Tech Shares the Driving With Detroit

California is California and Michigan is Michigan, but ever the twain shall meet.

Technology companies love to talk about “disrupting” existing industries -- disruption being a less rude way of saying, “We want to put you out of business.” But if self-driving cars become a fixture on the roads in coming years, it may be because of unlikely collaborations between tech youngsters and the corporate progeny of Henry Ford. 

General Motors and Lyft said on Monday that they would work together to create fleets of self-driving cars that can be hailed like Lyft taxis. The idea is a long way from becoming reality, but the GM-Lyft project is the latest example of collaboration between Big Tech and Big Auto to steer the future of cars with computers at the wheel.

Google, which has sometimes been scornful of Detroit, is reportedly creating a joint venture with Ford to build autonomous cars. Fiat Chrysler CEO Sergio Marchionne has said he wants to collaborate with tech companies like Google and Apple on self-driving vehicle technology, and Google co-founder Sergey Brin has expressed similar sentiments about cooperation with automakers. 

Drive for the Future

Car companies and technology firms are vying to control the development path for self-driving cars. If it comes down to financial resources, Big Tech has a huge leg up on Detroit.

Source: Bloomberg

The growing alliances between automakers and tech companies are a fascinating experiment in collaboration between ruler and invader, akin to Apple and Polaroid working in tandem on the iPhone camera. The collaborations are a sign of how the technology industry and carmakers are recognizing each side has useful expertise to speed up the realization of self-driving cars. Google might be brilliant in software, but Ford knows how to manufacture, market and sell cars and navigate the complex networks of suppliers for auto parts. 

Assuming the industries' collaboration doesn't amount to empty promises, this may also signal a period of tamped down arrogance in Silicon Valley about tech companies' abilities to build the future on their own. This attitude shift is essential at a time when Silicon Valley's biggest opportunities for world-changing (and money-making) technologies are in sectors -- such as health care, financial services, education and transportation -- that present not only technological problems but economic, cultural and political ones. It won't be easy for Silicon Valley to simply bulldoze its way through.

Keep in mind even optimistic backers of autonomous vehicles don't expect them to become available for several years or more. Mainstream self-driving cars are even further off. The transportation research firm Victoria Transport Policy Institute has projected fully autonomous vehicles will be on sale around 2020, and it will take to the 2040s for them to comprise 40 to 60 percent of vehicle sales.

Despite the automaker and tech alliances, there are fundamental areas of autonomous car technology where the two sides are at loggerheads. Some of the car companies, including GM, envision a future where software serves as a co-pilot for people in their privately owned cars. Tech firms like Google and Uber have talked about a world where far fewer people own cars. The tech companies instead tend to fixate on visions of fleets of shared cars that can be summoned like an Uber -- except without a human driver -- to drop users off and move onto the next ride.

It is tough to reconcile those two visions of the self-driving future, but Lyft's co-founder, John Zimmer, says there is more common ground than it seems. Zimmer told BuzzFeed News that he and GM President Dan Ammann "both believe that autonomous vehicles will be introduced through a service like Lyft rather than through individuals owning autonomous vehicles." It's unclear if that is a change in position for GM, whose executives have said previously that they envision playing a hand in both privately owned self-driving cars and in taxi-like fleets without human chauffeurs.

There will, of course, always be companies in each industry that want to develop self-driving auto technology without pesky partners to slow them down. Tesla on its own has already developed an autopilot feature in one of its expensive cars, and it has teased Wall Street with vague words about taking part in the vision of autonomous taxi fleets. Uber and Mercedes are also working on their own technologies for semi- or fully autonomous cars. Elon Musk's Tesla is already an example of the do-it-yourself approach yielding huge dividends. Musk has created remarkable cars -- though perhaps a company that might not last -- by scorning Detroit and ignoring standard operating procedure for how to build vehicles. 

Self-driving cars, however, are a trickier problem that requires messy democracy among industries rather than the nimble actions of rogue players. Many advocates in multiple fields are required to develop self-driving car technology, create business models and satisfy regulators and the public. It will better for everyone involved if collaboration between technology companies and auto makers can speed up development of self-driving cars before future fatigue sets in.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

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    Shira Ovide in New York at

    To contact the editor responsible for this story:
    Daniel Niemi at

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