400,000 pre-orders for a car that'll only hit the roads end of 2017 is something that the incumbents can't ignore anymore. After all 400,000 pre-orders for Tesla's Model that plays in the league of Mercedes C-class, BMW 3 series or Audi A4 will block those buyers from becoming customers for those car makers in the next 2-3 years. And that means 10% to 15% lower sales for each of the incumbents. That does hurt.
How did nobody see that coming? Fact is that everyone has access to the same technologies and concepts, as well as seen the information and news. And yes, a company like BMW went really far with lots of innovations on their i3, but not far enough. And now their electric car team has been hired by a Chinese company.
While visiting my hometown Vienna in Austria, I went to the Imperial Carriage Museum and learned about a certain Carl Marius. He was the emperor's favorite carriage maker. Why nobody has heard about him today is because he never made the switch from carriages to cars. This is a pattern that we see unfold today again.
It's not about potential: it's about the will to change the world. If you just want to defend the Status quo, somebody with more ambition will come and do what you didn't. And once more the revolution is led by Silicon Valley. But this time it's different: China is following with high speed in Silicon Valley's footsteps. Considering that China, Israel or India are years ahead of using battery-powered vehicles with mopeds, there is no chance that Germany, France, or Italy are able to close the gap. Even those companies in a crisis like Volkswagen say much, but do everything that is the opposite.
Mercedes and BMW look very much like the Ladas and Trabants. Low ambition, satisfied with what they have, and telling their customers that more is not possible. While the customers see the very impossible being done by Tesla, Google, Apple & Co Volkswagen just a beetle that should be put into a history museum.
The 2nd Car Revolution (which is also the title of my next book - as a spin-off of my current book Das Silicon Valley Mindset) will be very likely won by newcomers from China, the US, and India.
Get my book on Amazon! 400 pages, €19,99.
Did you know that Germany employees 800,000 people in the car industry? And the US another 4 million? 20% of Germany's exports are car-related. But now we talk mostly about millions of cars being recalled because of the Diesel-scandal that encompass now nearly every automaker. Not to mention the costs to society because of them trying to cheat themselves out of disruptive innovation.
On a lighter note, some regulators expect unintended consequences from the advent of autonomous cars. Passengers would suddenly have time not just for work while riding, but some other things as well. SIGH! People are ruining everything! ;-)
Autonomous vehicles will push AI to the next level. And all this could be sooner here than everyone imagines.
To make a deep dive into Artificial Intelligence, a conference in SF end of May will help you get a clearer picture. The one-day conference includes speakers from Uber, Airbnb, and Bloomberg. Here is a 20% discount for the conference.
SUBSCRIBE TO MY NEWSLETTER.
READ MY PAST NEWSLETTERS HERE.
Do BMW, Daimler, Ford, GM, Volkswagen etc. have a fighting chance surviving the 2nd car revolution? Maybe. If they don't make any mistakes. And if they fully commit. Given the news, I more and more doubt it.
They'd need to learn a lot about innovation culture, and change the focus from short-term to long-term benefits. Without founders at the steering wheel and just with managers trying to keep their jobs and not risk anything, that's very very tough, though not impossible. Interestingly enough I think that car suppliers are in a much better situation to survive the shakeup than the big automakers. But that's a topic for another time.
The best known method to infuse your company with more innovation culture is Design Thinking. Created by IDEO and pushed into the corporate world as a new skill-set by SAP-co-founder Hasso Plattner nearly two decades ago, many companies are rolling out Design Thinking. And I can only recommend that, not only because of some exercises that involve tasty Marshmallows.
To experience yourself what the Silicon Valley does right about innovation and what the latest trends are, join our Silicon Valley Inspiration Tours that give you multi-day deep dives into the San Francisco Bay Area. See more tour details here. Here is also a list of preparatory steps for your visit.
SUBSCRIBE TO MY NEWSLETTER.
READ MY PAST NEWSLETTERS HERE.
NSFW - How to photograph a locomotive from the bottom
Today's NSFW - internet lingo for Not Safe For Work - is for a child born into a railway family like myself the ultimate geek out. Bulgarian photogapher Yasena Popova took pictures of vehicles - from underneath. Her series titled Urban Insects also included a locomotive, which was a special challenge. Here is a video of how with the help of railway engineers she could take the pictures.