Google Woo of German Carmakers Draws Audi Snub Over Privacy Woes

Updated on

Google Inc.’s avowed strategy of courting German carmakers into partnerships got a snub from Audi AG amid concerns that Internet-assisted driving may risk intruding on passenger privacy.

For Germany’s auto industry, “the Internet, cookies and other data collectors are almost common courtesy,” Audi Chief Executive Officer Rupert Stadler said today in a speech to executives in Berlin. “But a car today is a second living room -- and that’s private.”

Carmakers from Toyota Motor Corp. to General Motors Co. to PSA Peugeot Citroen are investing heavily in an industry shift in which software plays a vital role and new competitors and alliances emerge. The comments signal a move by German auto builders to tap domestic reservations about data protection as they attempt to build rival platforms to challenge Google for market share in Internet-assisted motoring.

“I want to emphasize we’re doing this with partners,” Schmidt said. “In our case, we’re working with a whole infrastructure here in Germany.”

Speaking at the same event, Google Chairman Eric Schmidt said the Internet technology company wants “essential” German expertise to realize its European automobile projects. The California-based company has worked with Audi, Adam Opel AG and Volkswagen AG in an “Automobile Alliance” for about a year, Schmidt said.

Schmidt’s speech was billed by event organizers -- the industrial wing of Chancellor Angela Merkel’s Christian Democrats -- as a review of the economic “wunder,” or miracle, offered by the digital economy.

Digital Features

Stadler reiterated that Ingolstadt-based Audi, which ranks second worldwide to BMW AG in making luxury vehicles, sees electronics and digital features becoming as important as horsepower to manufacturers’ product value by the end of the decade.

Audi and its German counterparts have set aside rivalries to bid as a group for Nokia Oyj’s HERE digital-map division. Auto producers are pushing for deeper integration of electronic functions in vehicles, such as in-car connectivity. HERE’s maps could help limit Google’s inroads by providing the basis for technology including automated driving.

Volkswagen AG, Audi’s parent company, set up a task force last year to speed up the adaptation of technology for new models. Wolfsburg, Germany-based VW said on May 22 that its Car-Net system will package applications for on-board use of drivers’ smartphones or tablets operating on Google’s Android Auto software or Apple Inc.’s CarPlay and include voice recognition.

“Customers want to be at the center” of their car-ownership “and not exploited for it,” Stadler said Tuesday. “They want to be in control of their data and not subject to monitoring. And we take this seriously.”