Time for automakers to tap the brakes on self-driving car technology

 

 

 

I hope this summer that somebody somewhere in a manufacturer or supplier will be brave enough to say that autonomous vehicles – who still have no path to profit and still have no clear customer base that surprised them – will not happen in time closest.

I do not remember anyone who said it last week at the CAR Briefing Management Seminar in Traverse City, Mich. I have not heard recently about the records of company executives and car suppliers, who both invest heavily in trying to bring their own driving vehicles, even though they have personal doubts. And there’s something.

After the interview, when the recording recorder is off and there is time to chitchat off-the-record, some executives have expressed doubts about technology, time, infrastructure readiness or consumer readiness to pay for technology as new vehicles inflated prices. Last month, according to Kelley Blue Book, the average new light vehicle in the U.S. sold for $ 35,359.

But the makers and suppliers in a difficult place.

If Wall Street analysts are aware that companies fall behind competitors, the shares will be bought. A year ago at the CAR conference, Magna’s CEO, Don Walker, in a remarkable speech for a senior executive, offered some insights on what industry executives are saying about the record and what they think about their own vehicles.

He said: “Outright, car companies can not tell openly what they believe, they know what’s going to happen, but they have to say what will be popular as a progressive company. You get a lot of feedback from many car companies, and they really believe this is right. ”

But the huge money spent on trying to make a self-driving vehicle with 100 percent security 100 percent of the time – in my view – began to spoil some car companies’ to compete.

Take Ford, for example. The F Series truck is Ford’s Perennial Milk Cow and the vehicle that pays just about every big bill. If something happened – an earthquake that disrupts supply, a huge rise in material costs – and the margins of the F-series disappeared, Ford would have problems quickly. A May fire at a supplier cost Ford eight days of F-Series production, a vehicle that is expected to generate about $ 44 billion in revenue this year.

Ford plans to invest $ 4 billion in self-driving vehicles by 2023. But I can not find anywhere in Ford’s announcement of this large number that the company hopes to take advantage of this technology.

One lesson that never seems to resonate is that full line builders need a balanced portfolio of vehicles with a range of powertrains. And as in a financial portfolio, some of these investments will earn money and some will not. But to protect your bets, you keep at least some of the least profitable – cars, for example – because things can change in a minute in the car industry. Remember $ 4 a gallon of gas a decade ago?

I’m not saying that automakers should not spend money on autonomous driving technology. But autonomous vehicles should be about 10th on their priority lists. We live in a changing world characterized by tighter emission regulations, rising tariffs, a market that is rapidly moving away from traditional cars, overly influential financial analysts and other pressing issues.

It is also necessary to strengthen collaboration between car manufacturers, suppliers, regulators and all other players in the game to develop key technologies to ensure that all vehicles on the road have the same basic elements. This would reduce redundant engineering work, improve safety, reduce costs, accelerate development, and leave engineers where they were needed most: developing paid products today.

In the end, the sector must reduce its expectations. There are still too many unknowns about the practical application of autonomous vehicles. We do not even have national legislation governing the use of these vehicles in the United States.

If we want to be honest about autonomous cars, let’s agree that the best photo these vehicles will have, even for limited use, over the next 15 years will be in geo-fenced areas, universities, hospital campuses, bases military and amusement park parking lots – places where traffic is controlled, consistent and predictable.

It’s a race where finishing first simply means that you will lose more money faster.

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