NAIAS 2017: Game On As Silicon Valley Battles Detroit Over Self-Driving Future

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NAIAS AutoMobili-D

If it wasn’t explicit before, it is now: The battle between Silicon Valley and the auto industry for control of the very future of the car is on.

More than ever before, CES in Las Vegas became a platform for automakers, suppliers and technology companies to tout their wares and approaches to car connectivity in general and, specifically, to getting the world to the starting line for self-driving cars. Auto company executives made relevant news and participated in the discussion at CES more than ever before, joining their tech industry counterparts who had been hanging out there since the beginning.

But the far more dramatic development was how the Detroit Auto Show made its own play for the mobility platform with AutoMobili-D, an adjunct to the 2017 North American International Auto Show that was staged in an integrated way with the traditional show at Detroit’s Cobo Center.

News and buzz at AutoMobili-D made it fully apparent that while auto companies and tech companies have done some early cooperation to move into the possibilities for self-driving—and that cooperation in many ways will continue—their future interactions will be dominated by a pitched battle over the products, services and direction that will comprise the autonomous driving era.

So John Krafcik, CEO of Waymo, the Google sibling that is developing a self-driving car platform, came to NAIAS to do the official unveiling of the Chrysler Pacifica Hybrid as outfitted with Waymo’s self-driving hardware and software. But in doing so, he threw down the gauntlet by reminding attendees that his Silicon Valley-based company will be putting some of its test fleet of 100 self-driving Pacificas onto the roads of some Western states within the next few weeks.

But Michigan-based business want to see that kind of activity going on in Detroit and Flyover Country, directed by native automakers, not by auto industry interlopers from the West.

“Detroit is the perfect storm” for developing a critical mass for the mobility services business, said Ted Serbinski, founder and managing director of Techstars, a mobility startup accelerator established in Detroit with the help of Ford. Detroit is an iconic city that emerged from a recent bankruptcy, “with a location by Canada, great airports, great universities, and a cost of living here that is still reasonable versus San Francisco or New York.”

Serbinski added: “It’s not us versus Silicon Valley; we have the ingredients to be our own Detroit.”

Marc Weiser, managing director of RPM Ventures, a VC firm, who splits his time between Detroit and San Francisco, emphasized the importance of capital and asserted that its availability in Detroit isn’t a problem in an overall sense.

“Ford makes more F-150s in a month than [California-based] Tesla makes [cars] in a year,” he said. “And the amount of money invested in getting access to the customer by the players here is the key to the kingdom. “If you start a company in Silicon Valley or Portland you’re going to hire people here because you can’t get to the end customer unless you go through here.”

Chris Thomas, head of Detroit-based VC firm Fontinalis, would like to see Detroit-based automakers finding opportunities to make digital investments in local companies instead of having to invest in Silicon Valley companies—such as General Motors’ acquisition of Cruise Automation—to acquire the capabilities they need to succeed in the coming era or autonomous driving and mobility services.

“I want the next opportunity in that space to be from Michigan,” he said.

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