Only a year ago many people were convinced that tech companies like Apple, Google, and Tesla — together with Chinese-backed upstarts like Faraday Future — were poised to decimate the business of traditional car manufacturers.Apple CEO Tim Cook had green-lighted a secret project inside Apple to develop its own car, with rumors the first iCar would roll off production lines as early as 2019. Google had just completed its first ride in a driverless car. Faraday Future, backed by Chinese billionaire Jia Yueting, was about to unveil the future of mobility.Just over 12 months later, the hype has disappeared. Apple has scaled back its car ambitions. Google has spun out its autonomous car project and says it won’t be building its own car. Faraday Future is in deep financial trouble, facing multiple lawsuits and seeing key personnel depart, according to a BuzzFeed report.Even Tesla, the prime example of a tech company disrupting the car industry, has struggled to get cars off the production line, with the new Model X listed among Consumer Reports’ top 10 least reliable cars on the road.“The complexity of the supply chain, as well as the need for durability and safety, make building a car one of the most difficult things in the world to do,” Michael Ramsey, research director at Gartner, told VICE News.While tech companies are struggling, traditional car manufacturers are making smart investments, led by an icon of old Detroit: General Motors. This week it announced it would produce its next-generation driverless cars at its Orion Township assembly plant in Michigan — where lawmakers just introduced a series of bills permitting driverless-vehicle tests on public roads.Earlier this year GM spent over $1 billion to buy San Francisco-based autonomous driving startup Cruise Automation, with the company planning to roll out some of that tech in its 2017 fleet of cars.But GM isn’t just betting on driverless cars, it’s also actively looking at how car ownership and mobility will change in the future. In January, the company invested $500 million in ride-sharing company Lyft, and has said its first batch of driverless cars would become part of the Lyft fleet. It has also launched its own ride-sharing service, called Maven.In this space it will compete with Uber, which this week rolled out its driverless car technology — in partnership with carmaker Volvo — in San Francisco. However, it was immediately ordered to stop testing by the California regulators as it didn’t have the right license.While Apple and Google were assessing their ability to build a car, the companies that have been building cars for decades began to make their own investments in technology.“Car companies have way more leverage than I think the technology companies thought – and maybe even [more than] the car companies thought,” Ramsey said. That leverage includes years of experience in the supply chain, production, safety requirements, and the sales channel.In 2016 we have seen dozens of major car manufacturers announce their own autonomous driving efforts, including tests, acquisitions, and partnerships.
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- Ford continues to test its driverless cars in all types of conditions, after announcing in August that it plans to have fully autonomous vehicles ready for ride-sharing in 2021.
- BMW has partnered with Intel and Israeli autonomous driving specialists MobileEye to create open standards for self-driving cars, with a view to having them on the road by 2021.