Category

Electric Vehicles

Crystal Ball Predictions

Three Connected Car Questions

By | Automotive, Electric Vehicles, Telematics | No Comments

Three Connected Car Questions for 2016

Q: Will autonomous cars be available in 2016?

No, they won’t. Automakers are making steady progress in autonomous navigation and driving technologies, and some of the building blocks are being gradually introduced in new cars. We will see advanced driver assistance systems (ADAS) technologies offered in a growing number of cars in the form of automatic emergency braking, adaptive cruise control, lane-keeping assistance and self-parking.

But it’s unlikely that self-driving cars will be roaming our streets for at least another 5 years. By 2020 we might see low speed self-driving cars or people-moving pods in limited-use applications such as company campuses, airport transfer services and retirement communities. Establishing dedicated paths or highway lanes for autonomous vehicles will accelerate the adoption and utilization of driverless cars.

Q: Will Google build an autonomous car?

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Elon Musk: Never Let a Good Crisis Go To Waste

By | Automotive, Electric Vehicles | 2 Comments

Following the Volkswagen emissions scandal, Tesla’s CEO Elon Musk and 44 CEOs, investors and environmental organizations sent an open letter to Mary Nichols, the chairperson of California’s Air Resources Board (CARB). (By the way, no other auto executive signed the letter; more on this later.)

In the letter, the authors argue that industry has reached the point of diminishing returns in extracting greater performance from diesel while reducing air pollutants. Therefore, they reason, any money spent by VW attempting to fix cars that cannot be fixed or removing these cars from the reads before the end of their useful lives will be wasted.

Instead, the signers encourage the CARB to direct VW to “cure the air, not the cars.” They suggest to release VW from its obligation to fix diesel cars already on the road in California and direct the company to accelerate the rollout of zero emission vehicles and to achieve at least tenfold reduction in pollutant emissions over the next 5 years.

Furthermore, VW will be required to invest in new manufacturing plants and/or research and development in the amounts that it otherwise would have been fined. Specifically, the letter suggests that VW will invest in building a large battery manufacturing plant.

I think this proposal deserves consideration.

Cynics might suggest that Musk is using this crisis to promote awareness to electric vehicle (EV) technologies and drive market activity in a space that continues to exhibit a disappointedly sluggish growth. Since its introduction in 212, Tesla’s global cumulative Model S sales just made it passed the 100,000 units mark, compared to 88 million cars sold annually worldwide.

You could also suggest that the announcement in 2014 that Tesla is releasing its patents to the public was a publicity stunt and a desperate attempt to prop the fledgling EV space.

Or, you might say, the ability to meet future demand for electric vehicle will be severely hampered by limited availability of battery packs. In 2014, Tesla broke ground on the Gigafactory battery manufacturing plant outside Sparks, Nevada. Forcing VW to spend some of its money on the same is going to further mitigate supply chain risks for Tesla, and for Tesla’s competitors, which, I believe, is the real motivation behind the letter.

Although Musk has an auto manufacturing company to run, he is looking farther than that. He truly wants to “cure the air” and has proven time and again he is willing to invest his own money and take financial risks for causes he believes in.

Musk is willing to share, collaborate and be in a “coopetition” where it accelerates innovation and spur more competition. Unfortunately, traditional automakers do not operate in the spirit of “the rising tide lifts all boats” and are unlikely to join Musk and the other executives in learning from the VW scandal and use it as an opportunity to move the industry forward.

(Photo: Francis Storr via Flickr)

 

Can Driverless Cars Make Ethical Decisions?

By | Automotive, Electric Vehicles | 2 Comments

Fully autonomous driverless cars may be in the future, but the vision is getting more vivid by the day. Great progress is being made in demonstrating autonomous car capabilities and enacting legislation to allow road testing, improving autonomous driving capabilities and inspire consumer confidence and acceptance of new mobility models.

But before autonomous cars are available at your local dealership or can be summoned from your smartphone app, there’s a number of significant hurdles that industry and governments need to overcome.  The purpose of this short article is not to contest the viability of autonomous cars, but rather to highlight some of the interesting and difficult problems engineers, legislatures, and ethicists (yes, ethicists; this is not a typo) are working on.

Human Behavior and Interaction

Mary Bara, GM’s CEOs said in a recent interview:  “I can put autonomous car out now, but the streets of New York are a great example [of the challenges]: the jogger, the dog, the baby carriage.” Recognizing static obstacles and even humans and small animals crossing the road is likely to improve considerably in the near future.

However, recognizing and responding to the complex and tacit interaction between drivers, cyclists and pedestrians will be much more difficult. For example, a police officer signaling for traffic to stop to allow pedestrian to cross the street. A driverless car doesn’t recognize the signal and proceeds through a green light but is unable to stop in time when the pedestrian steps into its path.

Weather

Daytime driving in the perfectly clear weather of California and Nevada doesn’t represent the average conditions autonomous vehicles will face in most other regions. Cars will have to be able to follow traffic lanes in snow covered roads, evade ice patches and potholes (I live in Boston!), and quickly recover when blinded by the sun.

