Get ready for a thermonuclear autonomous ride-hailing war

On Thursday, Ford CEO Mark Fields announced the company’s first autonomous car will arrive in 2021. That big news—even if the launch date is timid from the company that invented the first affordable car—but the even bigger story is a ride-hailing app will be the easiest (and cheapest) way to ride in the unnamed autonomous car.

Ford did not name the ride-hailing app it plans to launch in major cities, but it is clear the company is positioning for its own stake in the ride-hailing industry. Its not hard to see why,estimates from economists and transport experts say car autonomy will reduce car sales and car ownership, which takes a slice out of the automotive industry’s pie.

Uber, Lyft, and Didi are the three major firms that stand to gain from the reduction in car ownership, but they won’t be alone in the battle to win the ride-hailing market.

Automotive firms are gearing up for the battle of their lives. General Motors spent $600 million on a 40 person automation startup; Volkswagen, GM, Daimler, BMW, and Ford are all working on ride-hailing apps; Toyota, GM, Ford, Audi, BMW, and others have opened Silicon Valley offices and spent more on R&D than ever before.

Not to mention Apple and Google, the two most valuable companies in the world, are both working on self-driving and ride-hailing services.

A new world ride-hailing war?

Automotive firms are putting on their cooperative face, but come 2020 there will be thermonuclear war for ride-hailing market share. Every automotive firm will have its own ride-hailing app and software will be inserted into the car to make sure Uber, Lyft, or Didi can’t hijack it.

For Uber and Didi, that might force them to acquire an automotive manufacturer. For others that have less than $5 billion tucked away, it likely means lights out. Lyft could become an independent subsidiary of GM (or another larger company), a similar situation could play outin Europe with Gett and Volkswagen.

Partnerships may work for a time, but automotive firms have the power. Apart from Uber and Didi—who are building their own autonomous systems—automotive manufacturers will provide the hardware and software, putting them in a clearly advantageous position.

Volvo and Fiat are providing 100 cars to Uber and Google, respectively. It should be noted these two firms will have limited reach in the self-driving world, compared to major automotive manufacturers. In the future, we may see Uber, Google, or Didi dictate the design and production of the car, to meet standards, while the two firms have independent leadership.

Room for more?

The ride-hailing industry should look like the auto industry today, once the dust clears. Ford, GM, VW, and the other major suppliers will have the largest volume of cars on the road, while others attempt to win customers over with unique design, better software and services, or lower rates.

This only works if automotive manufacturers block ride-hailing services from adding software to their cars. If not, Uber takes control. Most affiliate ride-hailing with Uber, it will be nearly impossible for one of the upstarts (apart of Didi) to match the purchasing power and scalability of Uber.

Apple may make inroads, as it is able to provide the full package, but it may take the iPhone maker a few years to reach the scale of GM and Ford, who in this scenario are providing cars directly to Uber.

For the health of the auto industry, the former option; having manufacturers provide the ride-hailing services for their own cars, looks best. Some manufacturers will be unable to compete with Uber’s pricing and speed, but at least in this future customers have the choice of several operators, rather than the entire industry belonging to Uber.

The future of car ownership

It is unlikely that Ford, GM, and others will ban ownership out of the gate. Instead, it is likely that changes in cost, city planning, and laws will make ownership more exclusive and less enjoyable.

Prices will be too high for most families, while ride-hailing becomes much more affordable.City planners will remove parking garages and ban parking on the side of the road for extended periods of time. Driver’s licenses will become near impossible to obtain, unless you have clear sight, a clean record, and perfect understanding of all road signs.

Some may continue to purchase cars and be distrustful of autonomy, but most will conform once the economical advantages become obvious. Even fans of cars that add customizations will start to see their pastime fade, as the steering wheel, brakes, and other manual controls are removed in favor of tablets and desks.

Automotive manufacturers and tech firms may attempt to make the transition from ownership to hailing more attractive through customization. When you enter the autonomous car, your Spotify playlist is synced to the car stereo or your YouTube video moves to the large tablet. In the morning, the car plays soothing tunes and dims the lights. If you’re a big NFL fan, perhaps Google will let you watch the livestream for free if you take a ride.

We may see different business models rise, including a rent model where you can keep a car in close permitter for 24 hours. That may be useful for weekend trips to the countryside, where the ride-hailing services are unavailable. As the systems become more fine-tuned, it may deploy a car to your doorstep in the morning before you even order it.

