The Way Forward for Legacy Auto Manufacturers
Why Leveraging Big Data with Quantum Computing is the Solution to a Lack of Innovation in the Automotive Industry
Many car companies call themselves innovators or pioneers but below the surface of their fancy corporate statements and shiny marketing is a crawling approach that is more about hanging onto what’s worked in the past and iterating slowly versus taking risks to create a future that would surprise and delight customers in unimaginable ways.
BY JEREMY LASMAN
There is definitely customer loyalty to distinct brands and without a doubt this isn’t saying people don’t love their vehicles – it’s that the companies that make their vehicles lack heart. They can be better… much, much better.
There is a reason why Tesla is one of the most beloved and successful car brands on the market today. From the ground up they have treated their products more like an updatable computer on wheels rather than a stagnant piece of machinery that serves a driving function and stumbling to add sub-par features on top of an old platform. It is similar to how pivotal the Apple iPhone was to dramatically push the mobile industry forward in 2007. Instead of creating a phone that tried to do smart things on top of inefficient and closed software, they started from a blank slate and designed scaled down computer hardware that opened up more possibilities for how software could be created and used on a mobile device.
Tesla has been the single most important factor in propelling the electric car industry forward. Free of the restraints of conventional legacy car manufacturers, Tesla has persevered despite its poor start with the first Roadster, its “production hell” with the Model 3 and throughout the turbulent economy becoming the world’s most shorted company, and practically every other obstacle conceivable. The corporation is now more than a decade old and appears to be transitioning towards a more “adult” stage of development. With this shift to a larger, more established corporation, it has also proved that an electric vehicle startup can now succeed. This has allowed a slew of new companies to emerge, like Rimac, Rivian, and Faraday Future.
First, let us take a step back. There is a significant distinction between Tesla and legacy automobile manufacturers such as VW, Jaguar, Audi, GM, and others that must be highlighted. This distinction is not due to the fact that they manufacture electric vehicles but anyone who pays attention to the industry is well aware All Battery Electric Vehicles, or BEVs, are the way to go these days. By 2040, the United Kingdom and France will have outlawed the sale of new fossil-fuel vehicles. Norway’s objective is to have all new cars sold in Norway be electric by 2025. Wherever you turn, new countries are joining the fray. Scotland, Germany, the Netherlands, and even India have also already enacted or are close to passing legislation. If we understand that BEVs are unquestionably the way of the future, what will become of today’s legacy vehicle manufacturers? Will they be successful? Will they be forgotten, or will they go bankrupt, or will something else happen?
Why is Tesla Winning?
No other car company in the world has a mission the magnitude of Tesla or has executed like them. I would argue no other organization in the world has done more to accelerate the world’s transition to sustainable energy than Tesla. Tesla isn’t your ordinary car company. It resembles a Silicon Valley technological start-up in most aspects.
Legacy auto companies, also known as “metal benders,” are skilled at producing complex, dependable products on a large scale, but the operating system experience in those products is still lacking compared to what we get on a daily basis with our smartphones, gaming consoles, smart wearables, and other devices. The opposition from clean sheet business like Tesla, Lucid, and Rivian, who are rewriting the rules of the game, is the reason for this paradigm change in the car sector. At their heart, they have accepted technology. The relative significance of software vs hardware in a vehicle has fundamentally shifted as a result of this. The stock prices of firms like Tesla indicate customer and market approval of this future world model.
The spirit of innovation has been at the heart of Tesla’s mission and they have always pushed the boundaries on what we thought possible with electric vehicles, constantly smashing the skeptic’s doubts about feasibility, performance, and mass adoption. Each of their cars are designed to be the safest in the world. Each has 5 star ratings and goes above and beyond industry standards. It is their #1 priority. As far as Autonomous Driving they are leagues ahead of everyone else, investing heavily to create their Dojo Supercomputer to train the Neural Network required to make the best self-driving system. Tesla has revealed its newest quarterly data, claiming that driving with Autopilot active is roughly 10 times safer than driving in a standard car, with a probability of getting involved in a car accident reduced by about 90 percent. When driving without Autopilot, the data reveals that Tesla’s “active safety” capabilities are liable for a five-fold reduction in accident risk compared to the world rate. When driving without Autopilot, Tesla cars had around half the number of accidents as the state average. The most important positive consequence that stands out being the improved mental health for drivers in traffic and long commutes.
As Tesla continues to create the most compelling customer experience other manufacturers are seemingly just making the same cars each year, metaphorically adding a new paint job with incremental features and calling it something new. There is no life in them anymore. They have become just commodities in our garage and gone are the days where people feel cars as an extension of themselves. Sure they look attractive and luxurious but they still feel stuck in the past, but drive a Tesla and it’s a completely different experience. It feels like a rocket-ship.
