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Design+ The transformation of the automotive industry

across entire societies at global, national, and local levels. which can be classified as first-order or second-order change
This distinction shows that transition covers specific, depending on their depth and scope. First-order change
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often technically oriented aspects, while transformation is evolutionary and involves incremental adjustments
encompasses broader social, technological, institutional, within existing systemic boundaries, without fundamental
9,10
and economic changes. For the purposes of this work, the reshaping of the organizational culture, strategic direction,
term “transformation” is used, as it more comprehensively behavioral standards, processes, or structures. These
covers these profound changes. changes are quantitative, evolutionary, and limited to
In addition to the term “transition,” the term “structural specific units or segments of the organization, with limited
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change” is frequently used in the context of transformation. intensity and complexity.
Structural change refers to the ongoing alteration of the Second-order change is revolutionary and
economic structure, where the significance of individual transformative, affecting the entire organization or
sectors shifts over time. While traditionally described significant segments of it, leading to fundamental,
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as a shift from the primary to the secondary and then to profound, and complex changes. These changes represent
the tertiary sector, modern economies exhibit more a qualitative, paradigmatic development of the company
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complex interdependencies. The increasing importance and its frame of reference. 14
of knowledge-based services, research and development Wayland expands this view by considering the influence
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(R&D), and digitalization has led to the emergence of a of industry structure and the external environment,
quaternary sector, which encompasses high-value services distinguishing four types of change: Incremental,
such as consulting, IT, and advanced producer services that contextual, structural, and fundamental change.
support industrial activities. These structural shifts influence
both the manufacturing sector and service-based industries, 2.3. Technology-induced transformation
as technological advancements and evolving market Technology-induced transformation represents a
demands create new dynamics between sectors. When the paradigm shift, where technological innovations bring
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focus of a transformation process is on the economic system about fundamental changes. Schumpeter describes this
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of a state, the concepts of transformation and structural process as creative destruction, in which existing structures
change can largely be considered synonymous. Structural are replaced and new ones are created. Numerous theories
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change can occur in three dimensions: and models have been developed in the scientific literature
Sectoral structural change: Long-term changes within to explain technology-induced changes. 19-22 This work
the sectoral economic structure due to varying growth employs Foster’s S-curve model and Christensen’s theory
rates of individual sectors. 13 of disruptive innovation, as they provide fundamental
insights into the dynamics of the automotive industry.
Intra-sectoral structural change: Changes within
individual sectors caused by product innovations or The S-curve model, based on Arthur D. Little’s
changes in production technology. 13 technology life cycle, describes the life cycle of technologies
Regional structural change: Changes in the economic from the emergence phase through growth to maturity
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structures within regional economic areas, influenced by and finally to the phase of aging or decline. The model
specific location factors that determine the direction and illustrates the performance of an established technology
and its substitute technology, shown in relation to the
extent of the change. 13
cumulative effort in R&D. This relationship is depicted by
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In the context of the automotive industry, the transition the slope of the curve, which symbolizes the performance
from internal combustion engines to electrified propulsion gain relative to the R&D effort expended, thus reflecting the
systems, combined with the growing relevance of digital productivity of R&D. It demonstrates that technological
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mobility services and automation, exemplifies structural developments have inherent limits and shows that initially
change within and across sectors. The development high investments in new technologies are required before
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and deployment of new mobility concepts increasingly they reach a turning point, after which comparatively low
rely on advancements in digital infrastructure, software additional investments lead to significant performance
integration, and R&D, highlighting the role of knowledge- improvements. Foster extends this concept with the
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intensive services in shaping industrial transformation. 12 theory of technological discontinuity, which explains why
new technologies are initially inferior and why established
2.2. Types of change
companies are hesitant to invest in them. New market
In the scientific literature, two main types of change are entrants, unburdened by legacy issues, can leverage these
distinguished: Evolutionary and revolutionary change, technologies to surpass established companies. 21

Volume 2 Issue 1 (2025) 3 doi: 10.36922/dp.4445