Product Power Transformation in the Automotive Industry: Trends, Challenges, and Strategies

The automotive industry in 2024 is experiencing rapid growth with an increasing number of models and decreasing prices, creating intense competition that pushes manufacturers to seek breakthroughs through Integrated Product Development (IPD) and product‑power transformation.

This transformation goes beyond technology upgrades; it reshapes how cars are perceived, turning them into intelligent, emotionally resonant mobility partners that meet personalized user needs.

Key drivers include the need to focus on user experience, invest in emerging technologies such as AI‑enabled smart driving and smart cabins, reduce manufacturing costs via platform sharing, modularization, and new materials, and shift business models toward hardware‑pre‑installation with software subscription services.

Traditional OEMs often struggle with user‑demand perception, technology investment, cost control, and business‑model upgrades due to fragmented processes, lack of direct user channels, and siloed R&D efforts.

Case studies illustrate diverse approaches: Li Auto builds a user‑centric organization with a top‑down PDT structure and data‑driven design; Xiaomi applies its ecosystem expertise to create a “human‑car‑home” integrated experience; Geely leverages its Volvo acquisition to establish a central research institute, platform sharing, and modular product lines, while also exploring cost‑saving technologies like integrated casting.

ThoughtWorks proposes three transformation pathways—shallow (optimizing existing processes and user experience), middle (building cross‑functional teams with market and quality focus), and deep (restructuring strategy, organization, and culture)—to guide OEMs in implementing product‑power change.

In conclusion, sustained innovation, quality, and efficiency are essential for automotive firms to navigate evolving consumer expectations, technological advances, and competitive pressures, ensuring long‑term market success.