Vehicle data access right has been at the centre of a long contention in the US, which seems to be settled as of now. What’s the situation in India?
The debate around the million-dollar question of “Who owns the vehicle data?” seems to have been settled, albeit for now.
In the recently concluded US Presidential elections, an amendment was passed which clarified if there were any doubts around access to vehicle data. This particular amendment, put to a ballot test in Massachusetts requires all vehicles sold in the state from 2022 to be equipped with standardized data platforms with open access.
The primary intention behind formalizing this is to allow aftermarket owners workshops to have unobstructed access to vehicle data. All the access to mechanical data accessed from the vehicles can then be used for running diagnostics through a variety of applications, including mobile diagnostics solutions enabled by wi-fi connections.
The need for an amendment primarily rose due to a contention raised in 2012, Massachusetts ‘Right to Repair Act’ which made it mandatory for car manufacturers to let the customers access vehicle data. The act allowed vehicle data to be retrieved from a vehicle OBD-II port. It did not clarify on wireless transmission of vehicle data and this became a long-standing point of contention- restricting not just the workshop access but also limited development of telematics-based solutions.
While the vehicle owners and aftermarket providers cheered on to the development, the automakers raised contention this particular part of the act posed a security risk to the owners. Even though the act that was passed in Massachusetts was eventually adopted nationwide in 2014, the contentions raised around wireless transmission have been a longstanding roadblock to the effective implementation of the act.
Fast forward to 2020, and Massachusetts through a ballot vote has been able to amend and address the contention raised all along. The intention is to give unhindered access to vehicle data to the owners and workshops. This access to mechanical vehicle data can then be used for running diagnosis from even a mobile-based application. This also includes the ability now to even send commands to the vehicles for diagnostics, repair and testing.
The road ahead to capitalize on the act
a) Vehicle testing, diagnostics and repair
Every single new vehicle model added to the vehicle parc is has the potential to incrementally increase the complexities around vehicle diagnostics and repair. This challenge is further aggravated for the independent aftermarket workshops who have limited access to OE data, thereby skewing the balance of competition largely in favour of the OE channel.
The act passed in 2014 promised to address this challenge, the most recent amendment only makes it more effective and paves the way for heightened access. At the back of this open access, there are numerous opportunities for developing applications and tools aimed at remote vehicle diagnostics- reasons to be excited about tools, equipment and technical solution providers with IoT applications.
b) New business models
The aftermarket service ecosystem will undoubtedly benefit from the access to data, this act can also be leveraged to develop new retail models- both vehicle service and replacement parts- any aftermarket stakeholder will vouch for the benefits of extended customer engagement.
As for today, there are numerous aftermarket telematics applications (eg. Pace Telematics GmbH which allows in-car payments) that access vehicle OBD II ports through dongle devices, and attain unhindered access that allows more effective diagnostics can enable a retail solution in place for promoting parts and services along with other diverse offerings.
Agreed that this is a vision of an ecosystem of the future for the vehicle aftermarket and therefore can take shape only if all the blocks set well together. Arguably, the OEMs have some merit in their case for protecting the data access citing security concerns and therefore customer vigilance alone may not be sufficient to protect vehicle information. This could require an industry body and of stringent data protection laws in place.
Having said that, and the likely nation-wide implementation of the recent amendment to follow- it does appear that the United States has been able to put to rest, for now, the debate about who owns and can access the data, potentially paving way for the aftermarket to innovate and gain ground in their competition with OEMs.
Vehicle data ownership debate and India
As for the competition in the Indian aftermarket, and with close to 44 million cars and light vehicle driving on the road, there are mightier challenges for the workshops to compete with the OE dealerships- skill-set gap, access to tools and equipment, and pieces of training are just some of them. Even with a fair share of the vehicle service market (45%) with the aftermarket workshops in India, the competition is largely in favour of the OE dealerships.
Furthermore the fact that newer vehicles equipped with latest technologies and elaborate electronics penetration pose a stiff challenge for aftermarket workshops to stand their ground and could be fighting a losing battle.
Any open access opportunity to vehicle data for the aftermarket workshops will go a long way in lifting the competitiveness of the entire market and eventually ensure the vehicle owners have a choice in hand which is theirs to make, and not dictated by the lack of ability from one party.
P.S. As of today, automakers body is preparing to challenge and block the most recent amendment, further highlighting how crucial it can be for their edge over the competition.
(Anuj Monga is the Global Research Manager – Aftermarket, Automotive & Transportation Practice at Frost & Sullivan. He was associated with International Tractors Ltd, Maruti Suzuki, LG Electronic India and Beroe Inc as well.)
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