With a 90 percent overall satisfaction rating, Tesla boasts the most devoted consumers of any automobile manufacturer. Emphasis on the customer experience has resulted in a legion of Tesla fans. Customers buy or lease a Tesla for their next vehicle in a startling 80 percent of cases. Buyers were willing to wait years for their Model 3s in some cases. Customers notice Tesla is unique from the start of the car-buying experience. The whole of the process is under the company’s control, and sales aren’t pushed. They also don’t spend any money on advertising. Tesla wants people to have a positive experience with the brand.
Big Data is The New Oil
Within the framework of a car as a piece of technology Tesla from day one has understood that each stage from concept, design, engineering, manufacturing, production, and maintenance is actually a Big Data challenge. Of course high-level talent and the courage to take risks play a vital role in the process but at each step of the way the ability to process and utilize information accelerates problem solving and keeps the target aimed at the best possible outcomes.
This isn’t an article only evangelizing Tesla, it’s using their high-tech approach to illustrate how other car companies can catch up by learning how to create, organize and process Big Data faster to not only solve bigger problems, but also to shoot for more complex objectives that seem “impossible”.
Similar to how the car is evolving from an internal combustion engine which runs on fuel to an all electric system, companies need to understand it’s not about milking an old architecture for as long as possible with a focus on profits and market share but what your business is actually contributing to humanity. It’s no longer just about competition for market dominance but how much you’re offering to the betterment of the planet, especially leading with the heart of passion. With this refined focus towards collaboration, the shift towards gathering, understanding, and utilizing Big Data is the central blood flow of a successful operation that leaves a legacy that positively impacts the world.
The truth is car companies are being bottlenecked by antiquated approaches and an aversion to taking risks. Seeing the complete Big Data story not only opens up new possibilities for innovation, but gives talent new ways to engage with their projects in fantastic new ways. Giving your employees the best tools not only enhances internal culture but also dramatically improves the end product and experience to your customers.
Most legacy vehicle manufacturers don’t really build all of the parts of the automobile. Instead, they acquire almost all of the components from specialized firms and assemble them Ikea-style with around 30,000 separate pieces making up the average automobile. Each of the components is either made in-house or purchased from a third-party supplier. The manufacturing and delivery of vital components can be slowed by a single piece of the supply chain, resulting in the production line being shut down.
In reality, legacy vehicle manufactures only “possess” the IP for 2 components: the engine and the gearbox. BEVs, on the other hand, do not have typical engines or gearboxes, which is problematic for them. Although electric motors have been developed for companies for decades and have shown to be extremely dependable, legacy vehicle manufacturers have little, if any, considerable experience with them. They’ve got even less in the battery, which is another essential component of a BEV.
Tesla, on the other hand, is aiming for complete vertical integration of practically every component and feature of its product. They build the engines, the bodies, and the seats. They design and create the several computer systems that operate the car’s different components, as well as the program that runs on these cars. While this may not appear to be a significant change when compared to other enterprises such as Google, Amazon, or Apple, it is a significant difference in the automotive industry.
In reality, Tesla’s vertical integration extends much deeper. They built and operate their own charging network and design and program their own automated vehicles. The only thing they don’t completely control is the battery manufacturing process, but speculations say they intend to get into that as well! This ensures that there is no hindrance in manufacturing as well as upkeep of the car. Any problem along the production line can be solved quickly without delaying the car production.
In contrast to existing automotive norms, Tesla has aimed to go further into value generation to alter the industry’s principles. It has not been satisfied with merely being another car original equipment manufacturer (OEM) with a standard profit or market share. Elon Musk, CEO of Tesla wants to achieve the innovation rate and profits of a traditional technology business, and he’s determined to get there. This change in perspective about automobile production should worry legacy players, who normally aim for 1% to 2% productivity increases each year. Beyond Musk’s EV problems, manufacturers will face a slew of disruptive technologies within the next decade, including driverless cars and those yet to be realized. The lesson for other automakers is this: Stop assuming you’ll be ready to compete if you simply make incremental annual progress in such a fast-paced innovation environment.
If automakers want to embrace a high-tech approach toward innovation, they must take more chances and quit fearing failure. They must figure out how to convince shareholders to back their risk-taking, as Tesla has done. If the notion of climate change is accepted and worldwide regulatory tendencies are recognized, the electric car will undoubtedly become the dominant vehicle on the world’s roadways within the next two or three decades. Even though Tesla has established a route to profitability through design and manufacturing, more breakthroughs are projected over the next five years and legacy auto firms still haven’t worked out how to profit from them.
Traditional manufacturers haven’t focused on strategies to boost customer demand either. To keep their goods competitive, they will need to think more creatively and make faster product enhancements than in the past. On a regular rhythm, change cannot be made solely for the sake of change. Investing should be directed toward completely improving the product and consumer satisfaction.
