Cruise, the self-driving car element of GM, made an announcement that could be seen as a healthy sign that the driverless car industry is embracing the tech race and now the trust race too. Photocredit: AP
When you are knee-deep in a particular industry it can be difficult at times to notice when an overall change or shift is taking place. The day-to-day ups and downs of the industry are likely always bubbling and bumping along, thus masking to some extent any larger overarching trend.
Subtle but telling signs can inadvertently be overlooked.
In the case of the self-driving driverless car industry, I’d say that a sizable shift is underway and we are moving into a new phase.
Let’s unpack my assertion.
Reading The Tea Leaves Closely
What sign or signal suggests that there is a mega phase shift occurring?
Last week’s announcement by General Motors’ Cruise unit that it’s postponing the public roadway rollout of their autonomous car ride-hailing service was a considerable signal, though few seem to have read the tea leaves fully.
You need to consider the whole context of the matter.
First, there’s the announcement itself, and secondly, there’s the marketplace and media reaction to the announcement.
Dan Ammann, CEO of Cruise, the GM-backed self-driving driverless car entity, indicated that though they are still going full steam ahead on the tech race for achieving true autonomous cars, they assessed the status of their own efforts, carefully, thoughtfully, and have opted to delay or postpone their earlier indication that by the end of 2019 they’d be underway with commercial ride-hailing of their self-driving cars.
You might find of interest Dan Ammann’s blog posting describing his assessment of their readiness and next steps (use the link here).
Within his explication, I appreciated that he mentioned something that I’ve been repeatedly attempting to emphasize about the self-driving car space, namely that it is a moonshot race that not only has to do with who can land on the moon first (achieve a true self-driving car), there is also the likewise vital aspect of doing so sufficiently safely enough that it garners trust among the public and all other stakeholders.
Per Ammann’s comments, this is both a tech race and a trust race.
Up until now, I’d assert that many of the self-driving tech participants have overstated the tech race and grossly understated the trust race.
Using the usual tech banner of “move fast and break things,” I’ve warned and admonished that you cannot get away with breaking things when it involves multi-ton cars on our public roadways that ultimately equate to life-and-death matters for us all.
There have been many that allowed themselves to be blinded by the “move fast” and therefore at times cut corners or rushed to put something onto the roadways that wasn’t ready, or that faltered in trying to include protective measures to potentially mitigate the risks of the nascent technology.
The Uber self-driving car incident in Arizona that killed a pedestrian has served as a wake-up call for those that have this kind of tech myopia (I had prior to the incident been predicting that we all were on the precipice of something untoward happening), as have other incidents prompted similar calls, for example newsworthy incidents involving deadly Tesla car crashes, though keep in mind that Tesla’s aren’t (as yet) actually true autonomous cars.
Using a limited kind of analogy, we just recently celebrated the Apollo 11 moon landing, and perhaps at the same time, it might be worthwhile to remember the Apollo 1 flashfire that sadly killed the crew in the cabin during a rehearsal for a launch mission. The matter caused a relook at the design and approach being used, some say it prompted a review that would have been unlikely to take place given the urgency of moving ahead in the space race.
Some might suggest that the Uber incident and other akin incidents have been a milder version of that kind of awakening.
Returning then to the Cruise announcement, I’d like you to notice something that was otherwise unnoticed.
Ask yourself this question: What happened as a result of the announcement?
Well, it was pretty much taken in stride by the marketplace and the media.
Headlines about the matter were relatively muted, mainly just pointing out that there was a delay in the projected launch date for the commercial ride-hailing service with their self-driving cars. Analysts were composed and offered commentary that was filled with aspects declaring that they weren’t necessarily surprised and that it was nothing to get riled about.
Furthermore, on the day of the announcement, the stock of GM closed at $40.88, ending on a slight 0.4% uptick.
Why The Reaction Was The Tell
By now you are probably wondering why I am seemingly pointing out the “obvious” aspects about the response to the GM Cruise announcement, all of which you perchance noticed in your daily news feeds.
Here’s why I bring it up.
The announcement did not result in the (usual) our “world is going to end” proclamations.
Remember how it used to be that any indication of even the slightest delay or postponement by a self-driving car maker was heralded as a disgrace for that firm?
You might as well have committed hari-kari if you were the top executive of an automaker or tech firm that even whispered that you were undertaking a delay in something related to your autonomous car efforts.
In fact, top leaders in the self-driving car space quickly learned that it was politically incorrect to use words like “delay” or “postpone,” any of which was an immediate red flag, no matter what it was that was being actually delayed or postponed.
The stock price of the offending firm would almost instantly take a painful hit when such announcements were made.
The viewpoint of the marketplace was that any firm that wasn’t striding at the utmost pace was going to lose this vaunted tech race. The littlest stumble or appearance of a stumble meant that your firm was falling behind, and such a faltering could not be tolerated, not one iota.
Some top execs lost their jobs because they didn’t appear to be taking self-driving cars seriously enough or they weren’t riding herd on their driverless car efforts with sufficient bluster and urgency.
I’m trying to bring your attention then to what didn’t happen upon GM Cruise making its announcement. It is easy to observe what did happen, while it takes some out-of-the-box thinking to consider what didn’t happen.
Here’s the skinny:
• What did happen is the stock price of GM stayed about the same and actually blipped up, while what did not happen is the stock suffering a beating due to the indicated delay in their self-driving car commercialization efforts.
• What did happen is that the media presented the matter as a relatively mild announcement, while what did not happen was a massive castigating of the firm for the open admission of a delay.
• What did happen was Ammann got mainly subtle approvals by the marketplace for being forthcoming, while what did not happen was a rebuke or name-calling as to his publicly making known the delay.
• What did happen was that analysts chimed in and said that this is an emerging and taken in-stride pattern and that we should expect more of it, while what did not happen was a sky-is-falling headline-grabbing series of proclamations that self-driving cars are never going to work and investors should flee at once from these efforts.
Conclusion
Overall, I attribute the willingness of GM Cruise to make their announcement as an indicator that they and Ammann anticipated that it was possible, actually feasible and fitting to be forthright and transparent, doing so without having to incur the usually expected drumming of severe armor-piercing slings and arrows.
Their willingness to make the announcement, coupled with the resulting calm response by the marketplace and the media, would have been unfathomable previously. In fact, if you take a look at recent announcements by various other automakers and tech firms in the self-driving car space, you’d notice similarly a by-and-large subtle but telling shift in tone and demeanor.
The self-driving car industry is in the midst of a phase shift, I suggest.
Gradually, the mania of the madcap tech race is giving way to a balance with the trust race. The mantra of “move fast and break things” is giving way to “move fast and do it right.”
Don’t though misinterpret my remarks to suggest the tech race is somehow lessened or put on a backburner. Heavens no. The tech race is still rocketing ahead.
What I am saying is that the trust race is now finally entering more formidably into the picture. Many that were willing previously to assume that if some eggs got broken it was okay and essentially part-and-parcel of trying to get to a truly autonomous car first, they are now realizing that maybe they’ll need to rethink that equation.
Of course, there are going to be some in the self-driving car space that might be desperate enough that they would over-emphasize the tech race and underplay the trust race. Not everyone in this arena is going to be balancing these factors in the same way.
Overall, when looked at across the board for the self-driving car industry as a whole, it seems to me that we have entered into a next phase consisting of two intertwined and inseparable factors, tech and trust.
As a warning for those that don’t see the intertwining or won’t embrace the intertwining, they are going to find themselves out-of-step and likely no longer have the prior over-the-top mania to serve as a cover for driverless cars efforts that wantonly subjugate the trust race to the tech race.