All of this is highly speculative, but one thing is for certain, a new warzone is opening in the transport industry and everyone is fortifying their positions.

Uber swallows self-driving truck startup Otto for $680 million

Ride-hailing giant Uber announced on Thursday that is has acquired Otto for approximately $680 million.

All of Otto’s team, which includes ex-leader of Google’s self-driving project, Anthony Levandowski, will move to Uber. They will work on the company’s self-driving project and report directly to CEO Travis Kalanick.

Otto’s research facilities in Palo Alto and San Francisco will continue to operate, and will share data with Uber’s Pittsburgh research center.

The acquisition price, at the time of writing, is calculated at $680 million by Bloomberg. That’s the value of slightly less than one percent equity in Uber, which Otto investors will receive. Uber will also provide 20 percent of the profits from its future trucking business, giving investors a long term reward for the acquisition.

Otto was not planning to build its own trucks, instead utilizing the current big rigs and installing a self-driving system inside. The startup has built its own sensors, including a LiDAR sensor, which is a useful radar tool for self-driving systems.

“Together with Uber, we will create the future of commercial transportation: first, self-driving trucks that provide drivers unprecedented levels of safety; and second, a platform that matches truck drivers with the right load wherever they are,” said Otto in a blog postconfirming the acquisition.

Uber wants control of entire transport industry

Uber has been investing heavily into new transportation sectors in the past year, including food and commercial delivery. Long haul trucking might seem like a huge step for the private firm—valued at more than $60 billion—but it is just another move to make Uber the de-facto brand for all types of transport.

The acquisition announcement came a few hours after Uber and Volvo announced a $300 million investment into self-driving. Volvo will provide 100 SUVs to the Pittsburgh research center, which will be deployed on the roads by the end of the month.

Columbus’ smart city win may lead to autonomous trucks

The Department of Transportation declared Columbus, Ohio the winner of the Smart Cities Challenge earlier this year. Now, city leaders plan to spend some of the $50 million reward on an autonomous “truck platoon” capable of driving in urban areas.

Columbus Region Logistics Council backed the project, which will test the autonomous trucks at Ohio State University before bringing them onto public roads, before moving to Alum Creek Drive.

It is one of a number of public-private partnerships that Columbus is embarking on as part of the Smart City challenge.

City leaders will work with the private sector to build a smartphone app connected to the trucks, which lets them commandeer the vehicle and provide the most efficient route. At the start, a driver will be stationed inside the truck, and the vehicles can only drive on certain roads.

Columbus sees multiple routes

From there, Columbus hopes to build fully driverless trucks that are able to drive on multiple routes without trouble. That could reduce the cost for the logistics industry, while also improving productivity, since self-driving systems don’t need to sleep.

It is one of the first public-private autonomous partnerships, in San Francisco and Michigan almost all self-driving tests are conducted by automotive or tech firms spending their own income.

Most of the talk on self-driving fails to mention the trucking industry, but manufacturers like Mercedes-Benz, its parent Daimler, and startup Otto are already building fully driverless big rigs that may hit the market before consumer vehicles.

Who are the startups upgrading the auto industry?

The auto industry has seen a flurry of startups and private investment enter the market in the past five years, as cars become more connected, electric, and autonomous.

Startups range from one man units to large teams, with some valuations exceeding $1 billion. But who are the startups? In a CB Insights report (infographic below), the venture capital database firm attempts to “unbundle” the automobile and show what these startups are working on.

Automation takes up the lion’s share of TV and news coverage, but as you can see in the infographic, there is plenty of other parts of the automobile that are seeing startup interest.

While most of the startups have received less than $50 million in funding, it doesn’t mean that they aren’t valuable. Cruise Automation, which sold to General Motors for $1 billion, only raised $15 million and its valuation pre-acquisition was $90 million.

Plenty of the startups are essentially trying to zone in on the auto issue, instead of building services that rival Android or Google Maps.

Take PathSense, a 10-person navigation startup based in Palo Alto, California. The team has released four SDKs, three for Android, one for iOS, which attempt to improve accuracy, speed, and lower battery drain when using GPS or geolocation tools on mobile.

PathSense, in a way, appears to be marketing itself to Google or Apple. It has tech and talent, two things the giants are in need of, especially for their own autonomous projects.

