for example, is looking in-house to kickstart a startup ecosystem. Mahindra’s Farm Equipment Sector has forayed into the equipment rental services with the launch of TRRINGO.

“The disruption in the way consumers will access mobility in the future is already happening. The challenge for automakers is to not only react to this but leverage their significant strengths to innovate and meet future customer demands,” says Tata Motors' Leverton.
(image: Indiatimes)