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CEOs Take the Wheel in the Move to Self-Driving Cars

Self-driving consumer vehicles may be still at least five years away, but pursuing those far-off visions is reshaping careers, companies and entire industries in the here and now.

Self-driving consumer vehicles are still at least five years away. A fully autonomous personal transportation system in America is probably a generation away. But pursuing those far-off visions is reshaping careers, companies and entire industries in the here and now.

So, while his inability to move Ford fast enough into the autonomous-vehicle derby arguably cost CEO Mark Fields his job, across town at General Motors, much of the high regard for Mary Barra as CEO has come because of her bold moves in mobility services.

Under Barra’s leadership, GM has invested a half-billion dollars in Lyft, a ride-sharing rival to Uber; started its own car-sharing company, Maven; and recently dispatched 100 self-driving, all-electric Chevrolet Bolts around the GM Technical Center in Warren, Michigan, to see how they respond in the real world.

But when it comes to technological disruption, the real key to success for Barra and other automotive CEOs won’t be in comparison to one another, but whether they succeed in keeping the steering wheel of the car industry away from those grabby CEOs in Silicon Valley.

“We sort of see it as the
mother of all AI projects.”

Apple CEO Tim Cook rocked the business in June when he finally laid out the company’s focus on self-driving technology. “It’s a core technology that we view as very important,” he said in a Bloomberg interview. “We sort of see it as the mother of all AI projects.”

Perhaps they’re relieved that Cook at least has backed Apple off of its rumored initial intention to build its own autonomously piloted electric vehicle from the ground up. But legacy auto executives also are seeing Google’s Waymo unit, headed by former Hyundai USA CEO John Krafcik, and Uber, even without Travis Kalanick, head rapidly toward their own self-driving capabilities.

Still, there’s plenty of skepticism about whether people ever will really let go of the steering wheel. “Consumers, even millennials, are showing natural skepticism about self-driving,” says Reinhard Fischer, head of strategy for Audi of America. “If you ask, ‘Would you put your 10-year-old daughter in a self-driving car?’ people look at you and say no. But that doesn’t mean you should ignore the technology. That would be a big mistake. The question is, how do you deal with it and turn it to your advantage?”

For that reason, among others, there still are plenty of doubts as to whether heads of traditional auto companies ever will truly embrace self-driving, with its implications for fundamental change.

“Would you put your 10-year-old daughter in a self-driving car?”

“They’re making all the right bets now, but at some point, they’ll face a Kodak moment where they’ll have invested in all of these technologies, but then they have to have the guts to make a massive transition to a new world order when they’ve got all these legacy assets in manufacturing,” said Julian Birkinshaw, a professor at the London School of Business. “Will they have the will to close down large factories? Whereas if you’re Tesla, or BYD in China, without those legacy assets, self-driving will be a much easier decision.”

Meanwhile, autonomous driving already is disrupting all sorts of business-to-business forms of transport. It’s the job of an estimated 8 million Americans to drive a vehicle, and from trucks to taxis, those jobs are increasingly endangered by new, technology-driven commercial realities.

For example, in happier times, Uber acquired Otto—which is pioneering autonomous-truck delivery—for $680 million in 2015. By late last year, Otto had outfitted a beer truck with $30,000 worth of hardware and made the first self-driven beer run, transporting 50,000 cans of Budweiser about 120 miles via interstate from Fort Collins to Colorado Springs, Colorado.

Ultimately, Otto’s goal is to make human truck driving a merely local industry, as drivers’ main job will be to meet trucks at the Interstate after they’ve driven themselves on trips of up to several hundred miles and then pilot them to the dock at their ultimate destination.


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