The war for the dashboard of the vehicle continues to play out.
As we’ve discussed here in the past, the automakers growing increasingly concerned about conceding the consumer interface inside the car to either Apple or Google. But the truth is, the vast majority of consumers want to plug in their phone, and mirror apps like Waze or Spotify while they’re driving.
Why are the OEMs worried about who owns the dashboard interface? They worry how disruptive Apple or Google might be to their plans to generate tens of billions of dollars in new, monthly, high-margin subscription services from drivers – for everything from increased horsepower to rear heated seats.
The latest news? GM announced plans to phase out Apple Carplay and Android Auto entirely, starting with their next generation of EVs. Instead, GM plans to build out the infotainment system themselves.
How is this going to play out for GM? That is to be determined. My gut is that GM is NOT going to be able to build a user interface anywhere near as pleasing as what Apple’s been able to accomplish.
Can you imagine a customer coming into a GM dealership and the poor salesperson having to explain to them that they can no longer sync their phone and mirror their apps? Good luck with that. In fact, I bet they lose even the most loyal of customers, if they decide to stick with this strategic direction.
Poor GM HAS been receiving a lot of blowback on this decision, and hopefully other automakers will learn from this and NOT follow suit.
Next up, two news items that I would characterize in the area of unintended consequences or downstream effects.
First, word out of the UK that the increased weight of EVs poses a risk that older parking garages could collapse under the strain.
EVs are typically quite a bit heavier than their internal combustion counterparts, due to the sheer weight of their batteries.
Many multi-story parking garages across the UK were built in the 1960s and 1970s when cars were far lighter than today. Since then, many of these garages have suffered from neglected maintenance, leaving them susceptible to structural issues.
The concern from experts is that new today’s heavier EVs could push these tired structures beyond their limits, and might increase the risk of structural overload and collapse, especially if most of the vehicles parking are heavy EV models.
Next up, continuing the theme around unintended consequences, is an experiment that is playing out in China – and back here in the U.S. we should be taking notes.
China has rolled out more public charging units than the rest of the world combined. The problem? The vast majority aren’t being used.
Since it’s home to by far the largest EV market, China is a test case for the transportation transition playing out globally. The nation installed more than 1.8 million public chargers as of last year. The rest of the world combined was at less than 1 million, with the vast majority of those in Europe.
But, public charging locations in China are used on average about once a day, with chargers along highway routes experiencing an average utilization rate of 1%.
This low usage illustrates the tricky reality of public charging networks: Reliable infrastructure is needed to help ease consumers’ anxiety about running out of battery range, but more EVs are needed to make the stations economically viable.
China’s predicament suggests that charging infrastructure investment back here in the U.S. to support higher electric-car adoption may take a long time to pay off. It’s going to be very important that we build these chargers in the right locations where consumers need them and will use them.
Next up this week, we got a bit more indication of just how much new EV initiatives might drag on legacy automakers’ profitability, as they make the transition from internal combustion to electric drivetrains.
We heard recently that Ford expects its electric vehicle business unit to lose $3 billion this year.
This week, RAM noted that the cost of electrification is so expensive, that they need to keep their internal combustion business healthy to help fund the transition.
If the legacy automakers are going to spend tens of billions of dollars to make the transition from ICE vehicles to EVs while at the same time investing heavily to wrestle away the software interface from Apple and Google, I think that some of the smaller OEMs just might not have the scale be able to accomplish both simultaneously. Trying to do both might break the backs of some of the smaller automakers, and force and a wave of consolidation of OEMs, who will benefit the scale efficiencies that will be needed to fund these two enormous transitions.
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