Almost a decade has passed since the debut of the Spyder 918 concept in Geneva back in 2010. But it was not just until recently that the official price surfaced: $845,000. And as most know this is not the true price seeing as how a massive list of optional equipment will likely push this guy […]
Audi has started a thunder race of sorts,or perhaps better thought of as a mind race, as it competes with arch names Benz and Bimmer for the luxury car of top-selling brand by 2020.
3D printing will begin to appear in other areas, such as basic car construction done by mainstream carmakers and new players like Local Motors, a low-volume manufacturer of open-source vehicles. After all, 3D printing makes it cost-effective to build things, challenging today’s fundamental approach to car design.
Augmented reality will assist driver safety and impact areas from designing to repair. While virtual reality creates a simulated world, augmented reality adds specific, created elements to the real world via technology.
There are many factors weighing in on the future of auto makers and vehicle trends for this year. Like any industry there is a series of challenges expected with growth and change.
4. Autonomous vehicles continue to drive the industry
2017 will see a flurry of new autonomous functionality appearing in almost every new car. Autonomous capabilities like self-parking and adaptive cruise control will be available from virtually every auto OEM in new vehicles. This movement is unstoppable and, while driverless cars themselves won’t populate the road in 2017, the direction seems clear. Tesla and Google are also making inroads into producing road-legal driverless cars. Just one example of a big step forward next year will be some high-profile trials of techniques like platooning, in which convoys of driverless vehicles follow each other to reduce congestion.
And don’t forget that Ford already announced its plan to mass-produce autonomous vehicles by 2021. The fact that one of the world’s oldest, largest, and most successful automakers is rewriting decades of standard practice to satisfy companies one millionth its size, evinces the scope and speed of the change rocking its industry. Ford, GM, Audi, BMW, Tesla, Nissan, Mercedes-Benz, and others have promised to deliver self-driving cars in the next five years or so. These newly forged partnerships are a vital part of making that happen.
The goal is always the same: Reduce cost and complexity—and increase profit—by joining forces with the folks whose strengths match your weaknesses. Every other serious player in the autonomous car space is doing the same. Last year, General Motors bought self-driving startup Cruise, and Nissan shacked up with NASA.
Mobileye, the largest supplier of cameras for self-driving cars, is now working with major industry supplier Delphi, plus Intel and BMW. Uber is working with Volvo to strap self-driving add-ons to real vehicles. Volvo is also partnering with Autoliv. Those two companies are lending employees to a joint project called Zenuity, to share patents and ideas. “You have the old established industry, trying to automate their vehicles, but you also have the tech companies coming in from the left with new, more disruptive ideas.” says Thomas Jönsson of Autoliv, a leading supplier of car safety systems.
China plans to build the world’s largest autonomous driving test zone from this year in the south-eastern city of Zhangzhou in Fujian province. The project was signed off in December and involves building autonomous driving infrastructure, including traffic signs, in a 56 sq km area in Zhangzhou’s economic and technological development zone. The zone will become a real-life lab for autonomous vehicles. The city also plans to build a 60,000 sq m in-door experimental laboratory and a 2m sq m open-air testing ground.
It means that driverless cars are approaching reality. The industry is moving past the oh-so-easy to build a concept car (ahem, Faraday Future), and flashy demonstration videos filmed in one, experimental vehicle (ahem, Tesla). It’s a lot harder to create a stable and long-lasting business that makes money building millions self-driving cars, but that’s exactly what companies, large and small, are working to do.
5. Machine learning-based vehicle cybersecurity
The cat-and-mouse game that defines existing vehicle security features could use an overhaul and the recent resurgence in artificial intelligence technologies is just the thing to deliver it. Today, the networks on wheels that are modern cars use anti-virus and other common software security technologies that identify known threats and try to quarantine some of the unknown ones. But this isn’t ideal in a dynamic area where new threats continually pop up.
Machine learning in the AI space lets computers learn without being explicitly programmed, getting more adept when exposed to new data. These cybersecurity systems are self-adapting and self-defending, creating ways to guard against new threats without any humans needing to program the system to identify specific incoming trouble. Among early adopters, these solutions should start appearing next year.
Toyota recently announced the Concept-i at this year’s Consumer Electronics Show (CES) in Las Vegas. The concept vehicle promotes a welcoming, fun, and user-friendly automotive experience. Artificial intelligence (AI) creates a system that promotes a truly unique relationship between human and machine.
