2016: A year of remarkable nothingness for the automobile industry, unless one counts all the over-hyped rumors of some fantastic future in store for motorists — so long as they no longer want to drive a car. Take an Internet cab ride or have a self-driving car come to your home, the future of the auto industry and its customers is just incredible to envision. Except, that is, for the part where self-driving cars destroy brand names for the automakers, inevitably laying waste to the industry as we know it. So much for the downside risk.
We’ve had 365 days of business reporting on this wonderful motoring future, during which no one has done the math to point out why it’s never going to happen that way. That fact should be a little disappointing for most.
As for Uber, the end of the year brought both numerous reasons for them to hope that self-driving cars become a reality sooner rather than later and one major speed bump to that outcome. Then, sad to say, on December 19th, Uber had a very bad day.
First, the Miami Herald reported that an Uber driver taking a fare to the Fort Lauderdale Airport was cut off in traffic by a van at 6:00 a.m. on Sunday morning. When the van driver exited his vehicle packing heat, so did the Uber driver, who then gunned down the threatening motorist. No charges were filed; Aventura police seem to see this as a case of Stand Your Ground. The night before that, when a fare tapped on his window to let him know the couple was about to enter his vehicle, Detroit Uber driver Matthew Allemon apparently became enraged; he later said they had disrespected his car. Allemon drove them for a mile and then demanded they leave his vehicle. When they asked to stay until a different Uber driver arrived to pick them up, Allemon jacked up the heat a notch, attacking the male passenger with a knife.
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No word on how these customers scored their Uber drivers in the app. But, for the record, passengers and drivers in Uber vehicles are not supposed to be armed.
Oh, and then Bloomberg reported that Uber lost around $800 million in the third quarter; and some business publications suggested that Uber’s losses for the year might fall between $2.5 and $3 billion. Now, that’s almost a trifecta of bad news, all date-stamped December 19th. But the fun wasn’t over.
Uber decided on its own to bring its self-driving car test to San Francisco, where little cable cars climb halfway to the stars. Only cable cars, like regular vehicles, typically follow local traffic ordinances, such as stopping at red lights. And on that first day two or three of Uber’s self-driving vehicles apparently weren’t quite ready for prime time; video caught them running a stop light and nearly crashing into another car. Oops. Uber executives admitted as much, but said those particular vehicles were not part of the test and they had suspended the humans who were supposed to be in control of them.
Did I really just write that? "A self-driving car ran red lights and the human was the one benched for it."
Oh, and on the 19th Uber admitted that its self-driving cars have another problem: awareness of bike lanes. Safety advocates thought that might be a serious problem for bicyclists; now it’s a stated fact.
The California Department of Motor Vehicles demanded that Uber cease and desist all testing of these experimental self-driving cars on public roads until it files for and receives the required $150 special permit. Uber proceeded to tell California and its bureaucrats to go pound sand; in the adult version of a 3rd-grade temper tantrum — where you screamed, "Johnny’s parents let him do it," thinking will make your parents let you do whatever it is Johnny’s doing — Uber said that if Tesla can test its vehicles on the highway without these permits, Uber will, too. One can almost visualize red-faced, shouting Uber execs, fists at their sides and feet stamping in unison.
California’s DMV promptly voided those 16 test vehicles’ registrations. Problem solved.
Has automotive hype ever proved true? Visit www.star-telegram.com/cars/ed-wallace and find out.
Again, it’s time to put a reality cap on any discussion of self-driving cars. A fully autonomous car may never happen. Not for lack of improving automotive technology, but because roads must be in exceptional condition for such cars to find their bearings and deliver a safe ride. And we are not willing to invest enough in our infrastructure to make that a reality. Uber has already admitted that its self-driving vehicles have a problem detecting bicycle lanes, and most of those are recent and well marked. How in the world would a self-driving car make it from Alliance into Fort Worth with all the work being done on I-35W? How could it drive into downtown Dallas? For the past year there, every few weeks a lane that used to deliver you to the downtown exit simply disappears; then it’s moved over two lanes, then two lanes back — and now is being moved yet again.
And there’s an even more problematical issue, which we’ve brought up before in this column: Technology moves on, and these systems require vehicle-to-vehicle and connected communications to work. But consider: When General Motors launched its OnStar service, created in conjunction with EDS and Hughes Electronics in GM’s 1997 models, it was based on an analog cellular system. And that was wonderful for nine years — until the last analog cell towers were turned off, and all those OnStar units simply went dead.
