Sep 11, 2019

Axios Navigate

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Expert Voices contributor Yossi Vardi weighs in on the shortcomings of cybersecurity measures in vehicles.

Smart Brevity count: 1,263 words, < 5 minutes.

1 big thing: Imported AVs have an edge over U.S. players

Illustration: Sarah Grillo/Axios

The road to growth for an American driverless shuttle maker is being blocked by regulatory processes that put domestic startups at a disadvantage to foreign rivals.

The big picture: Absent a broad government policy on self-driving cars, most companies must find a way around federal motor vehicle safety standards to test or deploy their AVs on public roads.

Another type of AV — those boxy 8- or 10-passenger driverless shuttles — falls through the cracks, however, and the only domestic producer, Local Motors, is paying the price.

  • Two of Local Motors' competitors — EasyMile and Navya — import their vehicles from France and are able to get exemptions for R&D purposes.
  • Local Motors is petitioning the National Highway Traffic Safety Administration, complaining that "smaller, innovative American vehicle manufacturers" like themselves are at a disadvantage, hindering competitiveness and endangering American leadership in autonomy and new technology development.
  • "American companies creating American jobs building American cars have a higher bar to get vehicles on the road for purposes of research and testing than foreign companies importing vehicles," David Woessner, head of regulatory affairs for Local Motors, tells Axios.
  • "The technology is moving faster than the regulatory environment can keep up with," adds Randell Iwasaki, executive director of Contra Costa Transportation Authority, which is trying to deploy both U.S. and foreign-made shuttles on public roads.

Yes, but: Local Motors is a small company with huge ambitions and it's not clear it could deliver even if it received the necessary exemptions.

  • Besides reinventing future mobility, it also wants to disrupt traditional auto manufacturing by 3D-printing its Olli shuttles.
  • So far, it has produced just 20 demonstration vehicles, only a handful of which were 3D-printed.
  • It recently partnered with Robotic Research, which has boosted its credibility.

The intrigue: Foreign players are beginning to worry they'll be locked out in the U.S., which is why Easy Mile is exploring partnerships to put its technology on U.S.-built buses and why Navya opened a facility in Michigan.

What to watch: Two things could change the landscape for both domestic and imported shuttle operators.

  1. The DOT is close to awarding $60 million in federal grants for AV demonstration projects, with preference given to those deploying U.S.-built vehicles, in keeping with President Trump's 2017 executive order for government agencies to "buy American."
  2. NHTSA is moving to plug the loophole by creating a new rule that would allow domestic manufacturers to also request exemptions for R&D purposes, but it's likely to take a year or longer.
2. The pall over Frankfurt's EV extravaganza

VW's ID.3 is aimed at the mass market, but won't go on sale in the U.S. Photo: VW

The long-promised electric car revolution is finally getting underway this week at the Frankfurt auto show, but a host of industry challenges — both economic and technological — "threaten to wipe out profits and shake it to the core," writes Forbes.

The big picture: Carmakers warned that trade tensions risk dragging the global economy into a recession, according to Bloomberg, casting a pall over the event, one of the industry's most important showcases for future technologies.

  • BMW's CFO warned that it would close a factory if the U.K. opts for a hard Brexit, and VW's CEO said the trade war is getting scary.
  • "We come now into a situation where this trade war is really influencing the mood of the customers, and it has the chance to really disrupt the world economy," VW’s Herbert Diess said in an interview with Bloomberg TV.

Not the way you want to launch some of the most important vehicles in decades:

Quick take: I'm looking forward to driving all 3 of these electric cars, but I'm bummed that the cute and retro city car, Honda e, isn't headed to the U.S. market.

3. Where current cybersecurity guidelines fall short

Illustration: Aïda Amer/Axios

Amidst legislative stalling, a consortium of 12 manufacturers has developed a framework for automotive cybersecurity best practices, Yossi Vardi writes for Axios Expert Voices.

The big picture: At first glance, their guidelines hit the right points — incorporating security into design, developing risk assessment and incident response strategies — but current security solutions are not sufficient against increasingly sophisticated threats.

Background: The Self-Drive Act, a bill that didn't make it through Congress, required "manufacturers of highly automated vehicles to develop written cybersecurity and privacy plans for such vehicles prior to offering them for sale."

  • However, it fell short of prescribing specific guidelines for how security systems will ensure those objectives.
  • In developing their own safety and cybersecurity guidelines, automakers were trying to keep drivers and passengers safe — and also aiming to satisfy regulators who, in the absence of industry action or input, could impose rules that may be less favorable to companies.

What's happening: Today, most security solutions rely on rules, logic and signatures to detect threats, but this means they can only detect known threats. Contemporary security systems essentially do the bare minimum to comply with security guidances.

  • This is one reason current security measures are not the best place to start in designing a framework. Any time hackers develop new viruses or malware, cybersecurity programs play catch-up.

What's needed: To go beyond compliance and prevent hackers before they compromise security measures, manufacturers need to develop systems that will enable them to meet these still-unknown threats.

Go deeper

Yossi Vardi is the CEO of SafeRide Technologies, an automotive cybersecurity startup.

4. Driving the conversation

Gig labor: California bill makes app-based companies treat workers as employees (Kate Conger and Noam Scheiber — The New York Times)

  • Why it matters: The landmark bill would require companies like Uber and Lyft to treat contract workers as employees, entitling them to a minimum hourly wage and workers' compensation. But Gov. Gavin Newsom told the Wall Street Journal he's still negotiating with the ride-hailing companies.
  • Deep Dive: The new gig: America's hidden economy (Axios)

Investment: Electric vehicle startup Rivian lands $350 million in new funding (Ben Geman and me — Axios)

  • Why it matters: It's a fresh sign of intense interest in Michigan-based Rivian from deep-pocketed players. It also illustrates the amount of money flying around the EV space as investors look where to place their bets.

Hungry: Uber Eats widens service to eateries that already deliver (Kia Kokalitcheva — Axios)

  • Why it matters: As Kia scooped yesterday, there's a lot of pressure on Uber Eats to turn a profit to bolster its parent company's business. Now it's working with chains like Panera and Joe's Pizza, a New York regional chain, to supplement their own delivery operations.
5. 1 splat thing

High-powered spray nozzles wash bugs from AV sensors. Photo: Ford

Ford has developed a self-driving car that's insect-proof.

Why it matters: If you've ever driven a car with bug guts smeared across your windshield you know how it affects visibility. Self-driving car sensors have the same problem.

  • Dirt, dust, road salt — and yes, insects — can obscure an AV's sensors.
  • An AV that can't clearly "see" its environment won't perform as well.

To better understand its nemesis, Ford consulted with zoologist Mark Hostetler, author of "That Gunk on Your Car," and then built a makeshift bug launcher to fire insects at its sensors, according to a Medium post by Ford engineer Venky Krishnan.

The engineering solution was two-fold:

  1. Air is funneled through slots near the camera in the car's rooftop "tiara" — the funny-looking structure that houses an AV's cameras and lidar systems — deflecting bugs "like changing the course of an asteroid on a crash-course with Earth," says Krishnan.
  2. For those pesky cling-ons, a cleaning system controlled by software algorithms sprays dirty sensors with washer fluid as needed and then gives them a quick blow dry.