The concept car employs multiple tools to measure emotional states, which are analyzed against the driver’s travel plans, mixing mobility with life improvements. Not only that, but the AI-system uses advanced automated driving software to increase safety while on the road. This is achieved by combining visual and haptic stimuli to gauge communication decisions based on the driver’s responsiveness.
When the driver switches between manual and autonomous mode, the Concept-i continually monitors the driver’s attention and current road conditions. Avoiding the center console to display information, subtle rear-deck projectors show blind spot warnings, ensuring the driver is always attentive and alert.
„At Toyota, we recognize that the important question isn’t whether future vehicles will be equipped with automated or connected technologies,“ says Bob Carter, senior vice president of automotive operations at Toyota. „It is the experience of the people who engage with those vehicles. Thanks to Concept-i and the power of Artificial Intelligence, we think the future is a vehicle that can engage with people in return.“
6. Car-sharing: Collaborative monetization to see exponential growth
While it goes in a different direction than the auto industry’s traditional go-it-alone approach of vertical integration years ago, today’s world demands that auto companies collaborate in areas outside their space and seek ways to make new profits from disrupting trends.
This year will see more of such activities, like using car- and ride- sharing as a means to create new residual value in their cars and engage with a new consumer demographic.
More auto OEMs will make moves like creating leasing organizations and dealer networks that are able to deal with partial ownership and vehicle servicing. And importantly, with the right offering, they can reach new drivers and create brand-specific loyalty.
Many of the car-sharing business models will act as a pay by the minute or mile, or a combination of the two, where OEMs will still own the physical asset. This will allow the OEM to amortize car cost across many transactions, not just a single sale — creating better profitability options.
Swedish automaker Volvo is establishing a car-sharing business that will operate not just in Sweden, but in other countries across the globe. It will be based on Sunfleet, the car-sharing service that it’s been running in its homeland for decades. According to TechCrunch, you can avail of Sunfleet’s services by booking a car through its website, which you can then unlock with an app. While you can book a car for a day or two, you can also set up a monthly subscription. The new business will likely offer something similar, though the company says it will also introduce „an entirely new range of mobility services.“ Who knows — someday that might even include the ability to rent one of its self-driving vehicles.
The company joins the list of automakers with their own car-sharing service, such as GM’s Maven that already operates in several cities across the US. BMW has ReachNow, Mercedes-Benz has Croove in Germany, while Toyota has begun testing its keyless car-sharing service last year.
Cities Examples: San Francisco, Tel Aviv and Seattle
San Francisco’s on-street car-sharing program is at a crossroads. After a two-year pilot, which 200 parking spaces were designated for car sharing — a majority in the northeast neighborhoods — the San Francisco Municipal Transportation Agency will decide whether to expand the program. The discussion comes as San Francisco’s parking is becoming increasingly congested with new uses like Uber and Lyft, Scoot (an electric motor scooter rental) and bike sharing.
Tel Aviv on Sunday unveiled its municipal car-sharing plan that will let users rent one of 260 vehicles to be dispersed around the city on a short-term basis, measured in minutes, when the program is launched this fall. Officials said they hope the Tel-Auto program would help alleviate the city’s chronic traffic and parking problems, even though the plan calls for reserving 520 parking spaces around the city for the cars. “We are going ahead on the assumption, based on similar systems around the world, that every shared car reduces by four the number of private cars on the roads,” said Mayor Ron Huldai at an event for Tel-Auto. “In Israel, a project like this is important because 20% of the time – Sabbaths and holidays – there’s no public transportation.”
As the headquarters for BMW’s ReachNow car-sharing service, Seattle will be one of the first places people get to try out BMW autonomous vehicles. Steve Banfield, CEO of ReachNow, said Thursday at the Economic Development Council of Seattle & King County annual Economic Forecast Conference that BMW will test out its eventual self-driving fleet through ReachNow. The company reportedly plans to test driverless cars in Germany this year. “The benefit to having ReachNow in your region, is that you are going to be the first people to try autonomous cars from BMW,” Banfield said. “We are going to bring them here and we are going to be able to use them and test them.“ ReachNow only launched nine months ago, but it has grown fast. In that time period, it has expanded service in Seattle and come to Portland and Brooklyn. The number of users now sits above 40,000, Banfield said Thursday.
