While Ford Autonomous Vehicles LLC (AVLLC) is a distinct business unit from Smart Mobility LLC, it is very closely related.
“I’d say what you’re increasingly going to see from Ford is a consolidation in a way of our pre-AV and AV business. I’m not going to get into the specifics of what our AV brand and services are going to look like, the portfolio, but just imagine for Ford we really see those as one entity.”
From the time in August 2016, that former CEO Mark Fields announced the company’s intention to produce a level 4 automated vehicle “for use in commercial mobility services such as ride sharing and ride hailing within geo-fenced areas and be available in high volumes” the company has been working on multiple parallel paths. The core automated driving technology development has been put in the hands of Argo AI. Teams from AVLLC have been working alongside the Argo team as well as colleagues from Smart Mobility to understand the business models that can lead to building a commercially viable mobility ecosystem.
Meanwhile the Ford product development team has been trying to take the lessons learned from experiments like delivering pizzas and dry cleaning in places like Ann Arbor, Miami and Washington DC to device a purpose built vehicle that can withstand the rigors of continuous daily use.
Ford’s initial hope of high volume deployment of L4 AVs in 2021 was seen by many at the time and even now as lagging behind the leaders in the industry like Waymo and even Cruise. Today, it seems like a much more pragmatic projection.
“So, I don’t have a lot of new news for you, except for a couple things. First of all, we’re going to spend more than the $4 billion that we committed to. And there’s a lot of reasons for that but one of the most important is that we’re committed to having a customer facing business. And that costs marketing dollars and a lot of software development.”
However, the pace of growth is likely to be somewhat smaller than the “high volume” business promised over three years ago.
“The other thing is that, the timeframe is about right. But when we get to that, scaling of the business, especially now that we’re committed to having a consumer facing business and goods movement and people, we’re not putting pressure on the team to, we want to go as fast as we can.”
However, Farley recognized that while tremendous progress has been made in developing a natural driving system, there are still enormous technical and commercial challenges. The lidar and other sensors and compute platforms required to build a robust system are still costly and power hungry. As a company that is familiar with building vehicles for applications like police vehicles and taxi services that have to last hundreds of thousands of miles in just a few years, Ford understands the hurdles that will have to be overcome to make all aspects of the vehicles “commercial grade.”
Farley is happy with the lessons that have been learned from the user experience experiments that have been done and how that has been incorporated into the production intent vehicle. A key factor for Farley is how will Ford’s customer facing business differentiate itself from a driven experience.
“It seems like the industry was so focused on robot taxi kind of generic movement of people.”
“The way we’re thinking about is much more precise on the differentiation for subsets of those customers, where we think we can add a lot of value beyond pulling the driver. So pulling the drivers really fascinating as a human, you can see what’s happening with summon mode and Telsa and all the videos going around, everyone’s as humans, – the car there’s no one in it it’s driving itself, that’s very fascinating. But really from a customer standpoint. If you’re developing a service, you pull the driver. What’s better. That’s what we’re working on and that’s where we need to make more progress.”
In essence, getting rid of the human drivers in transportation services is just one piece of the overall puzzle for automated vehicles. While you might eliminate an individual’s salary, at various stages of the value chain, there will remain a need for human interaction, or perhaps an entirely different type of automation. This could be a robot that delivers packages from the AV to the doorstep such as the one from Agility Robotics that Ford is experimenting with or drones that might complete the delivery from automated cargo vans. It could also be nurses or aides riding along to aide someone being transported to a dialysis or chemotherapy appointment.
Interestingly, Farley was also non-committal on exactly how AVs would be deployed for different use cases. In the past, Ford has indicated that it would like flexible vehicles that could be used for passengers, packages, meals and more, shifting throughout the day as needed.
“We think that when you look at humans getting in and out of a self driving vehicle, and you look at the form factor for urban goods delivery, there is a sweet spot. But the vehicle, the way it’s configured will have to be totally different. And that’s one of the things we learned in Miami we tried to do both in the same vehicle, and we learned that for a lot of applications iIf you want to be highly utilized, having the same configuration on the interior isn’t optimal.
So what we may end up seeing is multiple sets of vehicles within the fleet with some handling passengers and others deliveries. If they can achieve enough scale that may well turn out to be a commercially viable solution. Or not. It’s premature to be certain.
Ford has been testing a range of form factors for its upcoming automated vehicles
One thing that is certain is that Farley wants Ford’s service to be customer facing. While that means Ford will be working with partners to provide those services, it most likely rules out operating Ford AVs on other ride-hailing networks such as Lyft or Uber or at least not without substantial branding so that customers know who is behind these vehicles. Farley also declined to be specific on whether that branding will be Ford or some name we haven’t heard yet.
Either way, that is part of the reason that the total investment for its automated driving investments will grow beyond $4 billion. That increase will fund the software platforms required to support a robust consumer facing brand and marketing dollars to establish the brand in the mobility services marketplace.
For a guy that loves driving fast cars, leading a 116-year old automaker into a highly uncertain future of mobility as a service is a huge challenge, but Jim Farley and the rest of the team at Ford seem to be taking a very thoughtful and holistic approach to the many tasks at hand.