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Friday
Jul282017

Autonomy’s Dirty Little Secret

By Christopher A. Sawyer

The idea of a world in which autonomous vehicles replace those piloted by humans scares some, excites others, and sends into paroxysms of joy those who wish to see an end to personal freedom. However, if we take things at face value, automakers are pursing this technology for a few reasons: 1) It is a viable avenue of development that will increase vehicle safety and convenience, 2) Autonomy’s promise of greater efficiency and safety will reduce the level of scrutiny automakers endure from government and non-government bureaucrats, and — most importantly — 3) It elevates car companies from Rust Belt white goods providers to tech companies more on par with those in Silicon Valley. A good bit of this last point is down to insecurity, though auto companies feel they have to revamp the industry’s smokestack image in order to attract the best and brightest. Plus, shareholder value — an incredibly lopsided but easy-to-quantify measure of a company’s overall health — demands it. Look no further than Tesla’s stratospheric per share price for the boardroom angst over stock prices and shareholder value.

However, a lunchtime conversation with a friend and former colleague reminded me of another reason for the push toward autonomy. Somewhere between the fish and the chips he mentioned that a presenter at a recent UMTRI (University of Michigan Transportation Research Institute) event strongly intimated that automakers would use the shift toward autonomous vehicles to absorb some of the costs associated with tightening fuel economy and emission regulations. It mirrored an off-the-record comment from an executive at one of the supplier companies developing autonomous technology made to me two years ago. It wasn’t until later, however, that the gray stuff in my cranium dug up another conversation — one that that took place nearly a decade ago — with a high-level engineer at an internationally renowned powertrain development company that helps to put his all in context.

As the point person on a joint industry/government study of the proposed 54.4 mpg CAFE standard, she was responsible for identifying technologies that would meet this goal that were neither cost-prohibitive, nor beyond the industry’s ability to provide cost-effective and reliable solutions. During our discussion, she commented on how regulators and non-government watchdogs would complain that vehicles like the Corvette ZR-1 were signs of the automaker’s “speed lust” and unwillingness to seriously pursue tighter emission standards, without understanding that each performance derivative offered a golden opportunity to improve powertrain efficiency. “Power is performance is efficiency,” she said. “Holding all else equal, the more efficient you make an engine, the more power it will produce while using less energy. And vehicles like the this [the ZR-1] are low-volume testbeds for new technology that have statistically zero effect on resource use or emissions.”

You may have noticed my focus on emission standards in the previous paragraph. Its use was not accidental. As she related, the fuel economy standards are emission standards in disguise; they are limits on vehicular CO2 production. Setting the fleet fuel economy standard at 54.5 mpg gave a fleet CO2 level acceptable to automakers, the EPA, and the California Air Resources Board. And this is where we circle back to autonomy.

“Automakers have to find a way to either convince new car buyers that the few thousand dollar increase in the transaction price between now and when the standards are fully implemented is worth the price, or a way to hide that cost in a new technology customers are willing to pay for.” If this failed, there were only two options: 1) Tax gas and diesel such that the price never goes below an inflation-adjusted equivalent of $3.50 per gallon, or 2) So demonize internal combustion engines that the public would demand a wholesale shift to electric (not electrified) vehicles. Both ideas have their downsides. The first option would require a level of political will and tone deafness that would guarantee electoral defeat, while the second would not only obsolete current powertrain plant and equipment, it would require an R&D effort many times “moon shot” levels with no guarantee of success. Though the car companies supported the inflation-adjusted gas tax, today’s obsession with autonomy has given them cover for decisions made by unelected (and cowardly) bureaucrats.

Many media outlets and car companies claim Millennials are clamoring for autonomous vehicles and, by extension, electric vehicles. I guess, like with all polling, the answer you get depends on the question you ask. Just last summer my next door neighbor’s daughter had her wedding reception in mom and dad’s backyard. Her husband, as it turns out, works for one of the suppliers providing autonomous technology to automakers. Which gave me a chance to ask him and a number of his co-workers about the supposed Millennial obsession with autonomous cars. “Not only do I not want a car that drives itself everywhere,” said one, “I don’t know of anyone who sees that as a good thing.” To which another added: “It’s going to take maybe 30 years before we reach a tipping point where the number of vehicles with autonomous capability make it possible to turn the driving completely over to the vehicle. And that will require not only vehicle-to-vehicle but vehicle-to-infrastructure communication on an instantaneous basis.” At this point the conversation moved to graphs on napkins, an extrapolation of the number of lines of code necessary to make this work (it’s beyond enormous), and the likelihood of governments footing the bill for the infrastructure portion of the equation at at time of more pressing infrastructure needs.

Seeing an opportunity, I asked why Apple and Alphabet and others would be stepping into autonomy so deeply when its realization was still far into the future. “That’s easy,” said the quietest of the group. “Data.” Every time the vehicle is used, data is created. Things like trip length, location, time of day, speed, climatic conditions, passenger load, destination and much, much more. This data has value. It can be sold to businesses your vehicle passes along its route, collated by municipalities for taxation, monitored by insurance companies to set your auto and health insurance rates, etc. “It doesn’t take much,” he continued, “to imagine this data being used in a Minority Report-like pre-crime fashion, to construct algorithms that force ride sharing based on destination, time and miles traveled, and that encourage its use in everything from divorce proceedings to monitoring terrorist activity.” These concerns, however, are being swept aside in pursuit of the cubic dollars this information represents.

The question that remains is: Who owns the data? Automakers? Suppliers? Vehicle owners? Vehicle owners might assume that, because it is their car and they have a right to privacy, they own the data. However, as one of the group pointed out, “In the information age, the very concept of privacy is under attack. The amount of data currently gathered from various sources is enormous, and this promises to increase this exponentially.” Automakers, on the other hand, feel that, because they supply the vehicle, they have control over the data and its disposition, while the current supplier base expects to share in this bonanza. Software providers, on the other hand, believe the collected data is theirs to have and to hold —  and to sell. “The heavy hitters from Silicon Valley,” said one of the group, “are the ones you have to watch. Their game plan seems to be the creation of an integrated vehicle-wide computing architecture so pervasive the OEMs won’t have any choice but to deal with them.” Added another, “I wouldn’t be surprised if we saw something like what happened with the introduction of iTunes. You now have Pandora and Spotify and others in the same space, but the result is pretty much the same. The power has shifted from the music producers to the music providers. The OEMs will be fighting over [profitable] scraps.” And — if the consumer doesn’t pay close attention — they may lose much more than their ability to drive their own car where and when they want.

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