Bob Lutz: Kiss the good times goodbye
Skip to main content
Sister Publication Links
  • Automotive News Canada
  • Automotive News Europe
  • Automotive News China
  • Automobilwoche
AN-LOGO-BLUE
Subscribe
  • Subscribe
  • Account
  • login
  • HOME
  • NEWS
    • Dealers
    • Automakers & Suppliers
    • News by Brand
    • Cars & Concepts
    • Final Assembly
    • China
    • Shift
    • Mobility Report
    • Special Reports
    • Digital Edition Archive
    • This Week's Issue
    • Prince Philip died April 9.
      Philip's custom Land Rover hearse gets called into duty
      Still no auto show, so Detroit tries car crawl
      Diess chose VW over CEO job at Tesla
      The special-edition GT-R Nismo goes on sale in North America this fall. It does not come with a Happy Meal.
      Nissan's 600-hp hamburger helper
    • Shanghai Tesla protest
      Tesla apologizes as anxiety grows after driver protest
      Jaguar at Shanghai show.jpg
      Jaguar Land Rover expects luxury sales to grow in 2021
      Hyundai logo
      Hyundai Group to launch EVs every year starting in 2022
      The Ford Mustang Mach-E assembled at Ford's joint venture with Changan Automobile Co.
      Ford starts preorders for locally built Mustang Mach-E
    • VW unit is pumping funds into mobile charging robot
      Companies work smarter, not harder, with logistics-focused robots
      Other industries combine for more bot orders than automakers, suppliers
      Gatik capitalizes on growing demand for shorter-distance deliveries
    • Volvo Didi test car 2.jpg
      Volvo will provide XC90s for Didi's self-driving test fleet
      Hyundai logo
      Hyundai Motor Group names chief for new mobility division
      Tesla Autopilot web.jpg
      Tesla, ex-engineer settle lawsuit over Autopilot source code
      Cruise self-driving vehicle
      Cruise raises $2.75 billion from Walmart, others
    • Elon Musk interview
      Tesla’s Model Y, on sale since March, is a showcase of EV technologies competitors will benchmark.
      Technologies of Electrification
      Cadillac’s Lyriq EV will be unveiled Aug. 6.
      Future Product Pipeline
      A CALL TO ACTION
    • Lithia goes big on Michigan market
      Mercedes bypasses crossover route, enters EVs sedan-first
      Mercedes' new U.S chief: EVs won't kill profits
      Get even more Automotive News with our new app
    • Access F&I
    • Fixed Ops Journal
    • Marketing
    • Used Cars
    • Retail Technology
    • Sales
    • Best Practices
    • Dealership Buy/Sell
    • NADA
    • NADA Show
    • Automakers
    • Manufacturing
    • Suppliers
    • Regulations & Safety
    • Executives
    • Talk From The Top
    • Leading Women Network
    • Guide to Economic Development
    • PACE Awards
    • Management Briefing Seminars
    • World Congress
    • Aston Martin
    • BMW
      • Mini
      • Rolls-Royce
    • Daimler
      • Mercedes Benz
      • Smart
    • Ford
      • Lincoln
    • General Motors
      • Buick
      • Cadillac
      • Chevrolet
      • GMC
    • Honda
      • Acura
    • Hyundai
      • Genesis
      • Kia
    • Mazda
    • McLaren
    • Mitsubishi
    • Nissan
      • Infiniti
    • Stellantis
      • Alfa Romeo
      • Citroen
      • Chrysler
      • Dodge
      • Ferrari
      • Fiat
      • Jeep
      • Lancia
      • Maserati
      • Opel
      • Peugeot
      • Ram
      • Vauxhall
    • Renault
    • Subaru
    • Suzuki
    • Tata
      • Jaguar
      • Land Rover
    • Tesla
    • Toyota
      • Lexus
    • Volkswagen
      • Audi
      • Bentley
      • Bugatti
      • Lamborghini
      • Porsche
      • Seat
      • Skoda
    • Volvo
    • (Discontinued Brands)
    • Virtual reveals (Sponsored)
      • MITSUBISHI: 2022 Outlander
      • NISSAN: 2022 Pathfinder and 2022 Frontier
      • GENESIS: 2021 GV80
      • KIA: 2021 K5
      • LEXUS: 2021 IS
      • NISSAN: 2021 Rogue
      • TOYOTA: 2021 Venza and 2021 Sienna
    • Auto Shows
    • Future Product Pipeline
    • Photo Galleries
    • Car Cutaways
    • Design
  • OPINION
    • Blogs
    • Cartoons
    • Keith Crain
    • Automotive Views with Jason Stein
    • Columnists
    • China Commentary
    • Editorials
    • Letters to the Editor
    • Send us a Letter
    • used car blog art 2010 Mini Cooper
      Used-car market sizzling for sellers, not so great for buyers
      It's time to rethink EV range
      Mercedes EQS mirrors web.jpg
      For the EQS, Mercedes likes what it sees in the mirror
      Mach-E
      For Ford, 3rd-party charging network must improve to reap Mustang Mach-E potential
    • EVs Arrived EVentually
      EVs Came, EVentually
      In case of supply chain woes, break glass
      Quick! The Biden phone
      VW's Joke Is On You
      Joke Is On You
      view gallery
      4 photos
      Leo Michael Cartoons - Q2 2021
    • Shifting gears away from the stick shift
