Monthly Archives: June 2013

Should GM, Ford and Toyota fear Google?

“We are certainly living in interesting times indeed”

That must’ve been the nth time I said that. I could not help it.

Thanks to early monsoon rains Bengaluru my home town was back to being the most pleasant place to be in. The city had been experiencing one of the hottest summers in recent times.

My friends and I were celebrating the change in the weather over some “Menasinakai Bajji”, a Kannadiga fiery hot delicacy made of deep fried long chilies stuffed with vegetables along with pots of home brewed South-Indian style filter coffee.

The discussion starting from global warming, effects of automobile pollution finally ended with Google’s self-driving car technology. Here are the highlights of the discussion:

  • Though several auto giants like BMW and Audi have developed their own version of self-driving technology its Google a company that has almost nothing to do with transportation industry except for Maps has made significant progress.
  • According to an article in Economist:  Google’s self-driving cars have clocked up 700,000 km (435,000 miles) under autonomous control without incident. Snow-covered roads and temporary signs around roadworks still pose challenges, but the technology is improving all the time.
  • Distance of 700,000 km (435,000 miles) is probably more than distance covered by an average person in a life time. This amazing technology is evolving rapidly.
  • One of the best part of this technology is the experience of cars fitted with this technology is shared with all other cars with the same technology just like a software upgrade.
  • As always regulation is several sometimes several hundred steps behind innovation so law makers are working around this new technology break-thru.

In a not too distant future if this technology were to become mainstream we were wondering what would happen to passenger car industry and us the consumers:

  • People would stop owning cars –  a smart entrepreneur or Google with a tie up with a car manufacturer could launch a taxi service of sort with thousands of cars fitted with the technology. So one would be able to book car which would come to their door step.
  • With a centralized service carpooling in real time would be lot more effective.
  • Driver driven taxi companies would cease to exist unless they migrate to this technology.
  • Few cities to handle traffic more effectively may even consider banning conventional (human driver driven cars) altogether –  since these self-driven cars can constantly communicate with each other in real-time they would utilize roads far more effectively.
  • Parking space would almost become redundant – when one can be guaranteed of availability of a car there is no point in blocking the asset. These smart cars can estimate their expected time of arrival (ETA) far more accurately than ever before as they can “talk” to other cars on the road.
  • The bottom line is demand for passenger cars would drop very significantly.
  • Cost of personal transportation would drop significantly – when the same technology is moved to public transport things get even better.

So here is Google, a super smart technology company with tons of cash which has been able to attract and retain some of the best brains in the world would start giving sleepless nights to auto executives.

Is this applicable to all the auto manufacturers?

May be not – just like mobile phones made wrist watch almost redundant, however luxury watch manufactures are selling more watches than ever before. So the utility of a watch to tell time is no longer the reason for which people by them.

May be the human tendency to be different from others kick-in and the very rich people would migrate to luxury cars.

So may be just may be the makers of Jaguars, Ferraris need not fear Google.

I would love to hear from you on what you think would be a possible fall out of this new technology.