Blockchain technology, the foundational infrastructure of the cryptocurrency Bitcoin, is a timestamped ledger of transactions distributed over a network of computers. If each auto part were assigned a unique code, blockchain would enable auto manufacturers to track each step of the production and transportation process through a secure database updated by suppliers in real time.
Donald Trump has pledged to revitalize the mainly white working class that elevated him, a tough task given an aging U.S. workforce, dwindling options for people with little education and years of stagnant pay. Trump has said he’d slash taxes, strong-arm U.S. trading partners, end commitments to environmental rules and make it easier to drill for oil.
In January this year, senior diplomats from around the world formally announced the lifting of sanctions against Iran. In principle this put a definitive end to 37 years of various degrees of sanctions imposed on the country.
Let’s have a look at the past. ILIA Corporation, a management consulting firm in Iran wrote in a very interesting report explaining all the challenges Iran is facing, and give us some clues.
1. Iranian Automotive Industry: Past to Present
The benefits of developing a domestic automotive industry are significant. The worldwide automotive industry is estimated to have a total cash flow of more than 2,790 billion USD with a total production capacity of approximately 90 million and it employs more than 48 million people (directly and indirectly). Accumulated this would make up for the 7th biggest economy of the world.
The first Ford Model T’s arrived in Iran in the 1930s and by 1955 annual imports had soared to approximately 10,000 units. Nowadays the domestic Iranian automotive industry is estimated to have a yearly nominal production capacity of 2 million cars. It employs more than 1.5 million people (directly and indirectly) making up for 12% of the countries workforce.
Furthermore it has a daily nominal production capacity of 10 million components whilst drawing input from sixty related industrial fields. With total sales of 12 billion USD it makes up for approximately 19% of the total industry, as well as for approximately 2.5% – 3% of Iran’s GDP. The Iranian automobile industry makes up for 1.2% of world production, and currently holds rank 18 to 20.
Several national brands exist, such as IKCO, SAIPA, Pars Khodro, Kerman Khodro, and Bahman that produce a variety of different models (such as Samand, Tiba, Dena, etc.). IKCO and SAIPA are the biggest automotive manufacturers and together own more than 79% of the total market share.
Iran also looks at its automotive industry as an important sector for exporting its products to neighboring countries. In 2012 Iran exported 520 million USD worth of automobiles and car components. The situation for car and component manufacturers worsened in the following years, leading to a diminishing export value by 2013 to 263 million USD. In 2014 Iran’s share of exporting automobiles and car components was announced to be at 243 million USD. There are several reasons for the drop, however, experts concur that the key reasons are low quality and at the same time a high price.
Currently the Iranian automobile import market is ranked on 75th place worldwide, making up for less than a percent of the global automobile and component importing market share. In 2010, its market share was 0.2 percent with a total value of 2.5 billion USD. During 2011 the market share did not change, however, the total value of it increased to 2.9 billion USD. Economic sanctions were a big setback for Iran’s automotive industry, especially at a time when the industry was ready for major expansion. Since the year 2012 the production output decreased by approximately 50% (from 1.4 million to 0.7 million), whilst at the same time the price of cars increased radically by about 300%.
2. Sanction: Situation and Impacts
Over the past years sanctions have had a serious effect on Iran’s economy and its people. Since 1979 the United States has led international efforts to utilize sanctions in order to influence Iran’s policies, including Iran’s uranium enrichment program which Western governments fear is intended for developing the capability to produce nuclear weapons. Iran counters that its nuclear program is for civilian purposes, including generating electricity and medical purposes.
Prohibitions and / or restrictions on: The import, purchase, transport, financing and insurance of Iranian crude oil and petroleum products; Transfers of funds between EU and Iranian banks and financial institutions; EU based sales, supply, export, transfer, purchase, import or transport of equipment or technology in relation to crude oil.
The US sanctions on Iran relate to:Iranian petroleum industry; Imports from Iran; Exports to Iran; Dealing in Iranian-origin goods or services; Financial dealings with Iran.
Despite the fact that Iran’s economy has been suffering from the effects of intensified international sanctions since 2007, different industrial sectors have shown deviating levels of instability. Since 2010, the Iranian total passenger car production dropped considerably, as a direct effect of the sanctions impact on the automotive sector.