Believe it or not, 2G communication cellular networks predated OnStar’s arrival and are still operational, and have worked since cell networks started going digital a generation ago. Automakers like BMW built their vehicles’ telematics systems using that exact wireless standard. And so far, so good; at least, for the next few days, until AT&T shuts down its 2G networks. Then the Bavarian version of GM’s OnStar will simply not work — much like if, 30 years ago, you tried playing your first compact disc on your old Sears Silvertone record player.
In case you weren’t counting, that’s two major telecommunications standards that have obsolesced and ceased to exist in just eight years. Moreover, that will keep happening: The self-driving car you buy in a decade may well cease to work at all a mere eight to 10 years later, as digital communications, computer chips’ speeds and operating systems advance and change.
Remember the Hydrogen Hype?
The second part of this "good riddance to 2016" tour concerns our past. For this we need to walk back to the turn of this century and the excitement surrounding a future where truly exceptional gasoline mileage was already being delivered and the future of vehicles that didn’t use gasoline at all was at hand. See, you’ve already forgotten; just as the year 2000 rolled around, here came the first hybrid electric cars from Japanese automakers, which promised fuel efficiency well into the 50mpg range and more. It was an astonishing feat of automotive engineering, primarily by Toyota. So astonishing that my boss at Car & Driver refused to publish the fact that the Toyota Prius was coming to market, because his engineers on staff said it was impossible.
Not having anything of their own to compare to this Japanese breakthrough, almost immediately Detroit’s automakers promised us a hydrogen future. GM even went so far as to create a hydrogen fuel cell in a chassis. It claimed customers would buy it, keep it for decades and from time to time buy and place on it a new body — which GM would gladly design and furnish for a price.
In fact, the business media buzz about hydrogen fuel-celled vehicles’ impact on our motoring future was almost as relentless as the buzz on self-driving cars is today. But that technology had as many potential problems as self-driving cars do. First, it takes a great deal of energy to pull hydrogen molecules away from whatever they are attached to. Hydrogen may be the most abundant thing in the universe, but it still has to be split from other molecules. Second, remember the Hindenberg disaster, and you get a real sense of how dangerous transporting that fuel to market is. Third, think of the sheer cost of building hydrogen refueling stations nationwide. We have had natural gas refueling stations across the Metroplex for decades, but not enough to make it convenient for anyone to have purchased one of those vehicles.
At one point, Honda even said that it would bring its first hydrogen fuel-celled vehicle to market as soon as it could get the cost down under $100,000. That’s not a misprint. But buy a Honda Civic LX for $20,000 and, even if gasoline goes to $10 – 20 a gallon, it’s still cheaper to own and operate than a hydrogen fuel-celled vehicle would be.
Still, for years hydrogen stayed the hype flavor of the month for the auto industry: The coming day of our real freedom from foreign oil, when we move our automotive fleet over to using hydrogen fuel. But once the hype had worn us all out, suddenly no one was talking about hydrogen fuel-celled cars anymore. Well, barely talking about it. Case in point: Toyota has brought its (fuel-celled) Mirai to market and so has Hyundai, and now Honda is delivering its Clarity fuel-celled vehicles to select dealers in Southern California. What the automotive media loudly proclaimed the greatest thing since sliced bread just 15 years ago is today the biggest automotive yawn in history.
We can compare this hype about the future of the automotive industry to going to the moon. Yeah, it was exciting when JFK announced the goal, and it got increasingly exciting as we went from the Gemini missions to Apollo and so on. And in the summer of 1969, when we actually got there, the whole world watched it in real time. By about the third time we did it, ABC wouldn’t preempt Barnabas Collins in the Goth soap opera Dark Shadows for it.
Recently GM CEO Mary Barra was quoted as saying that the auto industry would change more in the next five years than it has in the past 50 years. It wasn’t a new thought; that or something very close to it has been predicted for as long as I’ve been around the industry. It hasn’t been true yet. Maybe next time.
© 2016 Ed Wallace
Ed Wallace, a member of the American Historical Association, is a recipient of the Gerald R. Loeb Award for business journalism, conferred by the Anderson School of Business at UCLA. He reviews new cars every Friday morning at 7:15 on Fox Four’s Good Day and hosts the top-rated talk show, Wheels, 8:00 to 1:00 Saturdays on 570 KLIF AM. E-mail: email@example.com