Digital Transformation of Primarily Physical Industries - Exploring the Impact of Digital Trends on Business Models of Automobile Manufacturers

Abstract

Abstract. The phenomenon of digital transformation received some attention in previous literature concerning industries such as media, entertainment and pub-lishing. However, there is a lack of understanding about digital transformation of primarily physical industries, whose products cannot be completely digitized, e.g., automotive industry. We conducted a rigorous content analysis of substan-tial secondary data from industry magazines aiming to generate insights to this phenomenon in the automotive industry. We examined the impact of major dig-ital trends on dominant business models. Our findings indicate that trends relat-ed to social media, mobile, big data and cloud computing are driving automo-bile manufactures to extend, revise, terminate, and create business models. By doing so, they contribute to the constitution of a digital layer upon the physical mobility infrastructure. Despite its strong foundation in the physical world, the industry is undergoing important structural changes due to the ongoing digitali-zation of consumer lives and business.