Category Archives: In Society

The Autonomous Car Debate Sidelines the Most Important Question – How?

As eager as I am to talk about the coming innovations in the auto industry, the autonomous car debate has got to be one of the most beat-the-dead-horse discussions I’ve ever seen, and I’m guilty of adding to it (see two other posts… hopefully this will be the last). On one side, you have the Silicon Valley techs that are firmly convinced that technology for technology’s sake is the quickest way to create a flourishing utopia. On the other hand, you have the doomsayers who predict that no one will want the autonomous car and is just the latest macro-trend of the recent generations’ lack of work ethic and iPhone obsession.

Overall, this debate as to whether autonomous cars will or won’t be more efficient and safe is a silly roadblock to more serious discussions about how a world with autonomous cars might work given the limits of both technology and humans. Until both sides get beneath the surface of this dramatic shift in personal transport, expect to see both sides continue to throw their food across the cafeteria at each other. 

The mountain of articles from well-respected experts on both sides of the debate focus on four questions: would autonomous cars actually make us more productive? Would autonomous cars actually make us safer? Would people actually want them? And what are the moral implications for a car that decides who lives and dies? Both sides have their own research data to answer these questions affirmatively in their favor, leaving no one happy. To this day, however, I’ve yet to see serious talks on how these autonomous cars actually increase productivity or make us safer, and the answers that have been given are less than comforting. 

Google is the only one that has made a halfway-decent effort by saying that autonomous cars will be able to travel closer together on roadways, thereby making room for more cars, and also that autonomous cars won’t crash. The rebuttal to this argument should be that both of the points Google made assume an overwhelming adoption rate, but the opposition is too upset about the drawbacks of autonomous cars to be able to have a serious thought about how their fears might be able to be curbed in how autonomous cars might interact with our world. 

At this point, the debate should turn to how we can create special infrastructure or somehow adapt existing infrastructure to separate autonomous driving from human driving, specifically on highways. In following California’s example with clean vehicle lanes, incentivizing people to adopt new technology is the surest way to success, not through debating the opposition to death. 

In shifting the conversation to how autonomous cars can help us lead safer, more efficient lives, both sides of the talks can start to have real discussions that might actually begin to find common ground. For example, if we created specific autonomous driving lanes on major highways while leaving other roadways as semi-autonomous, we’d probably resolve some of the major contention. At the same time, people would realize how much cooperation between governments, construction groups, tech companies, urban planners, and car companies is going to be necessary to truly realize productivity gains and safety enhancements, sparking even more specific and applicable conversations. 

What Iridium and Concorde Can Teach Us About Autonomous Cars

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If you remember back to the late 90s, the words Iridium and Concorde should ring a bell. Iridium, the brainchild of post-Cold War Motorola, was the satellite phone technology that was supposed to revolutionize the cell phone industry by enabling you to make a call from anywhere in the world – even places like Chechnya or the Gobi Desert. The Concorde boasted its ability to get passengers from London to New York in around 3 hours by traveling at supersonic speeds. The fact that these products no longer exist should be a clue that what is hyped in the media as the next breakthrough technology to be commercialized does not always go as planned.

One of the main reasons that these technologies failed is not that they weren’t revolutionary or game-changing from a design perspective, but rather that their commercial applications were misguided. For both Concorde and Motorola teams, they assumed that customer demand would be endless, or at least strong enough to make the project worthwhile. Why did they assume this? Because the engineers building Iridium were the same ones who had spent their careers working on government projects for which there was a guarantee demand for the technology they built, and the Concorde was actually a French/British government project that was planned to be commercialized.

Furthermore, both companies failed to realize that their potential customer base was actually a small sub-segment of the existing cell phone and travel customers that was willing to pay more for a phone that works everywhere or save 3 hours in flying time. The rest of the cell phone users and travelers were satisfied with the existing lower-cost limitations of phones and planes. From the engineers’ perspective, who in their right mind wouldn’t want to take advantage of this technology?

Besides who was going to buy it, these companies failed to take into account real-world limitations of the technology. For Iridium, the phone couldn’t work inside buildings or in dense cities, which coincidentally was exactly where their potential customers wanted to use them. For the Concorde, it was not allowed to fly at certain times of day due to the obnoxious sonic booms, which coincidentally was exactly when the potential customers wanted to fly.