      SEMA still a wonderful circus
      Penske still has plenty of races to win
      Ford's turn in the hot seat
    • April 20, 2021 | The future of working may be hybrid
      April 13, 2021 | GM shows it’s serious about electric
      April 6, 2021 | For Volkswagen, authenticity is the only path forward
      March 30, 2021 | Tesla “changes” car industry
    • Supreme Court must preserve system that has delivered huge reductions in emissions
      Dave Versical
      For Manheim head, fighting anti-Asian hate is personal
      Tom Roberts
      Will the auto industry rethink supply chain disruption now?
      GM lost a lot on EV1, but project pays dividends
    • Why Xiaomi holds promise of becoming formidable EV player
      Geely’s new EV push is decidedly new age
      Charging poles installed outside a Tesla store in downtown Shanghai.
      Unreliable public EV charging sites prompt automakers to take wheel
      VW Group's playbook to dominate EV market
    • Despite demise, EV1 was a risk worth taking
      A step in right direction for Nissan dealers
      ‘Voltswagen' April Fools' gag far from funny
      Less is more in lineups as well as on lots
    • Lunn was behind vehicles with impact
      ‘Voltswagen' was clever and fun
      With EVs, bias for traditional carmakers
      There goes VW recycling again
  • DATA CENTER
  • VIDEO
    • AutoNews Now
    • First Shift
    • Special Video Reports
    • Weekend Drive
    • AutoNews Now: Stellantis managers indicted on emissions fraud
      AutoNews Now: Toyota's Carter says EV portfolio will be varied
      AutoNews Now: Ram output said to be slowing as COVID cases surge
      AutoNews Now: Stellantis outlines electrification targets for U.S., Europe
    • First Shift: Tesla's Musk: Autopilot not in use during deadly crash
      First Shift: GM: Market could alter 2035 EV goal
      First Shift: Indicted ex-Nissan exec Kelly 'blameless,' U.S. senator says
      First Shift: Ford, Nissan plan more downtime amid chip crisis
    • The life, death and legacy of GM's groundbreaking EV1
      Face-to-face with the General Motors EV1
      Toyota store's in-house training program retains more techs
      Virtual sales manager Jay Barger
      'Glued to a phone': Acura store's virtual sales boss lifts deliveries, efficiency
    • Why the pickup is the auto industry's 'battleground'
      Carlos Ghosn's quest to restore his reputation
      Why Ford must execute to avoid 'deep trouble'
      Why Honda is 'locked and loaded' for 2020
  • EVENTS & AWARDS
    • Events
    • Awards
    • Congress Conversations
    • Retail Forum: NADA
    • Canada Congress
    • Europe Congress Conversations
    • Fixed Ops Journal Forum
    • Shift: Mobility at a Crossroads
    • 100 Leading Women
    • 40 Under 40 Retail
    • All-Stars
    • Best Dealerships To Work For
      • Register for the 2021 Best Dealership To Work For
    • PACE Program
    • Rising Stars
    • Europe Rising Stars
  • JOBS
  • AN Solutions
  • +MORE
    • Leading Women Network
    • Podcasts
    • Webinars
    • In the Driver's Seat
    • Publishing Partners
    • Classifieds
    • Companies on the Move
    • People on the Move
    • Newsletters
    • Contact Us
    • Media Kit
    • RSS Feeds
    • Shift: A Podcast About Mobility
    • Special Reports Podcasts
    • Daily Drive Podcasts
    • AAM
    • Cars.com
    • DealerPolicy
    • Gentex
    • IHS Markit
    • Remember Group
    • Reputation.com
    • Ricardo: Dave Shemmans
    • Ricardo: Marques McCammon
    • Allstate: Want more from your F&I?
    • Ally: Navigating the future of automotive retailing
    • Amazon Web Services: Any place, any time, any channel
    • Amazon Web Services: The power of the cloud
    • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
    • Capital One Auto: Dealerships remain vital to an increasingly digital car shopping journey
    • DealerSocket: 5 steps to modernizing the buyer's journey
    • Epic Games: Build stunning, real-time car configurators with Unreal Engine
    • Epic Games: Real-time tech is the next frontier of automotive
    • Epic Games: Transforming the auto industry with digital assets
    • FTI Consulting: Crisis as a catalyst for change
    • Google: 5 trends shaping the auto industry's approach to a new normal
    • Google: Google's dealer guidebook helps dealers navigate today's digital landscape
    • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
    • IHS Markit: COVID-19: The future mobility delusion
    • Level5: 2020 Automotive E-Commerce Report
    • Motormindz: Toward hyperconnectivity: 5 ways to position your business to profit from connected car
    • Naked Lime: Bring social reputation together as part of big-picture marketing
    • Ally: Do It Right
MENU
Breadcrumb
  1. Home
  2. Industry Redesigned
November 05, 2017 01:00 AM

