Access to digital car data and competition in aftersales services

This study looks at car data markets from an economic perspective. We start from several options for the technical characteristics of data access points that have been discussed among stakeholders in the automotive industry. We examine the structure of data markets that are likely to emerge from these characteristics and the implications for the welfare of manufacturers, aftermarket service providers and drivers. Car manufacturers face competition in car markets and aftersales services. However, they can design the car data architecture to ensure their exclusive access to the data. That would give them a monopoly in the market for car data from their brand. They can use this to increase their leverage on aftersales services markets. Our baseline scenario is the Extended Vehicle proposal that manufacturers prefer. This ensures their data access monopoly and enables them to maximizes revenue from data and data-driven aftersales services. It reduces welfare for drivers and aftersales service providers. Two technical variations on the baseline scenario reduce manufacturers' leverage over data server governance and their monopolistic power. That could reduce social welfare losses and transfer more surplus to drivers and service providers, compared to the baseline scenario. Other scenarios examine alternative data access gateways, for instance by keeping the OBD plug open and by applying real time data portability under the GDPR. These scenarios may offer some scope for regulators if they wish to keep alternative data access channels open in order to stimulate competition in aftersales services markets. However, they entail additional hardware and switching costs for consumers, compared to the baseline and are therefore partial and imperfect substitutes. In two final scenarios we examine the market position of B2B data marketplaces and consumer media services platforms. The potential for data aggregation across car brands and other sources creates some possibilities for these platforms to provide a counterweight to monopolistic behaviour by the manufacturers. However, manufacturers' control over the data supply and access to the in-car human interface ensures that they retain substantial leverage over these platforms. Regulators may consider creating the conditions for a more level playing field between OEM services and third-party aftersales service providers. As a next step in this research, the general scenario-based observations in this study would have to be complemented with empirical evidence on the data market power of car manufacturers.