This isn’t to say that carmakers should forsake internal combustion engines and hybrids. It implies they need to think outside the box to fund more transformational product lines. As the new goods grow more successful, the old items will become less dominating, necessitating fewer redesigns and direct investment.
From supply chain to 3D printing innovations to robotic assembly lines and self-driving, there is more data to gather and understand than ever before yet legacy car companies continue to pretend to be pioneering. Instead of truly innovating, they keep an old architecture and retrofit wires on top of old hardware to create “new” features like lane departure warnings and park assist. However, when it comes to car intelligence no other company in the world is anywhere close to the vicinity of smart driving or even self-driving compared to Tesla. If legacy car companies were to actually be innovative and build using Tesla’s approach of a computer car versus a machine with a computer on top of it, they wouldn’t just get very slow iterative features that pretend to be innovative, and would actually start to set the foundation to catch up with Tesla.
At the moment, legacy cars are like using an old cell phone with little features that they think people want and do, but when compared to driving a Tesla they aren’t even in the same ballpark anymore. Auto companies really have two choices right now. On one hand they can keep going slowly and be afraid of the time and cost of restarting from the ground up or they can do something more challenging and have an autonomous driving roadmap in their future instead of more pseudo-smart car features. It comes down to taking steps right now to invest into what they truly are after and challenging themselves at the risk of quarterly earnings to establish the technology, the data collection, the tools, and the talent to be able to step up their game to speed their own execution of self-driving systems. They don’t even have to build their own supercomputer like Tesla, instead they can turn to where the puck is going which is Quantum Computing.
There is a massive amount of data ready to be unearthed that car companies are not seeing, coupled with the amount of data that they already have at their disposal in their organization that they have no clue how to use effectively to transform the entire operation of the company. Currently, the automobile sector stands to gain from one-tenth of all possible QC use cases being investigated. In fact, by 2025, automotive will be one of the key value pools for QC, with a significant influence. By 2030, experts project that associated technologies will have a $2 billion to $3 billion economic effect on the automobile sector. Solving challenging optimization issues, such as processing large volumes of data to expedite learning in autonomous vehicle navigation algorithms, will provide the majority of the early value added.
When contemplating Quantum Computing as a solution to current automobile difficulties, “modern problems deserve modern solutions” is an exact and most relevant expression. All of the major automakers are considering vehicles that operate on batteries rather than conventional fossil fuels and include automation into the steering and operating processes. The transition from fossil fuels and driver-centric cars to battery-powered, drive-less, or self-driving automobiles is as complicated as it sounds. Many autonomous cars have been built and are being examined on a regular basis, although they have failed in some regions. The smooth autonomous driving experience is still a long way from becoming commercially viable and safe. Considerably while the degree of development for these vehicles is now rather advanced, it will become even more complicated in the future.
That’s where Quantum Computing comes in, assisting car businesses with sophisticated computations and estimations in order to provide a trustworthy autonomous experience. Despite the fact that quantum computing is still in its development, automakers such as Volkswagen have begun to take minor efforts toward incorporating it into real-world applications. VW aims to use quantum computing to decrease road congestion in conjunction with Google and D-wave, a quantum computing business located in Canada. Cellphones and transmitters inside vehicles are used to collect traffic data. This information is used to determine the traffic density in a certain location as well as the number of customers that require a carrier using a non-quantum method. The number of carriers available vs the number of consumers wanting a carrier may thus be readily optimized using quantum computations. The target region can be optimized by directing cabs or a public transportation service provider in the right direction. This component of Quantum Computing might very well be useful to autonomous cars in the near future, where these vehicles could be steered to a certain focal region or warned to avoid that area entirely, especially in congested areas.
Quantum Computing gives a new toolset to not only bring more data together that have previously been stuck in silos of separate departments or specific projects but also to process highly complex algorithms which will facilitate more efficient solutions to everything that has been restricting their company from actually living up to what they say that they are. When car companies are ready to truly innovate and invite the hearts and minds of their employees to challenge the status quo to bring about brand new technologies all the sudden the vision of the future that we see will become a reality like RoboTaxis, improved traffic flow, a thriving environment, and beyond!
Quantum Computing is mind-blowing because it is no longer constrained by the classical approach to processing information in a linear fashion. Instead it completely opens up a fresh canvas to give your talent new ways to dream up solutions that were previously impossible. It is by leveraging Big Data with Quantum Computing that will give legacy car companies the solution to their lack of innovation and a roadmap back to the heart of being a pioneer.
In other words when companies open up to questioning where they are being closed off to new ideas and approaches they will set the stage for a complete revolution in the auto industry and revitalize the connection to their customers by designing products with more heart. The choice is clear, either follow suit like Tesla hobbling to figure out how best to implement artificial intelligence, machine learning, neural networks and other Big Data strategies or step up and commit to the next great evolution in technology which is Quantum Computing.
Leave a Comment