3. How Iran’s auto industry became the new domestic political football
Alireza Ramezani in al-monitor.com reports : „At the last Paris Auto Show, Renault Chairman and CEO Carlos Ghosn and Mohammad Reza Nematzadeh, Iran’s Minister of Industry, Mine and Trade, signed on a strategic agreement for a joint venture car-plant, where Renault is a majority shareholder. Iran Khodro and Saipa, Iran’s largest automakers, are other members of this agreement.“ Iranian hard-liners have launched a new attack on the administration of President Hassan Rouhani, this time focusing on the country’s automotive industry. At an Oct. 25 parliamentary hearing, the Industries and Mines Committee grilled Industry, Mines and Trade Minister Mohammad Reza Nematzadeh over a deal he made recently with the French automaker Renault.
A new joint venture plant is being set up in Iran for making the Logan and Duster models. The Renault Kwid is currently under consideration for manufacturing in Iran, as the French carmaker eyes the potential of the Iranian automobile market (Iran is projected to be a 2 million-vehicle market by 2020). The JV plant will have an initial production capacity of 150,000 vehicles per year, and will adapt an existing plant in Tehran. Initially, this plant will make the Renault Symbol sedan (Renault/Dacia Logan) and the Renault Duster beginning in 2018.
However, both Iran Khodro and Pars Khodro (a subsidiary of Saipa) are looking to manufacture the Renault Kwid. Bernard Cambier, Renault senior vice president and chairman-Africa-Middle East-India Region, in a recent interview to WardsAuto, stated that the Kwid, if made in Iran, will be “very successful”.
Nematzadeh also came under fire over a controversial decision that critics say led to the import of 400 BMW, Toyota, Volvo and Honda vehicles manufactured in the United States, in contravention of guidelines barring the import of American-made cars. On Oct. 26, the Student News Network (SNN) published a report criticizing the import of US-made cars but did not refer to the hearing. Citing a number of pundits, SNN argued that the import had been unwise, because Washington’s “hostile” policies have for decades been damaging for Iranian consumers. “Cars that are made in the US, irrespective of whether their brand origin is American, European or Asian, create value added for American companies and boost employment in the US. We should not use Iranian money to create jobs for Americans,” Hassan Karimi Sanjari, an automotive expert, said in an interview with SNN.
A day before the hearing, Donya-e Eqtesad, Iran’s leading economic daily, had reported that authorities had banned the import of European cars produced in the United States. The Industry, Mines and Trade Ministry, however, has not yet officially announced such a ban.
Another concern among parliament members was the direct involvement of Nematzadeh’s ministry in the car market. Nematzadeh said that his ministry seeks to attract foreign investment in the automotive sector to upgrade manufacturing technology and provide Iranians with high-quality cars at competitive prices. He called Renault an “appropriate partner” that could can help Iran finish a key automotive development project given the company’s 12-year presence in Iran. Members of parliament called on Nematzadeh to obtain a guarantee from French automakers, including Renault, Peugeot and Citroen, that they will not repeat their “wrong behavior” of the past, Bastani said, referring to how Renault and Peugeot had pulled out of Iran in 2012 when economic sanctions intensified.
A German business consultant who counsels a number of European and Asian carmakers operating in Iran told Al-Monitor that such guarantees are difficult to come by. “It doesn’t matter what type of contract you sign with a foreign company. If Iran comes under the same serious sanctions as before in the future, none of the European automakers will stay in the market,” the consultant said. “Stability is super important,” he stressed, while criticizing how numerous actors have a finger in Iranian market policy although such decisions need to be made by the Rouhani administration alone.
Of note, in the last few months IKCO and SAIPA have resumed cooperating with Peugeot and Citroen. That three major partners in Iran’s automotive industry are French has raised concerns among some lawmakers about the future of the industry in the event of renewed external pressure. Under the IDRO-Renault contract, Renault is committed to producing 75,000 cars at Bon Roo, the manufacturing site previously owned by SAIPA before IDRO seized it as part of a debt settlement. The French company is also committed to investing in the site to double annual production in the next phase and eventually achieve an output of 300,000 vehicles a year in five years.
Domestic automakers also complain that under current regulations, manufacturing vehicles whose technology is not yet fully localized is not economical, pointing out that producing such low-quality cars as the Tiba, Samand and outdated Peugeot 405 and Pride models makes much more sense than manufacturing the more advanced Logan (Tondar 90), which requires foreign parts.
An open question : Will the US elections rebuff the game?
In gulfbusiness.com, Erika Masako Welch explains : Iran opening up to the world is arguably one of the most prolific global business opportunities of our generation. For the majority of the largest European and Asian companies (excluding China), this marks a much-awaited opportunity to return to Iran, where many had investments, manufacturing facilities and large-scale operations prior to the financial sanctions made against Iran in 2011.
