Why Your Car Will Become Even More Like an iPhone
Doug Field, who left Apple for Ford in September, talks about automation and Detroit vs. Silicon Valley.
Doug Field, who left Apple for Ford in September, talks about automation and Detroit vs. Silicon Valley.
Car companies are trying to change a century-old business model: Make a car, sell it, and hope the customer comes back years later to buy another one.
Instead, they’re increasingly developing vehicles as digital devices, with the ability to remotely beam new services and features to the car that could make it easier and more fun to use—while notching extra revenue.
For traditional auto makers, the ability to update cars like an iPhone is in its infancy, though Tesla Inc. pioneered the practice. When Ford Motor Co. was looking for help with the digital transition, it plucked Doug Field, a former Tesla and Apple Inc. executive, to lead the charge in coming up with new digital features to foster an “always-on” connection to customers.
Mr. Field spent five years at Tesla, including as engineering chief, where he helped develop the Model 3. He did two stints at Apple, most recently starting in 2018 as vice president of special projects, before joining Ford in September.
He talked to The Future of Everything about what to expect from the car-ownership experience in the years ahead. Electrification and at least partial automation will be the norm, he predicts. For auto makers, the real differentiator will be offering an immersive experience, transforming the vehicle into a home-entertainment studio, gaming platform or conference room.
“The disruption in the auto industry, driven by software, autonomy and electrification, is going to be as big as anything that’s happened in the last century,” Mr. Field says.
Autonomy is the best example. You might choose different packages, a subscription-based service for how the vehicle operates autonomously. That’s already the way it works at Tesla. Once you have autonomy, you’ve unlocked the ability to do other things in the vehicle. Today, there are features that are fully hands off, but you’ve got to keep your eyes on the road. I’m talking hands off, eyes off [in the future]. And if you need to drive again, you have plenty of notice. It’s a very gentle experience to take over, and if you don’t, there’s a very gentle response to pull over into a safe situation. It’ll be a much smoother transition between humans and autonomy than this idea of a big switch that gets flipped from one to the other.
Content absolutely will be a la carte. You’ll see certain types of connectivity and features that might involve a situation where, for example, a car is shared by five people. You could have a circle of friends who decide they’re going to buy a car together. There’s a little scheduling app that basically keeps track of who’s going to use the vehicle when, making sure that it’s charged in between. So it’s not just the software inside the vehicle, but it’s also the services that free people from the burden of car ownership while maintaining their connection with the product.
Through software, yes. Successful tech companies build hardware carefully, with not a huge amount of variation, and then put the variation in those products through software. A lot of the [auto] industry has grown up with massive variation. With technology differences, you have a fundamentally differentiated product. You don’t have to chop your lineup into all these tiny little slices. You’re going to have fewer models.
You don’t show off your phone anymore. And your identity doesn’t feel threatened when somebody else has an iPhone 13. My differentiation is in things like my Twitter page or my Instagram. It’s a very different way that people create their identity, whereas in the past, a car was a big part of that. I think that will largely fade away. There will always be niche products that are really unique and fun to drive and heavily styled, like Ferraris and Lamborghinis. Horses didn’t go away when cars came along, but they became recreational. Sports cars will be recreational.
Where the auto manufacturers can do things that are really special are vehicle-specific. The companies that do this really well will have products that people will walk out of their homes and sit in for the experience, even if they’re not going anywhere. A company that does this right could theoretically take the wheels off and plop it in your backyard and it’s a product, like an Airstream. It becomes fundamentally the best place you could have a conference call or listen to music or watch a movie.
This story is being written right now, and the outcome is not yet clear. Technology transitions allow a whole bunch of new people to come in. These people come in with a blank slate, they get to shed all the baggage. The path for a [traditional auto maker] is to figure out how to leverage history and shed baggage, and that is very, very hard. There’s a race on. Are [auto makers] going to learn tech and customer experience faster than the startups are going to learn high-volume, high-quality, low-cost production and a bunch of other things people take for granted in cars? It’s a race.
Interview has been condensed and edited.
Reprinted by permission of WSJ. Magazine. Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: November 4, 2021.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
Vacationers scratching their travel itch this season are sending prices through the roof. Here’s how some are making trade-offs.
Capri Coffer socks away $600 a month to help fund her travels. The Atlanta health-insurance account executive and her husband couldn’t justify a family vacation to the Dominican Republic this summer, though, given what she calls “astronomical” plane ticket prices of $800 each.
