California a Testing Ground for Where Automakers are Heading

by Jon LeSage

For­tune Mag­a­zine writer Michal Lev-Ram has a few things in com­mon with Ford Exec­u­tive Chair­man Bill Ford, for­mer Ford CEO Alan Mulal­ly, Daim­ler CEO Dieter Zetsche, and BMW CEO Nor­bert Rei­thofer. Each of them see a huge par­a­digm shift com­ing up as vehi­cle man­u­fac­tur­ers trans­form into what Ford calls “per­son­al-mobil­i­ty com­pa­nies.”

Dur­ing a busi­ness trip to Cal­i­for­nia, Lev-Ram nar­rat­ed her expe­ri­ence get­ting stuck in heavy traf­fic on the Inter­state 10 in Los Ange­les and vis­it­ing cor­po­rate cam­pus­es upstate in Sil­i­con Val­ley and San Fran­cis­co. In “The end of dri­ving (as we know it), the writer also lays out social and eco­nom­ic trends that are more inten­si­fied now in Cal­i­for­nia but are also dis­sem­i­nat­ing to urban cen­ters around the coun­try……..

  • Demo­graph­ics are chang­ing as more peo­ple move into cities, espe­cial­ly young pro­fes­sion­als. Car own­er­ship is very dif­fer­ent sto­ry than it was for their par­ents. “The car is no longer the gate­way pur­chase to adult­hood,” says Sheryl Con­nel­ly, Ford’s glob­al trends and “futur­ing” expert.
  • Automak­ers have seen it devel­op­ing for years and have set up facil­i­ties in Sil­i­con Val­ley. Ford’s office in Palo Alto is work­ing on con­nect­ed vehi­cles and open-source soft­ware; Mer­cedes-Benz has about 150 employ­ees in Sun­ny­vale and their lat­est project has been Boost by Benz, which shut­tles kids to and from soc­cer prac­tice. Volk­swa­gen engi­neers in Bel­mont are work­ing on advanced-speech recog­ni­tion and autonomous vehi­cles. New­com­ers to the auto-mak­ing busi­ness, Tes­la Motors and Google, are based near­by; Tes­la in Palo Alto and Google, with its dri­ver­less pod car test pro­gram, in Moun­tain View.
  • Cal­i­for­nia is see­ing increas­es in pub­lic trans­porta­tion use, bicy­cling, walk­ing, and usage of car­shar­ing and rideshar­ing ser­vices. Munic­i­pal­i­ties are sup­port­ing these efforts, such as San­ta Mon­i­ca and Los Ange­les adding the “Sub­way to the Sea” light-rail line that will con­nect down­town Los Ange­les to the ocean view in San­ta Mon­i­ca.
  • Major cities across the US are see­ing more of their res­i­dents go with­out car own­er­ship and using oth­er modes of trans­porta­tion. New York, Philadel­phia, Chica­go, and Los Ange­les have, in that order, the high­est per­cent­ages of house­holds with­out a vehi­cle.
  • Rideshar­ing ser­vices like Uber are find­ing a lot of inter­est among cus­tomers in major cities, who use their mobile device to get picked up right away and deliv­ered to their des­ti­na­tion. That’s tak­ing busi­ness away from taxi ser­vices and legal/legislative bat­tles are build­ing up. GM and Toy­ota recent­ly announced that they’re offer­ing car pur­chase dis­counts to Uber dri­vers who use their per­son­al cars to do their jobs.
  • Increas­ing traf­fic con­ges­tion and con­cern over safe­ty are the dri­vers behind the autonomous vehi­cle move­ment. Google and its allies claim that dri­ver­less cars will cut down on col­li­sions and inef­fi­cient dri­ving – and will even reduce the amount of space need­ed for park­ing as these dri­ver­less cars could be direct­ed to bet­ter places to park. Google and its pro­po­nents claim that unmanned cars will cut down on acci­dents and inef­fi­cient dri­ving and even reduce the space that offices need to allo­cate to park­ing (the cars could just move them­selves around). Instead of fight­ing traf­fic, erst­while dri­vers could be work­ing on their lap­tops, read­ing, even doing sit-ups in the back of a souped-up mobile gym. “We think the self-dri­ving car is going to work and be far safer than human dri­vers,” Sil­i­con Val­ley ven­ture cap­i­tal­ist Marc Andreessen said to For­tune. “In 10 years it will be quite com­mon, and one day we’ll think it was luna­cy we ever let a human behind the wheel.”

Jon LeSage, auto­mo­tive edi­tor, green ini­tia­tives at Auto­mo­tive Digest, also serves as edi­tor and pub­lish­er of Green Auto Mar­ket.



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