Chinese and American companies view the current situation as more of a threat, and for different reasons. Chinese firms have greatly benefitted from the international sanctions on Iran over the past few years, which provided a window where an inflow of Chinese products flooded the market without much foreign competition. The lifting of sanctions will see an inevitable curtailing of Chinese dominance in this market.
For American companies, the situation is more complicated. Although US companies’ foreign subsidiaries are technically allowed to engage with Iran, there is still a minefield of regulatory, transparency and legal challenges that have left many hesitant to take even preparatory steps. Furthermore, the fact that 2016 was a US Presidential election year, and the mounting layers of uncertainty of the future government’s policies towards Iran have left the majority of American companies unable to decide.
Trump’s surprise victory is posing a potential threat to investments by Renault and PSA in Iran. During his campaign, the real-estate tycoon pledged to unpick the North American Free Trade Agreement (NAFTA) as well as a breakthrough nuclear pact with Tehran, saying both were among the worst deals ever made.
Next article : Trump’s Election may or may not damage global auto trade?
Here is a great article from cbinsights.com
With expectations rising around the promise of driverless vehicles, 15 investors and executives sound off on the future of mobility and the auto industry.
Auto tech is drawing more attention than ever as venture capitalists, startup founders, and industry stalwarts aim to profit from the evolution of the trillion-dollar automotive sector. Private markets investment into auto tech is on pace for a record year, and numerous corporations have laid out plans for the development of autonomous vehicles.
To understand sentiment around the suddenly-dynamic auto tech space, we gathered 15 perspectives, from Silicon Valley investors and startup founders to regulators and big auto executives. If we have missed any viewpoints that you think are worth highlighting, please let us know in the comments.
Mark Fields, the Ford veteran who succeeded Alan Mulally as president and CEO of the company in 2014, recently penned a Medium post laying out Ford’s path to fully autonomous vehicles. Fields also used the post to announce a flurry of startup investments and M&A to propel Ford towards that goal. Most notably, Fields announced that the company would diverge from the stepping-stone path of many automaker peers, joining Google and others in racing directly to full autonomy.
“As little as four years ago, our approach was aligned with the thinking of most automakers today, which is taking incremental steps to achieve full autonomy by advancing driver assist technology. This is not how we look at it today. We learned that to achieve full autonomy, we’d have to take a completely different pathway.
So, we abandoned a stepping-stone approach and created a dedicated ‘top down’ engineering program to deliver fully autonomous vehicles and the new mobility solutions and business opportunities that a fully autonomous vehicle could deliver.”
Uber’s CEO cited the advent of self-driving vehicles as an “existential threat” in rationalizing the ride-hailing company’s aggressive moves in the space and purchase of Otto. He also expressed optimism around employment prospects in the driverless future.
“So, if we are not tied for first [in driverless], then the person who is in first, or the entity that’s in first, then rolls out a ride-sharing network that is far cheaper or far higher quality than Uber’s, then Uber is no longer a thing … But this is a years thing, not a decade thing.
I don’t think the number of human drivers will go down anytime soon. In fact, I think, in an autonomous world, it goes up. In absolute figures. Of course, in percentage, it’s down. But then you also think, what about the tens of thousands of jobs that are necessary to maintain that fleet?”
Amid the first fatal accident involving an Autopilot-driven Tesla, the head of the US NHTSA strongly backed self-driving technology. He emphasized that the safety of autonomous vehicles would be carefully evaluated, but the agency would not wait for perfection. The administrator also expressed his agency’s neutrality on the varying development approaches for the technology. These stances have since been backed by the NHTSA’s official guidance policy.
“Of course we have to do everything we can to make sure new technology does not introduce new safety risks, but we also can’t stand idly by while we wait for the perfect … If we wait for perfect, we’ll be waiting for a very, very long time. How many lives might we be losing while we wait?
The federal government is not here to pick the winners and losers of this technology. We are neutral on the question of incremental technological development versus skipping to full automation. Our mission is not to design the future, but instead lay the framework, a framework that will speed the development and deployment of technologies with significant lifesaving potential. We are open to anything that fulfills that mission.”
