Ensuring the Safety of Advanced Driver Assistance Systems (ADAS) in Automobiles as We Head Towards an Autonomous Future

Abstract

My team and I were approached by a client looking to assess the feasibility of providing value-added services to help the automotive aftermarket continue to thrive in the rapidly changing automotive industry. Currently, there is a large problem in the automotive aftermarket repair industry to safely return vehicles equipped with Advanced Driver Assistance Systems (ADAS – cruise control, lane keep assist, backup cameras, etc.) to the road. Industry growth is expected to explode as cars become more advanced and more reliant on ADAS, presenting a tremendous opportunity for the automotive aftermarket to thrive in the future if they can adapt now. We started the current state analysis by determining the total addressable market. By 2030, it is estimated that there will be $1.09B of annual revenue earned from ADAS parts in the U.S. While this is great news, after surveying 450 collision and repair shops, we found that only about 20% of total shops will service ADAS. Specifically, only about 7% of small mechanical shops service ADAS. The three primary reasons for this are 1. many independent shops can't afford the necessary equipment to profitably perform services on these vehicles right now, 2. shops don’t have the demand to justify the cost, and 3. ADAS service to too difficult for technicians to learn. As a result, aftermarket shops not only miss out on revenue since they are forced to turn away customers and send them to name-brand dealerships, but they are also hurting their future potential for success. Additionally, we looked at consumer behavior and discovered that a large majority of consumers turn off ADAS on their cars. Those who use ADAS were concerningly found to drive less safe when they do so. Three problem areas were identified from the current state: the cost of ADAS repairs, the shop competency in ADAS service, and the consumer usage of ADAS-enabled vehicles. My team and I then used the Competing Value Framework to analyze these target areas and develop recommendations for our client. Our first recommendation for the client is to pursue an initiative that mandates regular ADAS system inspection. Doing so will keep consumers safe and drive more demand to the aftermarket. Our second recommendation for the client is to develop a certification program that is accessible, noticeably beneficial to the technicians, and integrates better into their work-life environment. Doing so should help more technicians and shops to gain the skills necessary to service the increased ADAS service demand. Our third recommendation is for the client to lobby for regulations so consumers cannot turn off ADAS systems. We believe that this regulation is necessary, or the safety capabilities of ADAS may never fully be realized. These recommendations will help the client position the automotive aftermarket to thrive for years to come.