Electric and Autonomous Vehicles Go Mainstream on Super Bowl Sunday

As the Kansas City Chiefs fought to a thrilling come-from-behind victory in Super Bowl LIV on Sunday, a series of high-profile television commercials announced that electric and autonomous vehicles are no longer mere designs on the drawing board. Rather, these technologies have arrived and are poised to radically transform the automotive industry.

Audi extolled the virtues of its e-tron electric Sportback crossover to the tune of “Let It Go” from the Disney movie Frozen and urged consumers to embrace the “more sustainable” future of electric vehicles (EVs). The GMC Hummer EV, an electric truck capable of generating 1000 hp, 11,500 pound-feet of torque and speeds of 0-60 in 3 seconds, was introduced, while Porsche put EVs in the performance sports car market with a commercial featuring its battery powered Taycan Speedster. Not to be outdone by EVs, autonomous vehicle technology made a humorous and impressive appearance in Hyundai’s “smaht pahk” ad featuring a remote smart parking assist capability. These technologies are mainstream and here to stay.

So, what does all of this mean for the auto industry? It means that change is happening “Fast and Furious,” just like the ad on Sunday for the latest installment of that storied movie franchise. In the coming years, the industry will face a number of challenging issues, including:

• With far fewer moving pieces, electric vehicles are projected to generate much less warranty and service work for dealers. How will that change impact dealer revenue and profitability?
• We expect our smart phones to be updated automatically overnight. Will traditional auto manufacturers be able to offer to consumers the same kind of technology service and experience given state dealer laws?
• Many consumers now want and demand an online shopping experience. Will traditional OEMs and new industry entrants be able to compete effectively with Tesla for consumers demanding that experience? The recent settlement between Tesla and Michigan highlights the challenges created by state laws prohibiting online and direct sales.
• A recent Bloomberg article projected EV and combustion engine price parity by 2024, a critical step to the EV evolution. But what about “convenience” parity in terms of charging infrastructure? Will a growing demand for EVs be the impetus for a standard protocol for EV charging interfaces and an increase in the EV charging infrastructure?
• How will changes in consumer preferences regarding mobility impact the overall demand for private ownership? How can OEMs and dealers respond and adapt to what some project to be a shrinking private ownership pie?
• Advances in technology mean more and more consumer data is being collected. How can OEMs monetize that data and information while still protecting consumer privacy expectations?
• How can the entire automotive industry move forward efficiently under what some have argued are old and outdated state dealer laws?

These are just a few of the issues established manufacturers and new entrants must confront in today’s evolving automobile industry, and Seyfarth’s Future of Automotive Task Force is tracking these and other issues to help clients navigate these challenging times.

John Skelton is co-chair of Seyfarth Shaw’s Franchise and Distribution Practice Group and a thought leader in the firm’s Future of Automotive Task Force.