“It will be hard to sell a Car that isn’t self-driving,” Cruise President Kyle Vogt said today. The Chief Executive Officer, Chief Technology Officer, President & Co-Founder of Cruise neatly summed up his view at a Morgan Stanley Technology, Media & Telecom Conference. General Motors owns more than 60% of Cruise.
It’s a starting but ultimately compelling proposition. Moreover, General Motors already has a huge foray into EVs underway that analysts mired in numbers and thinking of the past have difficulty calculating.
Vogt knows much about autonomous vehicles. Since Cruise was founded in 2013, it has run more than 2 million autonomous miles in California. It has 300+ all-electric AVs on roads in San Francisco and Phoenix. Funding is more than $9 billion with ~1900 employees, with a market valuation of, gulp, +$30 billion.
The nascent autonomous vehicle industry is diverging along two development paths, Vogt said. The end game will be “either you drive it or it will drive you,” he predicts. Here, against current development practices where a driver monitors the vehicle and its software in operation, you don’t want two brains reacting differently during the often-chaotic urban driving environment, in essence fighting against one another for what is the best choice in the emerging scenario.
Moreover, Cruise’s autonomous vehicle development path is moving ahead to be EV dominated if not EV exclusive since EVs are the future. “For us the biggest challenges are to do all the work necessary to handle that there is no driver in the car,” he said. This presents some interesting scenarios, say, a police officer turns on the patrol car lights? How does the computerized AV interact with the officer?
There are also complicated hardware and software issues. If you have 16-core CPUs and high-performance artificial intelligence code computing more than 300 trillion operations per second for camera, radar and lidar processing, you can’t have the system freeze and wait for someone to recycle all the computers. I can see it now – the AutoInformed best computer coded automated vehicle of the year is…
Right now Vogt says Cruise has 5 of the 6 permits necessary in California (“other states are ephemeral”) to move into further development of an autonomous future. The missing, or rather not activated yet for ride hailing, is credit card authorization. Transportation in the US right now comprises 3 trillion miles a year at a cost of 60-80 cents per mile. We are on the verge of a huge paradigm shift. Yes there will be some situations where people might want to drive themselves, “but we do see a path to [selling or leasing] a million plus Avs in 2030,” Vogt said.
The challenges are the cost of the technology that works and customer satisfaction – make the riders happy. Cruise is 6 weeks into dozens of driverless vehicles on the roads. The technology is scalable from two cities, to three, to 20 to… exponential growth. Hence the capital market interests.
When asked who is leading the AV development race, Vogt said it is hard to know, but pointed to two models. For him the “proof point” is – and by implication will be – vehicles on the road. Some companies are writing software that they assume can be applied to future vehicles. Cruise is starting with a well-equipped vehicles now and working on making them function, optimizing them and getting the costs out. Ultimately both approaches could converge.
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