Bob Lutz: Kiss the good times goodbye

'Everyone will have 5 years to get their car off the road or sell it for scrap'

Bob Lutz
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print

    This article will be included in “Redesigning the Industry,” a five-part Automotive News series exploring the future of a business in the throes of change.  Part I begins in our Nov. 6 issue with a focus on “Predictions & Possibilities.”

    It saddens me to say it, but we are approaching the end of the automotive era.

    The auto industry is on an accelerating change curve. For hundreds of years, the horse was the prime mover of humans and for the past 120 years it has been the automobile.

    Now we are approaching the end of the line for the automobile because travel will be in standardized modules.

    The end state will be the fully autonomous module with no capability for the driver to exercise command. You will call for it, it will arrive at your location, you'll get in, input your destination and go to the freeway.

    On the freeway, it will merge seamlessly into a stream of other modules traveling at 120, 150 mph. The speed doesn't matter. You have a blending of rail-type with individual transportation.

    Bob Lutz is a former vice chairman and head of product development at General Motors. He also held senior executive positions with Ford, Chrysler, BMW and Opel.

    Then, as you approach your exit, your module will enter deceleration lanes, exit and go to your final destination. You will be billed for the transportation. You will enter your credit card number or your thumbprint or whatever it will be then. The module will take off and go to its collection point, ready for the next person to call.

    Most of these standardized modules will be purchased and owned by the Ubers and Lyfts and God knows what other companies that will enter the transportation business in the future.

    A minority of individuals may elect to have personalized modules sitting at home so they can leave their vacation stuff and the kids' soccer gear in them. They'll still want that convenience.

    The vehicles, however, will no longer be driven by humans because in 15 to 20 years — at the latest — human-driven vehicles will be legislated off the highways.

    The tipping point will come when 20 to 30 percent of vehicles are fully autonomous. Countries will look at the accident statistics and figure out that human drivers are causing 99.9 percent of the accidents.

    Of course, there will be a transition period. Everyone will have five years to get their car off the road or sell it for scrap or trade it on a module.

