Hello from Miami and the Florida Automated Vehicles summit, where yesterday I moderated a panel on how cities are preparing for an AV future.
The newsletter is off next week, so enjoy Thanksgiving and travel safely!
Smart Brevity count: 1,705 words, 6 minutes.
1 big thing: Every carmaker for itself
The once monolithic automotive industry is splintering over a range of issues, as companies scramble to cope with unprecedented technological disruption and business challenges.
The big picture: Although fiercely competitive in the showroom, automakers have long presented a united front on shared interests like trade policy, government regulations and labor relations. That's all gone out the window lately; now it's every man for himself.
What's happening: General Motors' unprecedented racketeering lawsuit this week against Fiat Chrysler Automobiles is the latest example of automakers turning on one another.
- GM accuses its crosstown rival of inflicting billions of dollars in damages by bribing United Automobile Workers leaders for competitive advantages that the union denied to GM.
- They say the injuries compounded between 2009 and 2015 in the form of higher labor costs and lost investment initiatives.
- GM said former FCA CEO Sergio Marchionne, who died in 2018, conspired with former UAW president Dennis Williams to try to weaken GM and force it into a merger with FCA in 2015.
FCA vigorously denies the charges, and says GM is trying to undermine current merger negotiations with Peugeot parent Groupe PSA and ongoing labor talks with the UAW.
- "If arguments both sides are making against each other are true — that Marchionne was using the UAW to bully GM's Mary Barra, and that she's now trying to undercut Fiat Chrysler's combination with PSA — the chess moves will go down as among the most dramatic by Detroit executives in decades," writes Bloomberg.
- On Thursday, JPMorgan analysts estimated that GM is likely to seek at least $6 billion in damages, and as much as $15 billion.
Another big split occurred recently in the war over tailpipe emissions rules.
- Ford, Volkswagen, BMW and Honda have lined up behind California, whose right to set its own pollution standards was revoked by the Trump administration.
- GM, FCA, Toyota and others, meanwhile, are siding with Trump, who wants to roll back tough Obama-era standards.
- Where they line up depends mostly on their sunk investments in future powertrains and how they think consumer demand will evolve.
- Two decades ago, Detroit automakers fought shoulder-to-shoulder against California's clean car initiatives.
What to watch: Shifts in trade policy could further divide the industry as the interests of foreign and domestic automakers diverge.
The bottom line: Faced with falling global sales and a potential transformation of the business, "the always-competitive auto industry has become even more dog-eat-dog," says Cox Automotive analyst Michelle Krebs.
2. That's a pickup truck?
Tesla last night unveiled its futuristic "Cybertruck" at a splashy L.A. event, as other automakers also move closer to bringing electric models to the huge pickup market, Axios' Ben Geman reports.
- Yesterday GM CEO Mary Barra said its planned electric pickup will go on sale in fall 2021.
- The startup Rivian is also bringing an EV pickup to market, and Ford is planning an electric version of its popular F-150 model.
Driving the news: Tesla's unveiling showed how the automaker's strategy is bringing something radically new to the scene and betting there's a market for it.
- "Trucks have been the same for a very long time, like a 100 years," CEO Elon Musk said onstage."We want to try something different."
My thought bubble: Those are famous last words for anyone trying to enter the pickup truck market.
- There's a reason pickups are designed the way they are; people use them as tools for work.
- Even Toyota, with deep enough pockets to reinvent the truck market if it wanted, hasn't been able to dent any of the top-selling pickups with its Tundra after 20 years.
There was one big snafu during the reveal: "Musk claimed the car was 'bulletproof' against a 9mm handgun. But when he got Tesla's chief designer to throw a metal ball at one of its armored windows, audible surprise could be heard as the glass smashed — twice."
The important numbers:
- A base single-motor, rear wheel drive model starts at $39,900 with a 250-mile range; a dual-motor all wheel drive version with 300-mile range starts at $49,000; and a top-end "tri-motor" all wheel drive version starts at $69,900 and can travel 500 miles on a full charge.
- The high-end model goes from 0 to 60 in 2.9 seconds and has a towing capacity north of 14,000 pounds, Tesla said. The base model tows at least 7,500 pounds and goes from 0 to 60 in 6.5 seconds.
- Tesla says production is slated to begin in late 2021, and a year later for the high-end version.
What they're saying: "The looks are polarizing, but the performance and pricing specs are undeniable," Kelley Blue Book executive publisher Karl Bauer said in remarks circulated to reporters.
3. Digital assistants riding shotgun
Some people like to name their cars (we called our old minivan "Chad" and my daughter's sedan is named "Trudy"). With the help of digital voice assistants, cars now are starting to take on their own personalities.
Why it matters: Using voice commands, rather than a touchscreen, can make cars safer by helping drivers keep their eyes on the road and hands on the wheel. But most early voice technologies have been disappointing or downright frustrating to use while driving.
What's happening: Advances in natural language processing and artificial intelligence are transforming the in-car experience.