Auto aftermarket also an opportunity

But while everyone may be waiting for a fully autonomous car, the huge existing auto fleet presents an opportunity as well. Aftermarket autonomous features will be big as well.

“I think the broader perspective is that American’s can’t afford new cars and the automotive industry itself relies on the upsell of new features as an enticement for people to buy,” says Andy Karuza, CEO of Fensens, a wireless parking sensor and app. “Now, the new features are becoming more accessible and affordable through technology, allowing consumers to bypass having to get the new car all together. This will likely be a larger trend with IoT technology. ”

We have written a few articles on nuTonomy, a MIT spinoff that entered Singapore earlier this year. The startup, which is building an autonomous shuttle system, recently received approval from Singapore’s Land Transport Authority (LTA) to expand its autonomous trial in more zones.

nuTonomy’s goal is to provide its shuttle service to the entire city state of Singapore, possibly entering into other markets during that time. People will be able, in the future, to call for the shuttle in the same way we book Uber’s today—minus the driver.

As startups dive into these different sectors, it is possible they will find new methods that improve platforms and products outside of the automobile. Cybersecurity firms may create encryption that surpasses current end-to-end encryption on mobile messaging services, mapping and navigation firms have already proved their worth, as shown by the upgrades PathSense has made to Android and iOS navigation in its short lifespan.

Interconnected cars only a few years away, says Lear

Modular wireless connectivity may be coming to cars in the “a few years,” allowing cars to talk to other cars, connected roads, and parking lots.

Car component supplier Lear is looking to become the major player in this market, after acquiring Arada Systems and Autonet Mobile, two firms that developed wireless connectivity inside cars.

It has a plan to build a modular system, so OEMs can easily replace parts that don’t work or need an upgrade. The system will also receive over-the-air updates to update the wireless systems and provide additional security when necessary, similar to Tesla’s software updates.

Lear plans to test the modular system in Detroit, Michigan, which already has 125 miles of wireless infrastructure embedded into roads, thanks to Arada Systems. Similar infrastructure has been added to downtown Detroit, giving Lear a rather big patch of testing ground.

“Detroit is the only downtown in the country with a network deployment,” Singh said. “We’re currently looking to work with the city on creating connected buses, etc.”

Interconnected means leveraging everyone’s data

A connected car should be able to receive real-time updates on traffic, weather warnings, parking space, and alternative routes. In an autonomous world, the wireless capabilities may be extended to streaming video from providers like Netflix, Amazon Video.

Networking giants have warned that connected cars will bring a lot more devices onto the internet. Once autonomous cars hit the road, data usage in cars is expected to accelerate.

Lear sees a world where cars are able to understand what is happening in front and behind them and adjust accordingly. If it knows the traffic light is about to turn red, it may slow down the car to avoid accidents.

That could become a possibility in the near future, though it will take autonomous cars to change the way traffic moves and how cars interact with one another.

LeEco to drop $3 billion on self-driving car plant

LeEco announced last week a $3 billion industrial park that it plans to build in Huzhou City, Zhejiang to rival Tesla’s Gigafactory.

The complex, which will be built in two parts, will manufacture the LeSee electric car, car batteries and electric motors, and serve as an R&D center for self-driving and other emerging automotive tech.

The first phase of construction is set to begin late this year or early next year. It will cover an area of 4,300 acres and should be able to produce 200,000 cars annually. LeEco didn’t give a date when the second phase would start, but said it should reach 400,000 cars when finished.

Its an ambitious project, especially considering LeEco apparently doesn’t have a license to produce electric cars in China. The company has applied for a license, but so far has not received confirmation.

LeEco is undeterred, saying that the license isn’t a major deal.

It was looking for a partner to build the LeSee, possibly Beijing Auto or Guangzhou Auto, but decided to build its own industrial park instead. The factory could save LeEco money on production, though investors worry with the $2 billion purchase of Vizio, the Beijing-based firm is spreading itself too thin.

Where are all of LeEco’s investments?

Some also wonder where LeEco is getting the funds to pay for all of these huge investments.The Information and Bloomberg both reported some fishy borrowing and spending by CEO Jia Yueting, hinting at a lack of corporate oversight on leader decisions and finances.

LeEco has a large stake in Faraday Future, the autonomous car company that has shown up to CES 2015 and 2016 and is working with Aston Martin to build an electric car, so if it doesn’t get a license to build in China, it still has some connection to the automotive market.