    The big fleets

    CNBC recently asked me to comment on a study showing that people don't want to buy an autonomous car because they would be scared of it. They don't trust traditional automakers, so the only autonomous car they'd buy would have to come from Apple or Google. Only then would they trust it.

    My reply was that we don't need public acceptance of autonomous vehicles at first. All we need is acceptance by the big fleets: Uber, Lyft, FedEx, UPS, the U.S. Postal Service, utility companies, delivery services. Amazon will probably buy a slew of them. These fleet owners will account for several million vehicles a year. Every few months they will order 100,000 low-end modules, 100,000 medium and 100,000 high-end. The low-cost provider that delivers the specification will get the business.

    These modules won't be branded Chevrolet, Ford or Toyota. They'll be branded Uber or Lyft or who-ever else is competing in the market.

    The manufacturers of the modules will be much like Nokia — basically building handsets. But that's not where the value is going to be in the future. The value is going to be captured by the companies with the fully autonomous fleets.

    The end of performance

    These transportation companies will be able to order modules of various sizes — short ones, medium ones, long ones, even pickup modules. But the performance will be the same for all because nobody will be passing anybody else on the highway. That is the death knell for companies such as BMW, Mercedes-Benz and Audi. That kind of performance is not going to count anymore.

    In each size vehicle, you will be able to order different equipment levels. There will be basic modules, and there will be luxury modules that will have a refrigerator, a TV and computer terminals with full connectivity. There will be no limit to what you can cram into these things because drinking while driving or texting while driving will no longer be an issue.

    The importance of styling will be minimized because the modules in the high-speed trains will have to be blunt at both ends. There will be minimum separation in the train. Air resistance will be minimal because the modules will just be inserted into the train and spat out when you get close to your exit.

    The future of dealers?

    Unfortunately, I think this is the demise of automotive retailing as we know it.

    Think about it: A horse dealer had a stable of horses of all ages, and you would come in and get the horse that suited you. You'd trade in your old horse and take your new horse home.

    Car dealers will continue to exist as a fringe business for people who want personalized modules or who buy reproduction vintage Ferraris or reproduction Formula 3 cars. Automotive sport — using the cars for fun — will survive, just not on public highways. It will survive in country clubs such as Monticello in New York and Autobahn in Joliet, Ill. It will be the well-to-do, to the amazement of all their friends, who still know how to drive and who will teach their kids how to drive. It is going to be an elitist thing, though there might be public tracks, like public golf courses, where you sign up for a certain car and you go over and have fun for a few hours.

    And like racehorse breeders, there will be manufacturers of race cars and sports cars and off-road vehicles. But it will be a cottage industry.

    Yes, there will be dealers for this, but they will be few and far between. People will be unable to drive the car to the dealership, so dealers will probably all be on these motorsports and off-road dude ranches. It is there where people will be able to buy the car, drive it, get it serviced and get it repainted. In the early days, those tracks may be relatively numerous, but they will decline over time.

    So auto retailing will be OK for the next 10, maybe 15 years as the auto companies make autonomous vehicles that still carry the manufacturer's brand and are still on the highway.

    But dealerships are ultimately doomed. And I think Automotive News is doomed. Car and Driver is done; Road & Track is done. They are all facing a finite future. They'll be replaced by a magazine called Battery and Module read by the big fleets.

    The era of the human-driven automobile, its repair facilities, its dealerships, the media surrounding it — all will be gone in 20 years.

    Today's automakers?

    The companies that can move downstream and get into value creation will do OK. But unless they develop superior technical capability, the manufacturers of the modules, the handset providers, if you will, will have their specifications set by the big transportation companies.

    The fleets will say, "We want a module of a certain length, a certain weight and a certain range."

    They will prescribe the mileage and the acceleration and take bids.

    Automakers, if they are smart, may be able to adapt. General Motors sees the handwriting on the wall. It has created Maven and has bought into Cruise Automation and Lyft.

    It doesn't want to be the handset provider. It wants to be the company that creates the value and captures the value, and it is making the right moves to be around when the transition occurs.