Josh Kopelman, who came in fourth in the CB Insights and New York Times ranking of the top 100 venture capital professionals, discussed autonomous vehicles in a Medium post last August. He likened the current state of automotive technology to the “300 baud phase” of consumer internet, and laid out several areas of investment interest despite giving a relatively conservative timeline for autonomous transport.
“I have a teenage daughter, and in a few years, she’s going to get her driver’s license. (Which terrifies me.) And while there have been incredible advances in autonomous vehicles over the last few years, I’m certain that she’ll still need to learn how to drive — the technology and regulatory environments just aren’t changing that fast. That said, after spending some time over the past few months looking at the autonomous vehicle landscape, I’m also equally certain that in 35+ years (when my daughter might have a teenage child), my grandchild will not know how to drive.”
Amidst all the hype surrounding autonomy and next-generation mobility, Bilal Zuberi instead weighed in on automotive interiors and the suppliers that provide such systems. He is bullish on the ability of startups to upend the byzantine option packages and lackluster technology commonly associated with today’s cars.
“Everything inside the car may be up for grabs. Consumers have endured crappy technology inside cars for too long, and have survived ridiculous prices to get various ‘upgrade packages’ installed … But a radical transformation is coming and a gigantic industry of inside-the-car components and systems that has been dominated by Tier 1 suppliers may be up for grabs.”
Lee Hower has penned a series of posts on the future of auto tech. Like Josh Kopelman, he is excited by the prospect of fully autonomous vehicles, but also holds a more conservative outlook on their timetable given the scale of the “nearly unbounded” driverless problem.
“It isn’t because of lack of interest or investment in vehicle autonomy … That said, there’s no way you will be able to buy / rent / hail a fully autonomous vehicle in the next couple of years. Level 4 autonomy on public roads is a nearly unbounded problem… driving on a highway at 60+ mph or being able to self-park is a totally different challenge than navigating a poorly marked, chaotic urban downtown. Autonomous vehicles that work anytime, anywhere, and in any conditions are still quite a ways off.”
Upon announcing Andreessen Horowitz’s $3.1M seed investment in George Hotz’s comma.ai, Chris Dixon highlighted the democratization of deep learning knowledge as a key driver of autonomous vehicle development.
“WhatsApp was able to build a global messaging system that served 900M users with just 50 engineers, compared to the thousands of engineers that were needed for prior generations of messaging systems. This ‘WhatsApp effect’ is now happening in AI … I tested [George’s] car, and, along with some of my colleagues and friends with AI expertise, dug into the details of the deep learning system he’d developed. I came away convinced that George’s system is a textbook example of the ‘WhatsApp effect’ happening to AI.”
The co-founder of Parse and Scribd was an early investor in Cruise Automation, the self-driving tech startup acquired by GM in March 2016 for upwards of $1 billion. Tikhon is bullish about the opportunities for investing in autonomous transport startups, citing the wide array of existing stakeholders that may be hungering for M&A opportunities.
“With a company like Cruise, worst-case scenario, especially for a seed round, is that you are going to 5X your money because there are so many acquirers. You just have to hope they don’t want to sell too early because they’ll likely be getting a lot of M&A offers along the way — not just from the usual suspects like Apple, Google, Tesla, Uber, but also all the car manufacturers … GM plus Cruise is certainly worth more than GM alone, with another billion in the bank.”
The GGF team at Kleiner Perkins sees the future of transportation revolving around the themes of “Shared,” “Autonomous,” and “Electric,” with the three trends converging to create a positive feedback loop of innovation, and the car itself becoming less critical.
“Automotive executives often forcefully and convincingly contend that they will not become handset makers to companies like Apple and Google, who want to own the ‘brains’ inside the cars. The reality is they have a choice to make: Would they would rather be BlackBerry, which continued to try and own the hardware and software in a walled-off OS to the detriment of its customers (market cap $4 billion) or Foxconn, which is now a key manufacturer of the iPhone (market cap $89 billion)?
Is Detroit still relevant? Yes. Are Geneva [auto show] and CES [consumer electronics show] also relevant? Yes. Is the car itself relevant? Not as much.”
In April 2016, Playground Global participated in a Series A round to Nauto, an auto tech startup focusing on advanced driver assistance systems (ADAS), connected vehicles, and data. Bruce, the co-founder of the hardware incubator, sees this area — driver assistance as opposed to driverless systems per se — as a “sweet spot,” where startups can monetize and amass data on the road to full automation.
