US U-turns on Future

Melting the auto industry down

It has been brewing for some while that the vaunted US automobile industry has turned its back on its own future. There are three culprits involved in this volte-face: the industry itself; the Trump administration; and the fossil fuel industry. That is: stubbornness; obliviousness; and self-preservation, respectively, are the reigning virtues.

All this is covered in detail in The New York Times Magazine article by Matthew Shaer: “The American E.V. Has Been Crushed”. Shaer recounts how the Big Three automakers faced the threats and promises of the future of the industry, vigorously dashed into the opportunities, then followed the Trumpian example by chickening out. I urge you to read it.

Some personal connections

In or around 1970, when I was still working at The Aerospace Corporation, exploring applications of aerospace technology to the “real” world, I happened to come across a woman, a few months older than me, who was working on the possibilities of hybrid cars. Her focus was on battery-assisted designs for making internal-combution-engined (ICE) cars more efficient. Among her interests was the care and feeding of her, and her husband’s two Mercedes-Benz gull-winged 300SL sports cars; the gee-whiz cars of the era. She was very involved in making cars both more efficient — and faster. Her name was Roberta Nichols. Aside from her work as a mechanical engineer at Aerospace’s Laboratories Division she was working on her PhD at the University of Southern California (USC).

When I moved to USC in 1972 my office as Director of Interdisciplinary Program Development was in the School of Engineering. Shortly after I set up operations there I saw and congratulated a brand new PhD: Roberta Nichols who had duly impressed Mel Gerstein, the associate Dean of Engineering with her combustion expertise. Roberta then went on to become a guiding force in Ford’s hybrid vehicle program as Manager of Electric Vehicle External Strategy. So Ford was off to a good start, at least from the design and strategy point of view, in the 1970s.

So what happened?

While I was spending much of my time from the 1970s exploring ways to get cars off the roads, at least for work purposes, Roberta and many other engineers were trying to get cars off their gasoline habits by becoming hybrid- or all-electric. We all were trying to reduce the burning of fossil fuels in, and after, the 1970s even though we approached the issue differently. At the time I thought I had the quicker fix, given the presumed ease of persuading management to have their workers do it at a distance. After all, designing and manufacturing cars is far more complicated. Or so I thought.

It didn’t sink in to me at first that history has inertia. The broader and more complicated a history is, the harder its forward path is to steer. As an important example, Tesla developed outside of Detroit and the traditional auto industry. Elon Musk didn’t have to contend with, or be burdened by, the deep and broad history of the industry. He was free to innovate while Ford, General Motors, Stellantis and the rest were, and are still, bound by a century of gluey, quicksand-like history. As they start to leap forward, the glue draws them back. Chinese industry is far less bound by that glue; it is even encouraged to be innovative and is subsidized by the government while the US government is trying to eliminate the subsidies and increase the bonds.

The consequences are covered by Matthew Shaer. One by one, the US automakers have calculated that the future the world needs is too expensive for them without some form of subsidy. They feel that they need to concentrate on gas-guzzling SUVs and big trucks to survive. The innovators like Roberta Nichols seem to have disappeared, moved on. Elon Musk is still self-destructively around but he still is external to, not in, the auto industry and Tesla is losing value, thanks to some other Muskian traits. Yet Rivian is growing and may become profitable enough to flourish. Yet Rivian, too, is independent and outside the Big Three clan.

So the old guard appears to be dying; it has U-turned into a dead end. Long live the new?