Company / division: Carmakers
GM’s Cruise Automation unit has acquired Strobe, a startup which has been working on “chip-scale” LIDAR technology for use in self-driving cars. LIDAR is one of the big bottlenecks in autonomous tech development, both expensive and low-volume at present, with Velodyne currently the dominant supplier. As this Recode piece points out, GM is a bit more deeply invested in autonomous driving than most other legacy carmakers, having acquired Cruise itself as the “brain” of the system and also running various experiments of ride sharing and other services through Cruise and the GM Maven brand, and this acquisition extends that integration. My guess is that the technology was at a fairly early stage – the company seems to have just 11 employees – and it’s therefore unproven, though GM had an existing investment and may know something other potential acquirers didn’t, allowing it to swoop in at an opportune moment to take it off the market. Waymo and Uber, of course, are battling in court over the latter’s attempts to make its own in the image (or otherwise) of Waymo’s.
The Wall Street Journal, which this article acknowledges has had a somewhat adversarial relationship with Elon Musk and Tesla, reports that at least some Model 3 cars being produced in the company’s factory last month were still being assembled by hand rather than on the automated production line built for that purpose. That’s indicative of problems finalizing the automated line, which may be what Elon Musk’s comments about production bottlenecks referred to earlier this week in reporting low Model 3 production and deliveries. That, in turn, is indicative of the rush to get the Model 3 out the door at Tesla to meet overly ambitious targets. One of the reasons Musk has criticized the Journal is arguably that it’s one of the few publications that has regularly called out his failure to meet targets even as others fawn over Musk and Tesla’s notable achievements. Tesla refused to respond to the specific reporting in the article, and certainly didn’t deny its core assertions, suggesting that it’s likely accurate. I continue to be very skeptical that Tesla will get anywhere near its target production for the Model 3 anytime soon. Meanwhile, Elon Musk has been tweeting about various other things, including scheduling the Tesla Semi launch event for November 16th, and sending batteries to Puerto Rico.
Tesla today released its customary quarterly update on car production and deliveries, for Q3 2017. The overall number of cars produced was 26 thousand, just 5% up on last year’s total for the quarter, with just 220 Model 3 cars produced relative to the 1500 the company had projected. The company delivered to customers slightly fewer cars, including 260 Model 3s, indicating that it’s still a very long way from the mass production of these cheaper cars which it’s been forecasting. Tesla’s statement on the lower than expected Model 3 production is worth quoting in full: “Model 3 production was less than anticipated due to production bottlenecks. Although the vast majority of manufacturing subsystems at both our California car plant and our Nevada Gigafactory are able to operate at high rate, a handful have taken longer to activate than expected. It is important to emphasize that there are no fundamental issues with the Model 3 production or supply chain. We understand what needs to be fixed and we are confident of addressing the manufacturing bottleneck issues in the near-term.” All of this is classic Tesla – in effect: we fell short of our targets, unexpectedly, but we’ll still be able to meet our previously stated targets in the end. Past experience shows Tesla does generally recover from such setbacks, but not usually enough to deliver on original goals – something that’s been pointed out repeatedly by me and by others, but which still seems to engender remarkably little skepticism about its public pronouncements by many investors.
Ford and Lyft have announced a partnership under which Ford cars will begin running as part of Lyft’s network, first with human drivers and eventually with autonomous technology doing at least some of the driving. This is just the latest in a series of deals Lyft has done around autonomous driving, with previous ones including Drive.ai, nuTonomy, and Waymo, while it also works on its own autonomous technology effort. Ford, meanwhile, has been very clear about the fact that it sees ride sharing as the initial application for its autonomous driving efforts, but of course doesn’t have a ride sharing service of its own to test it with – partnering with Lyft is one way to accelerate that effort while also learning things that could be applied to its own effort if it chooses to go that way. Ford is the second car manufacturer to partner with Lyft overall, with GM an investor and early partner, though that partnership has definitely seemed looser recently. This is the key thing with pretty much all Lyft’s partnerships: they could all turn into something really interesting, but none of them commits the companies to do anything specific over the long term, which leaves Lyft vulnerable to being left at the altar by its various partners if they decide to go in a different direction.
CNBC reports that Tesla is using AMD “intellectual property” in its work on chips to power the autonomous driving systems in its cars. Though investors seem to have taken that as a sign that AMD is supplying Tesla with chips, the CNBC report doesn’t explicitly say that, but does quote the CEO of AMD foundry spinoff GlobalFoundries as saying it’s working directly with Tesla on chips, which may suggest AMD isn’t totally in the loop. The CNBC and other coverage has noted that former AMD chip engineers are now abundant at Tesla, though the company has used Nvidia rather than AMD chips in the past. It’s also interesting to see Tesla contemplating such an architectural shift when it’s claimed that the innards of cars it’s selling today based on its existing architecture are capable of running full autonomy in future. The idea of Tesla increasingly designing its own chips would certainly be in keeping with the work led by Autopilot head Jim Keller when he spearheaded the A-series chip initiative at Apple – companies truly serious about software need to design their own hardware right down to the chip layer, an idea reinforced by this week’s iPhone 8 chip performance benchmarks. But the news also makes clear how unsettled the chip vendor picture still is in the automotive space, with Intel clearly finally gaining some traction alongside others who have done better in the early running.
Tesla has just announced plans to add Superchargers (its rapid car chargers) in dense, urban locations in order to assist owners of its cars who live in cities and in many cases don’t have places to plug in their cars at home. Tesla’s own blog post does a good job of explaining the various charging options available today to owners both at home and away from home, but the post from Jalopnik linked below does a fantastic job of explaining the significance of the move. Essentially, if you’re an urban Tesla owner you have to explicitly go find somewhere to charge your car from time to time, which might well be inconvenient, especially because even the Superchargers take 45-50 minutes to charge the car. What Tesla is offering now is Superchargers sited in locations where those customers might already be spending time – e.g. at supermarkets, malls, or shopping or office areas within cities – so that their cars can charge while they’re busy doing other things. That potentially solves one of the biggest challenges for would-be urban owners of Tesla cars, and reinforces the challenge that still faces pretty much all of the other electric carmakers: the lack of widespread charging infrastructure. Though Tesla’s total scale in terms of car production remains tiny relative to the bigger manufacturers, the one area where it has a massive lead is in building out that infrastructure to enable charging while traveling and elsewhere, and adding Superchargers in cities will give it a further lead.
Toyota, Ericsson, Intel, NTT, and other companies have formed a consortium to figure out ways to manage the massive explosion of data that will be generated by cars over the coming years. As cars become more autonomous, they will need to gather enormously more data from cameras, radar, LIDAR, and other sensors and transmit at least a subset of that data over networks to central repositories for processing and analysis. That, in turn, is going to require some big decisions about which data to process locally, what needs to be sent over the air, and how much and which data to store on an ongoing basis in both locations. Since carmakers like Toyota don’t really have much experience with that kind of thing, network infrastructure vendor Ericsson and chip vendor Intel among others are going to work together with them to figure some of this stuff out, and have left the door open for others to join their effort in future. Notably absent from this initiative are other big automotive chip vendors like Nvidia, any cloud service companies beyond Japan’s NTT, or mapping companies like HERE, and given the strong roles they’re playing or likely to play in this area, the consortium does need to add additional members (including ones who compete with the founding members) if it’s to make real headway here.