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Bob Lutz is a former vice chairman and head of product development at General Motors. And in this essay for Automotive News, he declares the end of the auto industry as we know it:
It saddens me to say it, but we are approaching the end of the automotive era. The auto industry is on an accelerating change curve. For hundreds of years, the horse was the prime mover of humans and for the past 120 years it has been the automobile. Now we are approaching the end of the line for the automobile because travel will be in standardized modules. The end state will be the fully autonomous module with no capability for the driver to exercise command. You will call for it, it will arrive at your location, you’ll get in, input your destination and go to the freeway. . . .
Most of these standardized modules will be purchased and owned by the Ubers and Lyfts and God knows what other companies that will enter the transportation business in the future. A minority of individuals may elect to have personalized modules sitting at home so they can leave their vacation stuff and the kids’ soccer gear in them. They’ll still want that convenience. The vehicles, however, will no longer be driven by humans because in 15 to 20 years — at the latest — human-driven vehicles will be legislated off the highways. The tipping point will come when 20 to 30 percent of vehicles are fully autonomous. Countries will look at the accident statistics and figure out that human drivers are causing 99.9 percent of the accidents. . . .
CNBC recently asked me to comment on a study showing that people don’t want to buy an autonomous car because they would be scared of it. They don’t trust traditional automakers, so the only autonomous car they’d buy would have to come from Apple or Google. Only then would they trust it. My reply was that we don’t need public acceptance of autonomous vehicles at first. All we need is acceptance by the big fleets: Uber, Lyft, FedEx, UPS, the U.S. Postal Service, utility companies, delivery services. Amazon will probably buy a slew of them. These fleet owners will account for several million vehicles a year. Every few months they will order 100,000 low-end modules, 100,000 medium and 100,000 high-end. The low-cost provider that delivers the specification will get the business.
Of course don’t forget the second half of the phrase “creative destruction”:
So auto retailing will be OK for the next 10, maybe 15 years as the auto companies make autonomous vehicles that still carry the manufacturer’s brand and are still on the highway. But dealerships are ultimately doomed. And I think Automotive News is doomed. Car and Driver is done; Road & Track is done. They are all facing a finite future. They’ll be replaced by a magazine called Battery and Module read by the big fleets. The era of the human-driven automobile, its repair facilities, its dealerships, the media surrounding it — all will be gone in 20 years.