People have questioned LeEco before for its extremely aggressive push into new markets. The Le 1 and Le Max both were underpriced and high performance smartphones, but both sold well and the company reported a small profit in the months following.

A car costs quite a bit more than a smartphone to manufacture however, and this will be a real test to see if LeEco can play by the Chinese regulators rules, keep its finances in check, and sell a fully functional, high performance electric car.

Connected cars need to play well with smart cities

As autonomous vehicles and smart city investments continue their blistering growth, experts say it’s vital that these two connected juggernauts work in better synchronicity.

An article by IT Online discusses recent findings by the International Data Corporation (IDC) its report “Collaboration Between Automotive OEMs and City Leaders for Implementing Connected Car and Smart City Solutions.”

In the report IDC looked at the interplay between these two massively transformational technologies which are generating huge levels of investment.

Global spending on autonomous cars will reach $29.6 billion by 2017, while governments around the world plan to spend $16.5 billion on intelligent transportation systems in the same timeframe.

IDC says that private-sector leaders of connected car technology must better collaborate with state and local governments to develop further advancements in urban environments.

Specifically, IDC says these two factions must work together on developing solutions for such issues as urban congestion, environmental impacts, street safety, better vehicle design and more value-added services for citizens.

“Connected cars have reached critical mass, and their interaction with the transportation infrastructure within Smart Cities is ongoing,” said IDC report authors Heather Ashton and Ruthbea Yesner Clarke.

“Automotive OEMs and smart city leaders will need to work closely to ensure the continued development of, and support for, connected car capabilities and services such as vehicle-to-vehicle and vehicle-to-infrastructure communications that will increasingly include autonomous operations.”

But are smart cities projects tackling real problems?

IDC’s recommendations come amid reports that predict that annual revenues from smart city projects will grow to nearly $89 billion by 2025. Despite this spending most smart city initiatives, include smart transportation projects, are focusing on solving peripheral issues, with few big projects tackling core city problems.

Meanwhile, connected car technology is witnessing a global race between technology giants like Tesla, Google and traditional auto manufacturers to develop the category killing robot vehicle. Yet these proponents of autonomous vehicles are focusing more on the technical self-sufficiency of their cars in urban environments, and less on how they integrate into the larger fabric of the reconfigured smart city of the future.

Britain to host Europe’s first track day for autonomous cars

A host of autonomous cars are set to converge on Bruntingthorpe, an airfield and proving ground located 40 miles east of Birmingham, in November.

It will be the first track day for autonomous cars on the continent, allowing manufacturers, software developers, and enthusiasts to come together and work on building the next generation of transport.

The event is backed by the government’s Innovate UK organization, which funds emerging technology projects in the country. The fund has backed another event at the Longcross Test Track, near Surrey.

“Driverless vehicle technology is a young discipline which pools expertise from different areas of mechanical, electrical and software engineering skills,” said Self-Driving Track Days co-founder, Alex Lawrence-Berkeley. “We’re keen to close the skills gaps between education and what industry is telling us is missing in the talent pool.”

Looking for startups focusing on autonomous cars

Innovate UK hopes that startups and universities will converge on the event, instead of it being all about large manufacturers like Volvo, Jaguar Land Rover, and Nissan testing their latest self-driving system.

RDM Group, one of the first firms Innovate UK backed, may bring its new pods to the event. It recently launched UK Autodrive, a £19 million ($24 million) project to integrate driverless pods into urban environments.

The British government is keen to grab as many automotive firms as it can away from other European countries, especially Germany, which does the lion’s share of automotive manufacturing. It should be noted that Audi, BMW, and Mercedes-Benz have not made plans to test vehicles in the U.K., focusing instead on Germany and the United States.

European countries are catching up with Britain’s burst into the scene. Germany announced public road testing earlier this year and France followed this week with a series of public initiatives. Spain and Italy have yet to launch similar projects.

Delphi joins crowded autonomous taxi run in Singapore

Joining self-driving startup nuTonomy’s Singaporean efforts, automotive supplier Delphi announced on Sunday that is has been awarded a contract by Singapore’s Land Transport Authority (LTA) to create an experimental pilot program for an autonomous taxi service.

The program provides three routes for people to choose, all located in a Queenstown subzone called one-North. Delphi will outfit six Audi SQ5 cars with the autonomous tech to drive people.

All cars will have a safety driver that can take over control of the car. Delphi expects by 2019 the safety driver will no longer be necessary, and by 2022 it wants the program to be fully operational.

