GM warns the Valley: Prepare to compete over driverless cars – U.S. News & World Report
By TOM KRISHER, AP Auto Writer
MILFORD TOWNSHIP, Mich. (AP) — Move that tiny self-driving pod out of the way.
That might as well have been the message Thursday from General Motors to Google, Apple and anyone else with designs on dominating the market for autonomous cars.
The 107-year-old automaker told Wall Street analysts Thursday that it intends to lead no matter what form of transportation people pick in the future.
GM already has millions of cars on the road that are connected to the Internet, and it has young engineers who are helping to develop new technology that will lead to autonomous driving, said Mark Reuss, GM’s product development chief.
“No one has solved all the technical challenges or claimed outright leadership,” he said. “We see this as a tremendous opportunity to lead.”
Google has been testing bulbous electric self-driving pods in and around its headquarters in Mountain View, California, denying that it wants to get into the car-building business. Apple has reportedly been testing its own vehicles, too, as have auto parts makers and German and Japanese automakers. High-tech taxi service Uber has a lab in Pittsburgh that’s also working on the technology. Google has a fleet of 48 robot cars that have logged more than 2 million miles on private tracks, highways and city streets.
But GM tried to even the score a bit Thursday, announcing that it would run a fleet of self-driving plug-in gas-electric hybrid Chevrolet Volts on its giant technical center campus in the Detroit suburb of Warren, Michigan, by late next year. The campus is undergoing a $1 billion renovation, and GM will learn from the app-summoned cars as they transport employees amid the massive construction project, Reuss said.
Reuss said the company and partners are working to develop better sensor technology that can handle heavy fog or ice patches, as well as artificial intelligence that can predict driver behavior and prepare for real-world problems. The company also is researching precision mapping to guide the cars.
GM said $5.5 billion in manufacturing, purchasing, information technology and administrative cost savings will help to pay for the investment needed for the new technology, even as the company increases its earnings.
“We have already developed a lot of this enabling technology because we saw this coming,” Reuss told the analysts.
In addition, the company revealed a car-sharing program that allows residents of a 479-home luxury apartment building in New York City to reserve SUVs and park them in any of 200 garages in Manhattan. It also plans to launch a car-sharing service in an unidentified U.S. city early next year.
“Some might find this massive change to be daunting, but we look at it and see the opportunity to be a disruptor,” CEO Mary Barra said.
GM President Dan Ammann told analysts that the personal car ownership model will remain in place for “quite some time.” But GM is experimenting with autonomous cars “so we’re right there every step of the way,” once that model changes.
GM also announced that it would be the first in the auto industry next year when it reveals technology to weld aluminum to steel, helping to reduce weight in vehicles.
The company also predicted a 31 percent reduction in battery cell costs for electric cars that could speed price reductions. Currently its cost per kilowatt hour is $145, but that will drop to $100 by 2018, a reduction that could make the cars more competitive with internal combustion engines.
GM now sells the Volt, which can go about 40 miles on battery power before a gasoline generator kicks in. It also has promised to roll out the Chevrolet Bolt, a $40,000 fully electric car with a 200-mile range, in late 2016.
The company also said during its annual investor presentation that global growth initiatives will increase earnings per share to $5 to $5.50 next year. GM projects full-year earnings this year of $4.50 per share this year, up from $4.12 in 2014.