“We all realize autonomous driving is the future, but how do we get there? Working with OEMs is a good strategy; it’s just a long, hard path to revenue. But it’s a nice insight Nauto has — the automotive industry wants to work with proven leaders in the field. [So] the company just said we have to get millions of miles of experience. The only way to do that is to have people behind the wheel.”
Despite potential upheavals on the horizon for established automakers, Mary Barra has characterized ongoing trends as opportunities for GM. Rather than brushing off increased interest in autonomous driving, connectivity, and ride- and car-sharing models, the GM CEO pledged to embrace these trends. Indeed, the 107-year-old company has backed up Barra’s remarks with aggressive acquisitions, investments, and R&D spend.
“We are moving from an industry that, for 100 years, has relied on vehicles that are stand-alone, mechanically controlled and petroleum-fueled to ones that will soon be interconnected, electronically controlled, and fueled by a range of energy sources. I believe the auto industry will change more in the next five to 10 years than it has in the last 50, and this gives us the opportunity to make cars more capable, more sustainable and more exciting than ever before.”
Additionally, in a May 2016 statement, the head of General Motors’ foresight and trends unit Richard Holman credited Silicon Valley companies for “[forcing] the issue” in the development of autonomous vehicle technology, a rare hat tip from Detroit to the technology industry.
The former Hyundai and Truecar executive has emphatically backed Google’s ambitious self-driving plans. Unlike many other driverless developers, Google believes the safest route is to eschew incremental advances and move directly to total autonomy.
“The industry has been making continuous incremental gains, but for self-driving cars to reach their full potential we need to focus on nothing short of full autonomy … Aiming for full autonomy not only reaches the most people, our team believes it’s also the safest approach. Having this audacious goal was what drew me to the Google self-driving car project.”
The BMW board member acknowledges that the German luxury automaker has technological ground to make up in the race towards autonomous vehicles, which likely drove its tie-up with Intel and Mobileye. Froehlich invokes fears that legacy car manufacturers will become contract OEMs delivering “metal bodies” — in the vein of electronics-manufacturing businesses — while tech companies control the brains of the vehicles.
“For me it is a core competence to have the most intelligent car. We have some catching up to do in the area of machine learning and artificial intelligence … Our task is to preserve our business model without surrendering it to an Internet player. Otherwise we will end up as the Foxconn for a company like Apple, delivering only the metal bodies for them.”
One of the most vocal proponents of auto tech and autonomous vehicles, Elon Musk is unsurprisingly optimistic about both the substitution of human drivers with technology and his company’s ability to deliver on that promise.
“I think [autonomous cars are] just going to become normal. Like an elevator. They used to have elevator operators, and then we developed some simple circuitry to have elevators just come to the floor that you’re at, you just press the button. Nobody needs to operate the elevator … Autonomy is really about what level of reliability and safety do you want. Even with the current sensor suite we could make the car go fully autonomous, but not to a level of reliability that would be safe in, say, a complex urban environment at 30 miles per hour where the lane markings aren’t there and children are playing and things could be coming at you from the side. In order to solve that you need a bigger sensor suite, and you need more computing power … But, and this may sound a little complacent, I almost view it as a solved problem. We know exactly what to do, and we’ll be there in a few years.”
Toyota’s top executive, a driving enthusiast who has opposed autonomous vehicles in the past, has recently begun to embrace the concept as rivals have accelerated development. He has also speculated on the broader implications of self-driving research in the fields of robotics and AI.
“I personally went through a big change in my thinking. I believe there is a point in Toyota participating in the field of autonomous driving. And we’ve got the resources to do so … I have hopes that what we are studying now could be used beyond the automotive business … [Freedom is] an element that cars should never lose. No matter what, cars need to win the love of their users.”
Morocco Automotive Industry has grown substantially in recent years thanks to the Casablanca Industrial Zone and the Tangier Med Zone, and Kenitra Free Zone, offering fiscal incentives and modern infrastructures.
Morocco has aggressively marketed itself as the new regional automotive hub for global automotive players. According to a 2013 report by PwC, the Moroccan Kingdom will be among the top-20 largest vehicle producers in the world by 2017. Renault, Delphi, Lear, Leoni, Yazaki, Faurecia, Sumitomo, and Hirschmann Automotive are some examples of key investment projects in recent years. These companies are not just providing employment, but are also supporting a thriving automotive SME sector. According to Moulay Hafid Elalamy, Minister of Industry, the auto industry’s local integration rate is projected to reach 65% over the coming years, suggesting significant growth prospects for local industry.
