GM Plans to Make Systems for Autonomous Cars
October 17 2017 - 4:30PM
Dow Jones News
By Georgia Wells
LAGUNA BEACH, Calif. -- General Motors Co. plans to make the
bulk of the systems that go into an autonomous car, a shift from
its previous strategy that thrusts it into direct competition with
tech giants.
GM wants to have a hand in the creation of the software,
electrical architecture, sensors and large-scale manufacturing of
the next wave of vehicles, President Dan Ammann said Tuesday.
"The approach that we are taking to that is to control a lot of
that system ourselves because it allows us to move more quickly,"
Mr. Ammann said at The Wall Street Journal's WSJD.Live technology
conference here.
At first, GM seemed eager to team up. In early 2016, for
example, GM announced a $500 million investment in Lyft Inc., where
Mr. Ammann sits on the board of directors, and a partnership with
the ride-sharing company to develop self-driving vehicles.
But now the two companies appear more interested in going it
alone. In July, Lyft said it was creating its own autonomous-car
development division, and in August, GM said it had begun testing
its own ride-hailing app for self-driving cars. Initial tests of
the app are only for company employees, but GM plans for it to
eventually become a commercial product.
Silicon Valley firms including Alphabet Inc.'s Waymo and Tesla
Inc. are also developing their own systems. Waymo plans to put its
technology in others' cars and not make its own vehicles.
GM's relationship with Lyft is one example of mutual mistrust
between Detroit and Silicon Valley. Auto makers have feared being
turned into commodity producers making a shell for others to fill,
like cellphone handset makers. GM explored partnerships with Waymo,
but shifted gears after talks stalled.
In line with GM's new approach, the auto maker in 2016 acquired
Cruise Automation Inc., a Silicon Valley company developing
autonomous-vehicle technology, in a deal valued at more than $1
billion.
GM said on Tuesday it plans to begin testing its fleet of
self-driving cars in lower Manhattan, which Mr. Ammann called "the
most complex driving environment" in the U.S.
For Detroit auto makers, however, there's an added challenge: A
future of self-driving cars could also mean a future in which most
people no longer own vehicles. This new technology would require
the companies to change their business models, and educate
consumers around paying for distance traveled rather than for
vehicle ownership. Mr. Ammann predicts that car sharing doesn't
pose an imminent threat to auto ownership because it currently
accounts for a tiny portion of vehicle miles driven.
"We are inventing a lot as we go," Mr. Ammann said.
(END) Dow Jones Newswires
October 17, 2017 16:15 ET (20:15 GMT)
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