In Autonomous Age, Remanufacturing is Key

November 12, 2018

Automakers should design their vehicles to be remanufactured several times over their life. Registered vehicles will markedly drop as autonomous vehicles are employed eight to 10 hours per day vs. the legacy vehicle employment of one to two hours per day and 150,000 to 200,000 miles during a vehicle’s lifetime. As a result of retaining the legacy design, the provider of autonomous services will be required to replace vehicles every one to two years; depreciation would become the largest cost driver for the service provider.

OEMs should focus their energies on designing vehicles to be remanufactured, retain their ownership as a supplier to the service provider and perform the remanufacturing process, which will be a three to four times greater volume than new-vehicle production, which will drop by 70 to 80 percent. The profit margins for such a business model will exceed the current model by 100 to 200 percent.

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