Ethics

Making the right choice when there are conflicting objectives and restrictions is extremely difficult for advanced artificial intelligence based systems. The autonomous driving system is designed to obey the traffic rules, but will it be able to “break the law” to avoid hitting a pedestrian?

In fact, even if driverless cars eventually do possess advanced “moral judgment”, will all autonomous cars made by highly competitive OEMs employ identical decision “ethics” and collision avoidance strategies, or are they likely to make opposing decisions and stop in their track instead of evading each other?

Law and Liability

Issues surrounding accountability for damage caused by an autonomous and possibly even driver-assistant driving are only beginning to emerge. For instance, if a car’s software performed as advertised, but failed to prevent an accident, is the carmaker responsible for the damage?  Will we see a wave of drivers arguing that the car’s software failed to provide adequate lane departure or blind spot warning?

As GM’s Bara acknowledged: “[it’s a] huge responsibility whether you are steering or not.”

Cost and Critical Mass

Even as technology improves and consumer doubts eventually abate, the additional cost of sensor and computing technologies may prevent autonomous cars from being affordable by the mainstream for a long time. Of course, the cost will improve dramatically when autonomous cars enter volume production, but this will not happen until consumer acceptance is high enough.

This is a chicken-and-egg problem because the full potential of autonomous vehicles, and connected cars in general, will not be realized until the number of such vehicles reaches a critical mass. But reaching this point will require that enough consumers buy into advanced connected car and autonomous driving technologies.

Electric Vehicles for Everyone, Not Just the Elite

By | Automotive, Electric Vehicles, Telematics | No Comments

Mary Bara, GM’s CEO, recently attended her 25th reunion at Stanford’s Graduate School of Business. In a very insightful article and interview for LinkedIn, she openly discusses GM’s strategy and plans for connected cars, autonomous vehicles and electric cars. Here is what I think Ms. Bara got right, and where, I believe, GM has not quite caught up with the current trends in the consumer market.

Autonomous Vehicles

Ms. Bara believes “the transformations in the coming decade must be bold and focused”, but emphasizes that any success of autonomous vehicles pivots not only on advanced technology, much of which is already available in GM cars, but also on recognizing the critical role of infrastructure, technology and business ecosystem, and, of course, consumer acceptance.

GM “can put autonomous car out now, but the streets of New York are a great example [of challenges]: the jogger, the dog, the baby carriage” (see Driverless Cars Roadblocks.) Ms. Bara points out that broad market adoption depends on understanding and resolving difficult questions concerning drivers (and OEMs) responsibility: “[it’s a] huge responsibility whether you are steering or not.”

Ms. Bara intends to drive GM to lead rather than follow in developing autonomous car technologies, but, in contrast to “disruptive” companies like Google, she underscores the importance of continuous learning and step-wise improvement, and making steady progress while “pulling people along.”

Electric Vehicles

GM’s goal is to build “electric vehicles for everyone, not just the elite.” GM hopes the Chevrolet Bolt EV, which is supposed to be able to travel 200 miles on a single charge for a price tag of about $30,000, will help change consumers’ attitude towards EVs. Recently, GM announced new pricing of the 2016 Volt: $34,000 for the base LT model.

My take

Ms. Bara has a very sober view of the consumer market and will not predict when EVs might outnumber IC-propelled cars: “customers are very rational.” This is likely to prove  a more pragmatic and successful approach to the EV market than some of her predecessors who seemed to rely on luxury models such as the Cadillac ELR plug-in hybrid to compete head to head against Tesla (since its introduction in 2013, ELR sales have yet to reach 1,500 units.) Instead, GM should leverage its strengths in global manufacturing and supply chain to build and service cost-effective mainstream products in multiple markets. See Can GM Beat Tesla at its Own Game?

GM, like other major OEMs, is targeting the mainstream population, where, as many point out repeatedly, high vehicle cost and range anxiety keep most customers away from electric vehicles. Consumer trepidations concerning the viability and safety of driverless cars and autonomous driving is going to prove an even greater hurdle.

Industry should invest more in launching vehicles that operate in a defined—and therefore easier and safer to operate—spaces, such as a large company campus, airport inter-terminal and rental car transfer, or limited range delivery service. These will serve to improve autonomous driving technologies, lower the cost of electric powertrain components, and boost the trust and acceptance of wavering consumers.

Connected Cars

Connected cars services is one area GM doesn’t seem to be aligned with the consumer market, perhaps because of OnStar’s long presence (twenty years!) in the space. When discussing plans for next generation connected cars, Ms. Bara talks about wireless connectivity, 4GL and LTE standards, and smartphone integration. And while she emphasizes “putting the customer at the center of everything we do”, the OnStar model puts the vehicle’s identification number (VIN) in the center of the connected car universe, as do most other OEMs telematic and connected services products.

My Take

One of the fundamental principles of connected car services is the need to maintain a persistent mobile digital identity. Consumers living the always-connected lifestyle expect continuous access to personalized information and services from service and content providers of their choice, accessed and managed from their smartphones, and not restricted by the VIN of the vehicle they happen to be driving. Moreover, consumers do not want to pay the carmaker for services and data they already purchased and access using their smartphone, services that are of higher quality, faster and cheaper than those offered by the OEM.