The media is great at constantly hyping Google and now Apple’s autonomous driving projects with pictures of little egg shaped pods flashing across the screen. There are no doubt going to be automated features that make driving safer while being profitable projects for car companies, but the Motorola and Concorde cases beg the question as to how large this consumer base for fully autonomous vehicles can be, and what real-world limitations might stand in the way.

For the first generations of fully autonomous vehicles, they’re going to be expensive, they’re going to be confined to dense urban centers that are more or less low-speed and grid-like, and it can’t be snowing or torrentially raining outside. How many places can you think of that fit all three? Autonomous features and eventually fully autonomous cars are absolutely coming and will definitely re-shape the future of automobiles, but we cannot forget that we’ve been in similar situations with similar groundbreaking technologies before – best not to bury our heads in the sand quite yet.

Image Source: dezeen.com

Key Words of 2015: Autonomous, (Alternative) Fuel, Connectivity

2014 was a remarkable year for automotive sales and futuristic innovations, but carmakers are looking to kick things up another notch in the coming year. Buzzwords for this year are similar to last year, but what will be most interesting is to see the divergence of thinking and reactions by automakers in regards to three big topics: autonomous vehicle features, alternative fuel integration and reaction to petrol pricing, and enhanced connectivity technology.

Anyone with a fairly diverse Twitter account has seen some post about a new autonomous vehicle being showcased at the Consumer Electronics Show in Las Vegas the past couple days. The dazzling Audi A7 that drove hundreds of miles only to come onstage at the touch of a wristwatch at the show was nothing short of incredible, and the Mercedes pod-like car undoubtedly drew gasps and reactionary applause. In 2015, the word “autonomous” will begin to take on many different meanings depending on the company you talk to. To Toyota, giving the driver complete control with the most advanced warning systems and intelligent driving capabilities is paramount, while Google and to some extent Mercedes, are looking to eliminate driver control in its entirety. Here are some questions that will dominate the conversation over autonomous technology: Do people actually want or trust completely autonomous cars? Is there a way to eliminate a majority of accidents while keeping humans as the primary decision makers? Can we even make a perfectly safe autonomous contraption? On a more immediate basis, most of the conversation will be driven by existing autonomous features such as smart cruise control, valet automatic parking, and vehicle-to-vehicle (V2V) informatics. However this discussion plays out this year, expect to hear die-hard critics and boosters of the technology that echo the same type of heated discussion present in the second big topic of the year.

While alternative fuels, specifically hydrogen fuel cell (FCV) and electric cars, have been debated for many years, this year carmakers are facing a mostly-unforeseen wrench thrown into the equation: what the hell do we do with all these fuel efficient and alternative fuel vehicles now that gas prices are so low? If you’re Tesla, the answer is nothing, mainly because no one buying an $80,000 car is really that worried about gas prices in the first place. But if you’re GM or Toyota or Ford who relies on customers purchasing these fuel efficient vehicles in order to meet increasingly-stringent EPA fuel economy standards, this question is daunting. The question this year, or at least for a good part of this year for these companies will be: how do we get people to still buy these fuel efficient cars even though they aren’t incentivized to do so like they were six months ago?

Finally, connectivity might be the vaguest of the three topics to continue to be talked about this year, but this is the year that automakers will either fail or succeed with flying colors. The much-anticipated release of Apple’s CarPlay, Android Auto, and MirrorLink (a weird compromise for those who for some reason have chosen neither an iPhone or Android phone), will rule the conversation as many new models will finally become available with these technologies. Essentially, automakers have realized they make lousy tech companies, so instead are looking to form their infotainment centers into a nicer, bigger iPhone or Android, with the same functionalities of apps and voice recognition that everyone has come to expect. Those companies who do it right this year will be rewarded with younger buyers being interested in their cars as performance and handling become less important than how fast one can find the nearest Starbucks.

All signs point to another good year in terms of sales for car companies, but a changing landscape in terms of macroeconomic commodity pricing, an increasing reliance on tech companies to provide competitive advantages to automakers, and a public debate as to how far we plan to take futuristics autonomous cars will prove a challenging but nonetheless unprecedentedly-colorful automotive period.

China’s (and America’s) Booming SUV Market

Cadillac Escalade at the 2014 NYIAS
Cadillac Escalade at the 2014 NYIAS

Chinese SUV sales grew a staggering 49 percent last year. Let that sink in for a second – in 2014, we are again talking about SUVs as a booming sector of the auto industry.

