Google, Mercedes-Benz Pact Spotlights How AI Can Drive Connected Car’s Evolution

Artificial intelligence (AI) may help drive the connected car’s journey from concept to fully-fleshed reality.

Mercedes-Benz said last week that it had entered a long-term strategic partnership with Google that has its roots in navigation and entertainment.

And as the announcement stated, as the “first step,” Mercedes-Benz will give customers access to Google’s Place Details function, which serves information about more than 200 million businesses globally, including business hours, photos, ratings and reviews.

The companies said they would bring the YouTube app into the Mercedes-Benz infotainment system and leverage Google Maps data to set up automatic speed adjustments before vehicles encounter intersections, roundabouts or curves.

“We’ll provide our AI and data capabilities to accelerate [Mercedes] sustainability efforts, advance autonomous driving, and create an enhanced customer experience,” Sundar Pichai, CEO of Google’s parent company Alphabet, in the release.

That latest initiative — the enhanced customer experience — is one that we note evolves when entertainment, real-time navigation and yes, commerce are woven together.

And in an interview with Karen Webster, Ingo Money CEO Drew Edwards said that AI has the potential to transform the very essence of mobility — connection cars and payments. There’s evidence that the transformation is already afoot. He noted that “Apple CarPlay and Google [Android Auto] have taken most functions away from the driver and turned them into voice commands. There has got to be some element of intelligence built into that because there’s a dialogue that goes on.”

As for connecting voice and contextual commerce, Edwards said, “It’s totally transformative, and payments are in the middle of that.”

“It’s where the connected car comes in because you can’t use your hands, and you’re interacting with this artificial intelligence. All the way through to paying for that experience, it just happens without you ever touching a keyboard or putting your credentials in.”

Commuters Become Customers

The Mercedes/Google linkup is one among many examples of the push toward transforming the commuter into a customer. As we noted in this space at the beginning of the year, Google’s made inroads with several automakers already. Porsche is reportedly considering integrating Google software into its vehicles. Google has already expanded its connected car partnership with carmaker Renault, allowing the automaker to offer over-the-air software updates to its vehicles.

For Google, the opportunity is there to keep giving a tailwind to Google Cloud. As seen in Alphabet’s most recent earnings report, Google Cloud revenues surged 32% year on year. And the company is continuing to focus on “shoppable” YouTube features.

Bringing commerce more fully into content — and content more fully into the in-car experience — may help Google monetize YouTube even further down the road (pun intended). For Mercedes and other automakers, there’s the opportunity to monetize data and software. Bloomberg reported last week that the automaker is targeting an additional $10 billion of revenue tied to developing its own operating system.

The stage is set to soup up the daily commute and the long road trip with digital enhancements (and with payments embedded into the mix). PYMNTS data, as seen in “How The World Does Digital: Different Paths To Digital Transformation,” show that there’s been a 4% increase in digital wallet usage across nearly a dozen major economies, and people are getting used to using apps and digital wallets as they travel. The American Automobile Association has also estimated that we spend an hour a day in the car, as noted in a report last Fall. That means for a chunk of the day, we’re willing — and now, increasingly able — to use the car as a large mobile device.