FRANKFURT - Carmakers are tapping smartphone technology to spruce up low-cost city cars and try to get an edge in a market that has grown to account for almost 10 per cent of new car sales in austerity-scarred Europe.
The Opel Adam Rocks, the new Peugeot 108, the Citroen C1 and the Toyota Aygo will be among the compact city cars on display at the Geneva motor show this month - all available with large multimedia screens that can display music libraries or navigation maps stored on a smartphone.
Such features have already proven a big draw for customers in more upmarket models, and are now being added to a new breed of urban runabouts pitched at younger, tech-savvy drivers. "What used to be a feature seen in premium cars is now coming in to the low and medium end of the market," said Dinesh Paliwal, chief executive of Harman International a maker of so-called "infotainment" systems for the auto industry. "It's driven by a change in lifestyle where people no longer want to stop being connected just because they are in a car."
The new city compacts are part of a class of cars known as the A-segment, which means they are smaller than BMW's MINI - a factor that makes them lighter, more fuel efficient, and thus cheaper to own and run.
With sticker prices starting between 9,500 euros and 11,500 euros (S$16,580 -S$20,070), the cars are proving popular among first-time buyers in Europe as the continent emerges from a prolonged period of economic weakness.
Researchers IHS Automotive forecast sales of A-segment vehicles will rise by 10.6 per cent between 2013 and 2017.
But to succeed, analysts believe manufacturers will have to meet the growing expectation of young drivers to be able to access information and entertainment - or infotainment - from their smartphones. "Many first-time buyers are young, and these tend to be more tech savvy than other more traditional clients. Carmakers can't ignore this," said Andrew Poliak, director of automotive business development for QNX Software Systems, a software maker owned by mobile phone group BlackBerry .
According to the International Data Corporation, smartphone shipments reached 1 billion and eclipsed sales of "standard"phones for the first time in 2013, accounting for 55.1 per cent of overall mobile phone deliveries.
As a result, Harman International expects sales of car infotainment systems to grow 14 per cent between 2013 and 2016, compared with global passenger car sales growth of less than half that rate.
Not all attempts to make cars more sophisticated have been a success, however. Ford slipped in the quality rankings in the United States after its "Sync" infotainment system proved vulnerable to glitches.
Carmakers are not alone in driving the convergence between their industry and the technology sector.
Apple said on Monday it would unveil a new hands-free technology for car drivers at the Geneva show, which will make its debut in Ferrari, Mercedes-Benz and Volvo vehicles.
The US group's CarPlay technology will make it simpler for drivers to make calls, read maps and to listen to their music library using swipe gestures or voice activation, much in the way they are used to doing with an iPhone. "We are constantly developing the connected car with the latest technologies available, so that every Mercedes-Benz driver can use their smartphone in full comfort and safety,"Thomas Weber, responsible for research and development at Mercedes-Benz, said of the deal with Apple.
The makers of cheaper, smaller cars are striving to keep up.
General Motors unit Opel is set to unveil the Adam Rocks in Geneva, a city car with an infotainment system costing just 300 euros which can connect to smartphones using Apple's iOS or Google's Android operating system to answer phonecalls and dictate text messages using a hands-free speaker.
A spokesman for Opel said the "Intellilink" system was already being ordered by 70 per cent of European buyers of the standard "Adam" model.
MINI, which is about to launch the fourth generation of its vehicle in March, said it expects more than a quarter of its cars to be equipped with the MINI Connected infotainment system, which is also compatible with Android and iOS software.
Although many carmakers are using Geneva to launch their latest products, some have gone to technology fairs as well.
Last year, Ford boss Alan Mulally took the stage in Berlin at the IFA, Europe's biggest consumer electronics trade show, to present the US company's "connected car" strategy. That was after General Motors' (GM) Steve Girsky did the same at the Mobile World Congress in Barcelona.
The Consumer Electronics Show in Las Vegas (CES) in January was attended by a record number of automakers showing the latest in-vehicle navigation, entertainment and safety systems, including Toyota, Ford, GM, Audi and Hyundai.
Next week, Volkswagen Chief Executive Martin Winterkorn will give the keynote speech at the CeBIT technology trade fair in Hanover, Germany.