Addressing Google’s Self-Driving Car Manufacturing Efforts: Strategies for Automakers

As Google intensifies its efforts to establish a greenfield manufacturing capability for self-driving cars, automakers need to strategize their responses. At the heart of the issue is whether Google's self-driving cars will pose a significant threat to automakers and how they should prepare for the future.

Assessing the Immediate Threat

While it is unlikely that Google's self-driving cars will pose a major threat in the immediate future, it's important for automakers to recognize the growing potential of autonomous technology. The initial market may be limited to autonomous taxis in large urban centers, but it's only a matter of time before these vehicles become more mainstream.

Automakers' Responses: Developing Their Own Solutions

Given the inevitability of the widespread adoption of self-driving cars, automakers must focus on developing their own autonomous vehicles. Many are already making progress in this area, but there may still be some holdouts that are lagging behind. If this is the case, my suggestion would be for them to reach out to Google to explore collaborative projects. This approach can provide a strategic advantage in navigating the evolving landscape.

Comparisons and Lessons from Tesla

Tesla presents a valuable case study for Google to consider. While Tesla began with the intention to build its own manufacturing facility from scratch, it faced significant financial challenges. Despite the original determination to control its manufacturing process, Tesla's financial struggles highlight the importance of cost control and the benefits of leveraging existing infrastructure.

Another effective strategy for Google would be to enter into a joint venture with an established automotive manufacturer. For example, partnering with Toyota or Nissan would provide Google with the necessary patents and experience in developing driverless technology. These companies, on the other hand, possess the manufacturing expertise and established retail systems that Google is currently lacking. This collaboration could help Google avoid the pitfalls that Tesla has encountered, particularly in terms of managing manufacturing costs and building a robust retail network.

Lessons from Industry Leaders

The technology sector often overestimates its ability to enter new industries and excel. Tech giants like Apple and Nike have learned that success in product manufacturing typically lies in research and development (RD) and marketing, rather than in the manufacturing process itself. This insight can be crucial for Google as it considers its manufacturing approach.

Engaging in a joint venture not only aligns with these lessons but also underscores the hubris that is prevalent in the tech industry. It shows a willingness to adapt and collaborate, which is essential in navigating the complex challenges of autonomous vehicle manufacturing.

Conclusion

While it's unlikely that Google's autonomous vehicles will be an immediate threat, automakers must prepare for the future. By developing their own autonomous vehicles and considering strategic partnerships, they can ensure they are not caught off guard as the market evolves. A collaborative approach, especially with established automotive manufacturers, can provide the necessary expertise and resources to succeed in this evolving industry.

Key Takeaways: The emergence of autonomous vehicles poses significant opportunities for existing automakers. Developing in-house capabilities, learning from case studies like Tesla, and forming strategic partnerships can help them stay competitive in this rapidly changing market.