The price was too high for younger family members, even with Coffer defraying some of the costs.
Instead, the family of six will pile into a rented minivan come August and drive to Hilton Head Island, S.C., where Coffer booked a beach house for $650 a night. Her budget excluding food for the two-night trip is about $1,600, compared with the $6,000 price she was quoted for a three-night trip to Punta Cana.
“That way, everyone can still be together and we can still have that family time,” she says.
With hotel prices and airfares stubbornly high as the 2023 travel rush continues—and overall inflation squeezing household budgets—this summer is shaping up as the season of travel trade-offs for many of us.
Average daily hotel rates in the top 25 U.S. markets topped $180 year-to-date through April, increasing 9.9% from a year ago and 15.6% from 2019, according to hospitality-data firm STR.
Online travel sites report more steep increases for summer ticket prices, with Kayak pegging the increase at 35% based on traveler searches. (Perhaps there is no more solid evidence of higher ticket prices than airline executives’ repeated gushing about strong demand, which gives them pricing power.)
The high prices and economic concerns don’t mean we’ll all be bunking in hostels and flying Spirit Airlines with no luggage. Travellers who aren’t going all-out are compromising in a variety of ways to keep the summer vacation tradition alive, travel agents and analysts say.
“They’re still out there and traveling despite some pretty real economic headwinds,” says Mike Daher, Deloitte’s U.S. transportation, hospitality and services leader. “They’re just being more creative in how they spend their limited dollars.”
For some, that means a cheaper hotel. Hotels.com says global search interest in three-star hotels is up more than 20% globally. Booking app HotelTonight says nearly one in three bookings in the first quarter were for “basic” hotels, compared with 27% in the same period in 2019.
For other travellers, the trade-offs include a shorter trip, a different destination, passing on premium seat upgrades on full-service airlines or switching to no-frills airlines. Budget-airline executives have said on earnings calls that they see evidence of travellers trading down.
Deloitte’s 2023 summer travel survey, released Tuesday, found that average spending on “marquee” trips this year is expected to decline to $2,930 from $3,320 a year ago. Tighter budgets are a factor, he says.
Wendy Marley is no economics teacher, but says she’s spent a lot of time this year refreshing clients on the basics of supply and demand.
The AAA travel adviser, who works in the Boston area, says the lesson comes up every time a traveler with a set budget requests help planning a dreamy summer vacation in Europe.
“They’re just having complete sticker shock,” she says.
Marley has become a pro at Plan B destinations for this summer.
For one client celebrating a 25th wedding anniversary with a budget of $10,000 to $12,000 for a five-star June trip, she switched their attention from the pricey French Riviera or Amalfi Coast to a luxury resort on the Caribbean island of St. Barts.
To Yellowstone fans dismayed at ticket prices into Jackson, Wyo., and three-star lodges going for six-star prices, she recommends other national parks within driving distance of Massachusetts, including Acadia National Park in Maine.
For clients who love the all-inclusive nature of cruising but don’t want to shell out for plane tickets to Florida, she’s been booking cruises out of New York and New Jersey.
Not all of Marley’s clients are tweaking their plans this summer.
Michael McParland, a 78-year-old consultant in Needham, Mass., and his wife are treating their family to a luxury three-week Ireland getaway. They are flying business class on Aer Lingus and touring with Adventures by Disney. They initially booked the trip for 2020, so nothing was going to stand in the way this year.
McParland is most excited to take his teen grandsons up the mountain in Northern Ireland where his father tended sheep.
“We decided a number of years ago to give our grandsons memories,” he says. “Money is money. They don’t remember you for that.”
Chima Enwere, a 28-year old piano teacher in Fayetteville, N.C., is also headed to the U.K., but not by design.
Enwere, who fell in love with Europe on trips the past few years, let airline ticket prices dictate his destination this summer to save money.
He was having a hard time finding reasonable flights out of Raleigh-Durham, N.C., so he asked for ideas in a Facebook travel group. One traveler found a round-trip flight on Delta to Scotland for $900 in late July with reasonable connections.
He was budgeting $1,500 for the entire trip—he stays in hostels to save money—but says he will have to spend more given the pricier-than-expected plane ticket.
“I saw that it was less than four digits and I just immediately booked it without even asking questions,” he says.
Predicted increases in value signals strength in local property market.
What this ‘median’ 7-figure price tag scores across Australia.