GM should rethink the outdated OnStar model and place the consumers—drivers and passengers—in the center. This transition should be accompanied by the development of an active ecosystem of services and content providers.

Finally, it’s refreshing to see the growing recognition by Detroit automakers of the value of outside innovation, whether from OEM R&D centers in Silicon Valley or elsewhere (GM operates multiple research centers in the U.S. and around the world.) Presently, these centers seem to focus on core technologies, but can also serve as thinking tanks to improve the culture of customer centricity Ms. Bara want to inspire at GM.

Detroit, Silicon Valley

By | Automotive, Electric Vehicles, Telematics | 4 Comments

Automakers in Silicon Valley

The press and blogosphere are abuzz with rumors and opinions about Google becoming a car manufacturer, suggestions that Apple should buy Tesla Motors, and countless breathless headlines that tend to end with “will change the auto industry forever.”

While the majority of these comments are unsubstantiated and often lack technology understanding and solid business rationale, the sentiment at the core is correct: embedded software is critical to achieve the functionality, safety and brand differentiation consumers expect from modern cars. In-vehicle software is becoming increasingly complex and challenging the traditional carmakers that, by and large, lack experience developing sophisticated, high quality and user friendly software systems.

Automotive OEMs recognize, albeit very slowly, the need to revamp the in-vehicle infotainment (IVI) systems in their vehicles and to offer consumers the same rich and sophisticated experience they are accustomed to when interacting with smartphones and other contemporary consumer devices.

Since traditional automakers are not yet in a position to lure Silicon Valley talent to Detroit, they set up research and development centers in the Bay Area (see map). At last count, 13 OEMs and suppliers (not counting Valley-native Tesla) have set up shop in Silicon Valley; others have more clandestine operations and are scouting for local talent. As the data below shows, these operations are still very modest, but they are expected to expand rapidly.

Silicon Valley Automotive Employees

(Source: Financial Times, 2015)

 

 

 

 

 

 

The picture is almost the opposite at Tesla Motors, which strives on its innovation culture and non-traditional approach to automotive engineering, manufacturing and business operations. Non-automotive Silicon Valley companies pursue Tesla’s software engineers and Apple is rumored to offer new recruits from Tesla 60 percent salary increase and a $250,000 sign-up bonus. Nonetheless, this should not be construed as evidence that Apple is planning to get into the automotive manufacturing business.

Hopes or trepidations – depending on your point of view – that Apple is going to become yet another car manufacturer are misguided. Same for Google. These companies want to use their technology and market influence to keep drivers and passengers connected and engaged as part of their existing business model which, by and large, isn’t congruent with the auto industry.

Mobile Digital Identity

Consumers living the always-connected lifestyle expect continuous access to information and services that are customized to their needs. They use service and content providers of their choice and share information with peers and others in a manner they choose. The digital identify of these consumers is defined and managed by their smartphones, or, more accurately, by their login information.

Consumers expect their digital identify to be ever-present, independent of where they are and what mode of transportation they happen to be using at the moment. For instance, a person’s telephone address book, Sirius XM subscription and GPS destination information should be available not only in her own car, but also in the car she rented or even when she is in the passenger seat.

This is in stark contrast to the model offered by automakers, in which the car’s VIN (vehicle identification number) serves as the consumer’s digital identity, which means the vehicle maintains a separate set of navigation information, may or may not have a Sirius XM subscription, and the phone’s address book and call history are disconnected from the user’s smartphone.

Furthermore, the way automakers see it, consumers have no choice but pay for wireless data plan, satellite radio service, navigation map updates and so forth, all are services the consumer already paid for and are already available—at a significantly higher quality—through smartphones.

Back to Silicon Valley

All things considered, it makes little sense for Apple, Google and others to get into automotive manufacturing. The market for electric vehicles continues to be small and unprofitable, even for Tesla, which old only 35,000 cars and lost $16 million on $1.1 billion revenue in 2014. Market condition might be more favorable in 5-10 years, but for now these companies should take a wait-and-learn attitude when it comes to actual manufacturing.

It does makes a lot of sense for them to embed their technology and users’ ecosystem in cars from multiple OEMs, and deliver an ongoing, uninterrupted experience to information producers and consumers while in transit.

Automakers should use Silicon Valley’s help to rethink and redesign their approach to engaging consumers and offer models centered on the consumers’ mobile digital identity rather than the car’s VIN. They should work with Google, Apple and others to better understand consumer expectations and how to incorporate drivers and passengers into their content and services ecosystem.

While we are on the subject, Silicon Valley technologists and commentators should develop broader and deeper understanding of the business and technology complexities involved in car manufacturing, supply chain management, safety standards and so forth. Knowledge and appreciation of these will only serve to accelerate technology innovation and enhance the value of tight collaboration between Silicon Valley and Detroit.

(Map source: Guide to Silicon Valley’s Auto Corridor, Automotive News, 2014)