Manufacturers headed for a crash in an era of connected cars
Car companies are like publishers, or the craft businesses that once made horse buggies: they are stuck trying to maintain a business model that is obsolete. They need to sell more cars, with higher-priced spare parts and more features, with built-in obsolescence, to make more profit.
They build their brands on driving for pleasure, with the car as a status symbol. And so they need to make cars that enhance the driving experience, not replace it.
Yet that is exactly what Google is doing: replacing the driver entirely.
No steering wheel, no brake, no accelerator. No fancy features. No need for complicated and expensive human-car interfaces. No need to worry about driver disctractions or driver overload or when (and how) to hand back control in an emergency —an impossibility, given all evidence is that humans simply cannot react in the time available. All sorts of legal complications and insurance issues are avoided.
Google is also designing the car to be able to navigate safely without any need to communicate with other vehicles or infrastructure. Google’s car will drive just like people do, using highly accurate internal 3D models of the immediate vicinity, combined with input from the environment (mainly light and sound and grip on the road, as well as inertia). This greatly reduces the risk of cyber-hacking.
I’m not saying that Google has it perfect, but what it is doing is safe, simple and cheap (relatively speaking).
What the car companies are doing is complicated and costly and, in the end, is bound to fail. No wonder no one who really understands the issues, and could do the job, wants it.
Who cares about the features of a taxi? You don’t need electronic gizmos in a car when you can bring your own, and who cares about communicating with the car (except the car company)?
As far as city and suburban driving goes, most driving is not a pleasure. It is a way to get from A to B. Not saying that no one will want to drive — some people still like to ride horses. But riding is not how most people travel.
The new business model is for competing local facilities (scaled to support the transport needs of a city) designed to produce, clean, maintain, refurbish and recycle the required range and number of vehicles (electric bikes, town cars, sedans, people movers, utes, SUV, vans, et cetera) on demand anywhere in the city within five minutes of order.
It is Uber, Google and Tesla combined.
In this business model, you need a plant that is designed very differently to a mass production plant.
The cars too need to be differently designed. They need to be made to last as long as possible and be as easy to maintain and refurbish as possible: that means electric. And you want to make the least number of vehicles with the least features at the lowest cost to deliver the service. The key words are safe, clean, reliable, and comfortable.
It is going to be a very interesting tussle. My money is on the tech companies, though some car companies will make the shift, and others will become niche producers of drive your own.
The rest are going to disappear.