Ford CTO Talks Autonomous Cars, Competing With Silicon Valley

At this point, Ford is basically a tech company.

The stalwart US auto manufacturer is testing out 3D-printed car parts, integrating Amazon's Alexa digital assistant into its cars, and investing heavily in infotainment systems and electric car technology. Ford is also going all-in on self-driving cars with a $1 billion investment in artificial intelligence (AI) startup Argo AI.

Raj Nair, CTO and Executive Vice President of Product Development at Ford, took the stage at TechCrunch Disrupt in New York City today and did his best Silicon Valley impression, calling Ford an automotive and "mobility company." Nair gave some insight into the Ford Motor Company's present and future focus, from a vehicle line spanning heavy-duty pickup trucks and sports cars like its 2016 Ford Mustang GT Premium to a growing number of hybrid and electric vehicles such as the 2017 Ford Fusion Hybrid.

Nair also broke down what he sees as the five tech elements required to "figuring out self-driving cars," possible partnerships with Silicon Valley tech companies, and why he thinks Ford will look like a much different company in 10 years as it gears up to ship driverless cars by 2021.

The 5 Factors to Solving Self-Driving Cars

"You can break it down into five categories: transportation-as-a-service, virtual driver systems, autonomous vehicle platforms, mass production, and fleet management," said Nair. "Transportation-as-a-service is at the top; that's the Ubers and Lyfts of the world who connect the customers to a transportation solution. Then we have what we call the autonomous vehicle platforms, which is all the base changes you have to make to the rest of the vehicle for it to function—safety and backup features, power steering, etc.

"We're investing in engineering on the virtual driver systems, and it's also a very high-scale industry," Nair explained. "Hundreds of thousands of vehicles and components that need to be manufactured, engineered, designed, and produced at scale. Then how do you manage this fleet of vehicles? A fleet that's not individually owned by Uber or Lyft drivers, but maintained and serviced by entities. Whoever gets the use cases right and all those elements down will be able to take advantage of autonomy as a business."

On Automation and Silicon Valley Competition

"The pace at which technology is advancing is faster that it's ever been. Because of autonomous driving, it's becoming more readily apparent to the broader public, the car industry, and to Silicon Valley, a lot more players are coming into it," said Nair.

"Autonomy is a form of automation, and now we're applying it to an area we didn't think we'd be able to automate, which is the actual driving. It's not too different from factory automation. It makes sense to deploy a really expensive robot in a business where you pay a lot for labor. Personal use for autonomous vehicles will come, but first it'll be introduced in businesses like taxis and trucking, where they're paying a lot for drivers."

On Ford's AI Acquisitions and Investments

Ford is not intent on solving all five aspect of the process itself and has turned to acquisitions and investments to fill in the gaps when necessary, Nair said.

"It depends on which areas of the autonomous and personal mobility solution we're focusing on," said Nair. "It could be an acquired entity like SAIPS, an Israeli software company we acquired. It could be an investment like our partnership with Velodyne LiDAR."

"Argo AI is an interesting hybrid model," Nair continued. "The most sought-after talent in this industry is the machine-learning experts working on virtual driver systems. We've got a very strong team internally, but to be honest they're being heavily recruited. With Argo, we saw an opportunity to provide stable funding for that startup—a billion over five years, consistent with what we thought we would be spending in that area—and move our autonomous driving engineers into Argo to help them understand exactly how the Ford Motor Company and our products work, and how the integrations need to happen."

On Possible Lyft or Waymo Partnerships

When asked about Waymo's new deal with Lyft and its recent progress in testing autonomous vehicles, Nair showed some healthy skepticism, but didn't rule out partnerships with Silicon Valley companies working on autonomous vehicle technology.

"We're are intent on making sure the partnerships we pick and choose fit into our overall strategy. We look at it tactically, rather than trying to make a headline," said Nair. "We talk to everybody. Waymo is strong on virtual driver systems. Lyft is strong on transportation-as-a-service, but you need all five elements for it to work."

The Auto Industry Reaches an Inflection Point

"We're seeing the advent of all these technologies, be it infotainment systems or connected vehicles becoming devices in the Internet of Things, or hybrid electric and certainly all the autonomous vehicle technology. There's also an increase in congestion in cities and in greenhouse gases, and all of this is culminating and hitting a peak at the same time," said Nair.

"I wouldn't say any of this is happening overnight, but the timing of autonomous vehicles, electrification, and reducing our greenhouse gas footprint are all coinciding. At the same time there's the timing of vehicles becoming primarily connected to the IoT and the ownership model changing to rely on ride-sharing, and all of that is culminating within the next 10 years or so. That calls for a rapid disruption in personal mobility, and that's our business. We're still the Ford Motor Company, but 10 years from now, I think we'll be both an automotive and a mobility company."

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