A €246.9m agreement was signed with Canadian supplier Linamar, which plans to open Morocco’s first engine component production facility, creating around 1000 jobs. The plant will supply leading international automakers, including Ford, Volkswagen and Peugeot Citroën, whose new factory in Kenitra is expected to come online in 2019, producing around 200,000 vehicles per year.
The auto industry features prominently in the country’s Industrial Acceleration Plan 2014-20, which aims to improve Morocco’s trade balance, increase the industrial sector’s contribution from 14% to 23% of GDP and create 500,000 new jobs through the development of “ecosystems”, or productive industrial clusters.
RENAULT INVESTMENT PLAN
Morocco’s car industry attracts more and more investors. Renault, which owns 80% of the Casablanca plant, is the only manufacturer in Tangier. Indeed, with the Strait of Gibraltar separating Morocco and Spain by just 13 km, the Moroccan industrial policy is clearly to develop its auto sector fast.
Renault Group plans to invest more than $1 billion. The manufacturer announced their brand have produced 288,053 cars in 2015, an increase of 26% in Morocco. Renault manufactures four models in Morocco. The Sandero is the most produced with 143,049 units. They account for half of the production. In terms of numbers, the French group announced 9,653 employees in total in its two plants as well as in its commercial network, an increase of 20.6% in one year.
According to Medias24.com, french car parts supplier Valeo plans to invest 50 million euros in a new industrial center in the port of Tangier. Production, which will take place inside the Tangier Automotive City (TAC), will supply Peugeot-Citroën in Kenitra and Renault Tanger Med. Construction work is expected to begin in coming weeks and should be completed during 2017, the port authority said.
The new CEO of Renault Morocco, Marc Nassif, made a deal with the Moroccan government for the creation of an ecosystem with suppliers in the kingdom and a target of 65 % local sourcing against 40% today; a project that should require 900 million euros investment by 2023. Renault wants to increase its industrial influence in Morocco. According to Renault, Morocco is one of the countries that have made most progress in the area of industrial manufacturing. Renault ecosystem means that around Renault plants, in Tangier and Casablanca, many other companies are coming to invest and make the parts that will shape a Renault car, the Minister of Industry added on Reuters.
Renault Tanger Méditerranée
On 9 February 2012, in Morocco, phase 1 of the Renault Tanger Méditerranée plant was inaugurated in the presence of King Mohammed VI of Morocco and Carlos Ghosn, Chairman and CEO of the Renault-Nissan Alliance. Phase 1 will see the construction of 36 buildings, including 180,000 sq. m of industrial buildings (drawing, sheet metal work, painting, assembly, bumpers, exhausts, seats, etc.); 20,000 sq. m of service buildings (administration, cloakrooms, training-center) and utilities (energy and biomass plants, physical-chemical facilities, service station). In phase 2, the industrial buildings will be extended by a further 125,000 sq. m and the services buildings by 4,000 sq. m (cloakrooms).
Jacques Prost, the former CEO of the brand said “Renault factory in Tangier aims at increasing its production capacity to 225,000 vehicles annually.” Marc Nassif explained to Usine Nouvelle: “We carried 240,000 vehicles last year, I told you we should be at 10% more this year, about 270,000 units.
RENAULT AND SUEZ GROUP PARTNERSHIP
Environmental services firm, SUEZ and Renault Group have renewed a deal for the global management of waste from the car manufacturer’s two production plants in Tangier and Somaca. According to SUEZ, the three years contract is clearly helping Renault to improve its performance in Morocco. This new contract stipulates that SUEZ will collect and sort the waste, then dispatch it to different facilities for material recycling or treatment. Thanks to this contract, SUEZ said that it is positioned as a ‘standard‐setter’ in the management of industrial waste in Morocco, with the ambition to achieve a ‘zero waste’ objective at Renault’s factories.
“Our plant in Tangier, Morocco is the first factory in the world to produce zero CO2 emission and zero industrial wastewater. Through our partnership with SUEZ, we are consolidating our environmental initiatives”, commented Marc Nassif. Marie‐Ange Debon, group senior executive VP of SUEZ, in charge of the International Division added: “As Morocco prepares to host the COP22, this waste recovery system shows how industrial manufacturers are committed and key players in the sustainable management of resources and the fight against global warming.”
In our next article, we will continue our Automotive industry tour with Iran.