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NYT
LOS ANGELES
For decades, the car business has been about style, performance, image and fuel efficiency. But suddenly, the industry is in a technological and sociological upheaval that may force automobiles ” and the companies that make them ” to change more in the next five years than they have in the last 50.
That was evident in this week's AutoMobility LA conference, a one-day event held by the organizers of the Los Angeles Auto Show that will continue over the next two weeks.
AutoMobility is an apt name, because much of the innovation seems to involve making the car ever more like a giant smartphone on wheels. But social mobility is a factor, too, as carmakers confront the surging popularity of ride-hailing services, which means fewer people see a need to own a car, while the push toward autonomous vehicles portends a time when many cars will not need people to drive them.
Uber, of course, and other ride-hailing services like Lyft, are potentially big disrupters of the automakers' conventional business model of selling cars to individual consumers.
And new variants are coming along, including See Jane Go, which had a booth at the conference. The company addresses a concern of many women by recruiting only female drivers and accepting only female passengers.
Mark F Fields, Ford Motor's chief executive, spoke here of the opportunities he saw in selling vehicles to the ride-hailing industry, including, eventually, ones that would drive themselves. But optimism requires the car industry to re-imagine itself.
Instead of the worldwide automobile industry thinking of itself as the $2.3 trillion business it is now, Fields said, it should see itself as part of the much bigger global transportation industry.
General Motors is hedging itself in ride-hailing, having taken a $500 million stake in Lyft. Under GM's separate Maven car-sharing service, which offers by-the-hour rental to consumers, the company is also renting cars to Uber drivers.
GM considers Maven a way to expose consumers to its various models, even if the people are not in the market to buy one. BMW has its own car-sharing venture, ReachNow, which operates in Seattle and Portland, Oregon, and will soon be in Brooklyn, New York. It allows members to drive a BMW or Mini vehicle for 41 cents a minute of operation.
ReachNow's chief executive, Steve Banfield, in an interview here, compared the concept to Netflix, the video service that has helped render ownership of DVDs superfluous. That might seem like a threat to BMW's business of selling cars, but Banfield described it as more of a get-acquainted marketing approach.
Some ReachNow members sign up simply for extended test drives of BMW cars like the electric i3, Banfield said. And younger members who cannot afford a vehicle early in their careers can become familiar with BMW's products, making them more likely to become buyers once their salaries catch up with their tastes, he said.
For people who do own cars but who would not mind some help paying for them, there are mobile-app services like Turo, which enable car owners to rent out their cars. By renting their vehicles for nine days each month, owners could probably cover their entire car payments and maybe even turn a profit, David Stewart, Turo's chief business officer, said in a presentation here.
Turo is good news for automakers, Stewart said, because it might help someone wary of owning a vehicle to afford to buy one, or to move up to a more luxurious model as the rental income made it affordable. But the question of who does or does not own a car now might one day seem a quaint distinction when cars start driving themselves.
And when that time comes, the companies with the biggest identity crises may be ones like Ferrari, Lamborghini and Porsche that have persuaded the public to spend big money on the thrill of taking the wheel.
Detlev von Platen, executive board member for sales and marketing at Porsche, views it as an evolution.
"Our cars will always be about the driving experience because that's what we sell ” experiences,'' von Platen said."But we must provide options for our owners and self-driving technologies that can be activated when desired must be considered."
And a self-driving Porsche might be more than a robotic tram. Imagine experiencing the throttle, braking and steering inputs of a professional driver on a racetrack. That could be programmed into the car, said Oliver Blume, Porsche's chief executive.
Porsche might also experiment with new types of sales or leasing options to cultivate loyalty. Von Platen said the company might consider a"flex lease," under which someone leasing a two-seat 718 Cayman would gain access to a Cayenne SUV for seven days a year, which could be handy for when five seats are needed.
The other big technology topic was electric vehicles, which all carmakers have been pursuing as a way to address concerns about the climate, as well as government-mandated rules and targets for lower emissions and higher fuel efficiency.
Jaguar announced its I-Pace all-electric SUV, a concept car the company said would be available in 2018.
And yet the election of Donald Trump, a climate-change skeptic who is widely expected to scale back automotive emission and fuel-efficiency regulations, could alter the industry's planning for environmentally friendlier cars. The possible relaxation of those regulations was an undercurrent here.
And the Alliance of Automobile Manufacturers, which represents a dozen of the biggest car and light-truck makers, recently wrote to the Trump transition team urging a reassessment of emissions rules that the group said posed a"substantial challenge" to the industry.
Blume of Porsche said his company would stay on its current technology track, even if fuel-economy and emissions standards were relaxed.
"When we think of new technology, we don't concern ourselves with political changes,'' Blume said."We think electrification is a technology of the future, and we have a responsibility to the environment.'' That debate simply reinforces a characteristic that was fully apparent at AutoMobility LA: The automotive business is not just about moving vehicles; it's about moving targets.