It will also pick the people that drive in the autonomous vehicles to start, though the company does want the opportunity to drive everyday commuters in the near future.

Delphi believes the pilot program will provide the company with lots of data on the autonomous vehicle system, and hopefully improve the view people in Singapore have of self-driving cars.

Even though Singapore is the first, Delphi has reportedly in discussions with other cities in Europe and North America. It makes note of this in the announcement video (below). San Francisco and London are two possible locations, both have lower regulations than most cities for self-driving vehicles.

Delphi is not the first company to test autonomous vehicles in Singapore, in fact, it is a few months behind MIT spinoff nuTonomy. The startup arrived in Singapore in early 2016, in one-North where Delphi are starting to test cars, but recently signed an agreement with the LTA to expand its autonomous taxi pilot program.

Surprisingly, Google, Tesla, and Uber have not made large investments into Singapore. That’s despite the country’s rather relaxed regulations on self-driving and tech-focused government,

Delphi joins crowded autonomous taxi run in Singapore

Joining self-driving startup nuTonomy’s Singaporean efforts, automotive supplier Delphi announced on Sunday that is has been awarded a contract by Singapore’s Land Transport Authority (LTA) to create an experimental pilot program for an autonomous taxi service.

The program provides three routes for people to choose, all located in a Queenstown subzone called one-North. Delphi will outfit six Audi SQ5 cars with the autonomous tech to drive people.

All cars will have a safety driver that can take over control of the car. Delphi expects by 2019 the safety driver will no longer be necessary, and by 2022 it wants the program to be fully operational.

It will also pick the people that drive in the autonomous vehicles to start, though the company does want the opportunity to drive everyday commuters in the near future.

Delphi believes the pilot program will provide the company with lots of data on the autonomous vehicle system, and hopefully improve the view people in Singapore have of self-driving cars.

Even though Singapore is the first, Delphi has reportedly in discussions with other cities in Europe and North America. It makes note of this in the announcement video (below). San Francisco and London are two possible locations, both have lower regulations than most cities for self-driving vehicles.

Delphi is not the first company to test autonomous vehicles in Singapore, in fact, it is a few months behind MIT spinoff nuTonomy. The startup arrived in Singapore in early 2016, in one-North where Delphi are starting to test cars, but recently signed an agreement with the LTA to expand its autonomous taxi pilot program.

Surprisingly, Google, Tesla, and Uber have not made large investments into Singapore. That’s despite the country’s rather relaxed regulations on self-driving and tech-focused government.

GM hints at autonomous Bolt EV coming to Lyft

General Motors is confident it will have an autonomous, all electric car on the road sooner than most expect, available on Lyft’s ride-sharing app.

Speaking to Tech Insider, Pam Fletcher, the chief engineer of autonomous tech at GM, hinted that the tech is progressing faster than most expected and a consumer model could be coming soon.

“We have not made that announcement yet, but what I would say is this is all coming much faster than people anticipate, so I’ll say that much,” said Fletcher. “We are working on an on-demand ride-sharing network with Lyft, it’s not something we are thinking about, it’s something we are very much readying for consumer use.”

GM has already tested ridesharing apps for autonomous cars at its test facilities, but bringing that to public roads would require quite a hefty change in the legislation regarding autonomous cars.

Transport Secretary Anthony Foxx has hinted at federal regulations for autonomous cars in the near future, but we suspect driverless vehicles will remain off limits, at least in urban areas, after the Tesla Model S fatality has changed a lot of people’s opinions on self-driving.

Is GM self-driving’s dark horse?

It does show that GM could be the dark horse in the autonomous race, surpassing early favorites Google, Tesla, and Uber. In the past year, GM has invested $500 million in Lyft and$1 billion to purchase Cruise Automation, bulking up its autonomous prowess.

The automaker started testing its autonomous tech on public roads as well, bringing two customized Chevrolet Bolt EV cars to California earlier this year for testing.

Instead of selling the car, GM appears to be looking into a new driverless fleet that works inside the Lyft app. Uber, Lyft’s main rival in the U.S., is reportedly planning similar functionality for its self-driving fleet.

Google and Tesla may also be planning ridesharing or car-loaning services, instead of customers purchasing a car outright. That might not excite customers wanting to own their own autonomous car, but may provide means for millions to get around the city in a car for the first time, boosting mobility and productivity for all.