The impact of digitalization on traditional business models in the automotive industry

The development from an industrial society to a digital society is ongoing, where digitalizationis an engine of development. Digitalization accelerates the necessity of developing traditional business models within organizations. Digitalization also has an impact on organizations and its development through the consumers. The needs of consumers have increased the pressure on organizations to establish new approaches to strategies, business flows and processes. The press to perform and develop has been particularly noted in the automotive industry. Organizations need to re-evaluate consumer needs and create digital business models that take advantage of new opportunities to generate competitiveness. Established organizations must act based on the changes generated by the new technology by updating and improving their traditional business model. In the event of failure, the organization risks being replaced by a competitor who is "faster" and "more efficient" in implementing significant innovations in their digital business model. The entire automotive industry is undergoing a trend that focuses on enhancing the use of digital solutions in a previously mechanically dominant industry. The purpose of the bachelor’s thesis is to investigate the impact of digitalization on traditional business models in the automotive industry. Other industries than the automotive industry are not affected by the study presented in this thesis in order not to risk the validity, transferability and reliability of the thesis. The thesis aims to treat the organization Volvo Cars and their work towards digitalization. A quality data collection method has been used as primary data when designing the empirical research at Volvo Cars to enable vicinity to the interviewee. Vicinity to the interviewee enables objectivity and understanding for the reality that is being studied. The study's conclusion shows that as a result of digitalization, organizations in the automotive industry need to increase the flexibility, reactivity and product individualization in order to create added value for the consumer through the implementation of digital solutions. The consumer is the main reason behind the digitalization and has the greatest impact on an organization's digital design