- Amazon is partnering with a growing list of automakers, including GM and Audi, to embed its Alexa digital assistant in their vehicles; drivers can ask her to do everything from play music to roll down the windows.
- Ann Arbor, Mich.-based start-up Clinc's natural voice technology lets users speak conversationally to their car, using AI to understand the context and anticipate their needs.
It's easier to talk to your vehicle when it has a personality.
- "Personality has to be proactive. Right now [voice assistants in the car] only interact when you interact with them ... human beings that do that aren't very engaging," Brian Rider, head of automobility at Clinc, said during a panel I moderated this week at Automobility LA.
For an engaging personality, check out this video of Nomi, the AI assistant from Chinese-American electric carmaker, NIO.
- Engineers wanted Nomi to be engaging, but not intrusive, Tao Liang, NIO's director of machine learning, told me onstage.
- That's why it only has eyes, and not full facial features.
- Even so, it's cute as a button.
4. NTSB: AV tests need federal oversight
The National Transportation Safety Board this week blasted the federal government for lax oversight of autonomous vehicle testing on public roads.
Driving the news: At a meeting this week, NTSB said the probable cause of a fatal accident last year involving a self-driving Uber test vehicle was a failure of the backup safety driver to pay attention because she was distracted by her phone.
- The agency added that Uber's "inadequate safety culture" contributed to the accident.
What they're saying: NTSB said NHTSA should create a review process before allowing automated test vehicles to operate on public roads.
- Companies should be required to submit a safety self-assessment before testing can begin, the agency said.
- Currently, such safety reports are voluntary, and only 16 AV developers have submitted one; 62 companies are testing AVs in California alone.
In a statement, NHTSA said it welcomes the analysis and will review the NTSB’s recommendations.
- "While the technology is rapidly developing, it’s important for the public to note that all vehicles on the road today require a fully attentive operator at all times," NHTSA said.
5. FCC will free auto airwaves for WiFi
FCC chairman Ajit Pai offered a path forward Wednesday for the cable industry to gain access to auto airwaves for WiFi after a long-running spectrum battle with automakers, Axios' Margaret Harding McGill writes.
Yes, but: The move will pit the FCC against the Department of Transportation, which wants to see these airwaves fully dedicated to auto safety communications.
The big picture: Car companies and cable providers have been feuding over a swath of spectrum known as the 5.9 GHz band that was set aside 20 years ago for vehicle safety communications but never widely used for that purpose.
Driving the news: Pai's proposal, to be voted on at the commission's Dec. 12 meeting, would allocate the lower 45 megahertz of the band for unlicensed use such as WiFi, while setting aside up to 30 megahertz for vehicle safety technology.
What they're saying: Despite Pai's plans, a DOT spokesperson said all 75 megahertz of spectrum in the "safety band" should be preserved for transportation safety.
- The Intelligent Transportation Society of America was more blunt, accusing the FCC of trading safety for more connectivity. "It comes down to priorities — we can save and protect people’s lives, or we can ensure it's easier to place online orders from our cars," ITS America CEO Shailen Bhatt said.
- But Pai's proposal was cheered by cable companies and Public Knowledge, as well as the 5G Automotive Association, which backs the cellular-vehicle-to-everything technology that Pai's plan would accommodate.
6. What I'm driving
This week instead of a car review, I'm trying out the new LAX-it taxi and ride-share pickup system at Los Angeles International airport.
Why it matters: L.A. has banned taxis, Uber and Lyft from curbside pickup to ease the congestion at LAX terminals made worse by ongoing construction. If you're flying to L.A. anytime in the next few years, you'll have to get used to this new traffic management system until a new automated people mover opens in 2023.
What they're saying: The system got off to a rocky start in late October, as travelers complained about long lines and delays, prompting an apology from airport leadership.
- On Nov. 6, LAX responded to complaints by adding three lanes to the pickup lot, expanding its size by about 50% in hopes of getting more travelers on the road faster, reports the Los Angeles Times.
How it works: From baggage claim on the lower level, passengers board a green LAX-it shuttle bus.
- While on the bus, you can order an Uber or Lyft and you'll receive a PIN to give to the driver when you arrive at the lot.
- The bus ride takes about 10 or 15 minutes, but you can walk in about the same amount of time if you don't have a lot of luggage.
- Once you arrive at the LAX-it lot, you are funneled to waiting lines of Ubers, Lyfts or taxis.
- Give the PIN to the driver and your destination pops up on their screen.
My impressions: I was anticipating a headache, but I found the system works quite efficiently.
- There was plenty of signage, and lots of helpful people on both ends of the shuttle bus ride to direct unsure passengers.
- My Uber driver said the system is faster because drivers often spend 30 minutes or more in airport traffic just trying to pick up a passenger at the terminal. Instead, cars are waiting when passengers arrive at the off-site lot.
- Upon return to the airport, passengers can still get dropped off at the terminal as in the past.
The bottom line: Expect to see more ride-hailing solutions like this across the U.S. as traffic worsens at airports, concerts, sports stadiums and other big events.