This shift can in part be attributed to China relaxing its one child policy, with bigger families needing more room to accommodate little ones. Chinese customers also value the ruggedness, comfort, and versatility of bigger cars, and continue to embrace with open arms the 69 new SUV models introduced in 2014. The trend doesn’t appear to be slowing down either, as China’s current level of SUV sales only accounts for around 14 percent of the country’s auto market. Compare that with the West’s 35 percent average, and you get some giddy auto analysts predicting plenty of room for growth.

The news gets even better for SUVs. In the US, where gas prices have leveled off to “reasonable” levels and the Prius craze has forced truck efficiency technology into hyperdrive in recent years, Americans are again hungry for big cars. Over the past year, the US has seen gains of 10 percent in the SUV and truck space, with no sign of slowing in the near future.

This shift towards SUVs is particularly interesting for the US because we have seen a similar scenario before in the aftermath of the 1970s oil crisis, but this time the eco-trend is permanent. Instead of companies ditching the compacts and hybrids the moment gas prices went back to relatively normal levels, the eco-friendly car segment continues to grow. Maybe not at the same rate as the late 2000s, but still definitely growing.

In part, governments are now dictating fuel economy standards for car companies’ product portfolios, but average consumer eco-consciousness for the sake of eco-consciousness has definitely taken hold. Today, companies are producing cars for the US that have fuel economies from 15 to 50 miles per gallon, with a healthy number of customers making up both ends of the spectrum.

In the 2000s, everyone was ditching their SUVs out of necessity because no one could afford gas, and (US) automakers scrambled to make more fuel efficient cars because every consumer segment was screaming for them. With the recession mostly behind us and gas prices steady, companies must now broaden their strategy to include less gas-price sensitive consumers that have gotten off the hybrid, eco-friendly wagon in favor of their beloved SUVs. This is good news for most companies, as SUVs typically produce the largest profit margins, and it’s also a segment in which American automakers are historically very good at competing.

Sources for this post:

http://autonews.gasgoo.com/china-news/suv-sales-in-china-still-rapidly-growing-suv-segm-140827.shtml

http://www.timescolonist.com/china-s-auto-sales-growth-decelerates-to-8-5-per-cent-in-august-but-suv-sales-jump-30-per-cent-1.1352371

http://www.observer-reporter.com/article/20140930/NEWS15/140939992#.VCtE0ildUpw

Mercedes Banks On America’s Little Pink Houses For Future Growth

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Back in May, Fast Company questioned whether Mercedes’ focus on catering its lineup to a suburban America was a shrewd tactic or wishfully daft. It didn’t gain a lot of attention, but the impact of shifts in people’s living situations on car companies’ product planning and overall strategy cannot be understated.

“The myth is that people are tired of suburbs and moving into cities. That is simply not true,” stated a blunt Eric Larsen, director of Mercedes’s society and technology research group.

The Brookings Institute explains that the recent slump in suburban growth can be mainly attributed to a still-rebounding housing market. They conclude, somewhat blandly, that the general cycle of city-dwellers eventually moving to suburbs will continue to occur as it has in the past. Over the next decade, they forecast suburban growth to potentially climb higher, with urban areas continuing to experience growth as well. The below graph from Brooking can be misleading – suburbs aren’t shrinking, they’re definitely growing. Just not at the rate of certain urban cities.

Courtesy of Brooking Institute via Fast Company
Courtesy of Brooking Institute via Fast Company

Mr. Larsen summarized, “The U.S. is a unique market, with the rise of mega-suburbs, not mega-cities. It’s good news for our company.”

Later, I posed Fast Company’s question to Neil King, an automotive contributor at EuroMonitor. He agrees with Mr. Larsen that the US is a distinctive market in which Americans love owning all four walls for some reason. Shifts in urbanization notwithstanding, he believes that changing demographics of the inhabitants to be the most important changes for companies to adapt to.

Mr. King explains that more women in the workforce, lower birth rates, and later marriages mean smaller households which translates into smaller car needs. Shifts towards home delivery and online retailing further decreases the need for large SUVs, paving the way for the likes of the Audi A3s, BMW 2s, and Mercedes CLAs to make up a much larger volume of the yearly luxury purchases.

Interestingly though, new Chevy Tahoe sales are growing at healthy rates, BMW continues to bear down on the luxury SUV market with the massive X7, and S-Classes are practically selling as fast as Daimler can make them. Whatever the case may be, some variable is seriously missing in this equation.

To view the original article from Fast Company, click here.