North American automotive and mobility companies are investing in transformations of their products and operations in response to significant changes in technology, consumer demand and regulation, according to a new research report published by Information Services Group (ISG).
The 2025 ISG Provider Lens™ Automotive and Mobility Services and Solutions report for North America finds that demand for electric vehicles and advanced digital features is leading automakers to significantly update vehicle platforms, development processes and manufacturing facilities for long-term competitiveness. They are navigating these fundamental changes amid a volatile regulatory environment in which some emissions and efficiency rules are being rolled back while rising tariffs threaten profitability and long-term business planning.
"North American automakers are in the middle of major technology transitions involving propulsion systems, software architectures and ongoing vehicle support," said Bob Krohn, partner, manufacturing, for ISG. "Service and solution providers play vital roles in addressing this broad set of challenges."
The North American and global industries are heavily investing in research and development to make vehicles connected, autonomous, shared and electrified (CASE), the report says. Despite slower-than-expected introduction and acceptance of some CASE technologies, enterprises still believe they represent major long-term business opportunities. Autonomous vehicles (AVs) are steadily emerging through robotaxi trials and ongoing development, while a growing number of urban consumers are choosing shared mobility access over ownership.
Rising demand for digital features and services is turning software into a defining characteristic of vehicles, leading North American manufacturers to realign product development toward digital features and computing platforms, ISG says. Consumers are increasingly interested in continuous vehicle updates, personalization and connected services such as navigation and entertainment, while over-the-air software updates offer companies a way to continually improve driver assistance and AV systems. Manufacturers are also increasing investments in technologies to counter heightened cybersecurity threats to increasingly connected vehicles.
As the automotive landscape grows more complex, partnerships are essential to meet emerging challenges and opportunities, the report says. Partnerships among manufacturers, technology vendors, mobility service companies and providers of EV charging infrastructure are becoming more common in North America. Companies hope to use these relationships to streamline operations, enhance service offerings and address evolving consumer needs.
"Mobility is no longer a challenge that can be solved simply by building a better car," said Swadhin Pradhan, assistant director and principal analyst at ISG and lead author of the report. "Automakers recognize that they need to work closely with partners to give consumers the software, services and infrastructure for next-generation mobility."