    I think probably everybody sees it coming, but no one wants to talk about it. They know they will be OK for a few years if they keep providing superior technology, superior design and have good software for autonomous driving.

    So for a while, the autonomous thing will be captured by the automobile companies. But then it's going to flip, and the value will be captured by the big fleets.

    This transition will be largely complete in 20 years.

    I won't be around to say, "I told you so," though if I do make it to 105, I could no longer drive anyway because driving will be banned. So my timing once again is impeccable.

    RECOMMENDED FOR YOU
    The industry's future reads like a science-fiction novel
    Related Articles
    Why are disruptors dangerous? They aren't protecting a business model.
    Letter
    to the
    Editor

     

     

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    The industry's future reads like a science-fiction novel
    The industry's future reads like a science-fiction novel
    Should automakers leave automaking to others?
    Should automakers leave automaking to others?
    How to make a go of it in mobility
    Sponsored Content: 4D imaging radar
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    See more newsletter options at autonews.com/newsletters.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Digital Edition
    Automotive News 4-19-21
    THIS WEEK'S EDITION
    See our archive
    Fixed Ops Journal
    Fixed Ops Journal 4-12-21
    Read the issue
    See our archive
    Get Free Newsletters

    Sign up and get the best of Automotive News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    Subscribe Now
    Connect With Us
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter

    Our mission

    The Automotive News mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in North America.

    AN-LOGO-BLUE
    Contact Us

    1155 Gratiot Avenue
    Detroit, Michigan
    48207-2997

    (877) 812-1584

    Email us

    Automotive News
    ISSN 0005-1551 (print)
    ISSN 1557-7686 (online)

    Fixed Ops Journal
    ISSN 2576-1064 (print)
    ISSN 2576-1072 (online)

    Resources
    • About us
    • Contact Us
    • Media Kit
    • Subscribe
    • Manage your account
    • Reprints
    • Ad Choices Ad Choices
    • Sitemap
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • HOME
    • NEWS
      • Dealers
        • Access F&I
        • Fixed Ops Journal
        • Marketing
        • Used Cars
        • Retail Technology
        • Sales
        • Best Practices
        • Dealership Buy/Sell
        • NADA
        • NADA Show
      • Automakers & Suppliers
        • Automakers
        • Manufacturing
        • Suppliers
        • Regulations & Safety
        • Executives
        • Talk From The Top
        • Leading Women Network
        • Guide to Economic Development
        • PACE Awards
        • Management Briefing Seminars
        • World Congress
      • News by Brand
        • Aston Martin
        • BMW
          • Mini
          • Rolls-Royce
        • Daimler
          • Mercedes Benz
          • Smart
        • Ford
          • Lincoln
        • General Motors
          • Buick
          • Cadillac
          • Chevrolet
          • GMC
        • Honda
          • Acura
        • Hyundai
          • Genesis
          • Kia
        • Mazda
        • McLaren
        • Mitsubishi
        • Nissan
          • Infiniti
        • Stellantis
          • Alfa Romeo
          • Citroen
          • Chrysler
          • Dodge
          • Ferrari
          • Fiat
          • Jeep
          • Lancia
          • Maserati
          • Opel
          • Peugeot
          • Ram
          • Vauxhall
        • Renault
        • Subaru
        • Suzuki
        • Tata
          • Jaguar
          • Land Rover
        • Tesla
        • Toyota
          • Lexus
        • Volkswagen
          • Audi
          • Bentley
          • Bugatti
          • Lamborghini
          • Porsche
          • Seat
          • Skoda
        • Volvo
        • (Discontinued Brands)
      • Cars & Concepts
        • Virtual reveals (Sponsored)
          • MITSUBISHI: 2022 Outlander
          • NISSAN: 2022 Pathfinder and 2022 Frontier
          • GENESIS: 2021 GV80
          • KIA: 2021 K5
          • LEXUS: 2021 IS
          • NISSAN: 2021 Rogue
          • TOYOTA: 2021 Venza and 2021 Sienna
        • Auto Shows
        • Future Product Pipeline
        • Photo Galleries
        • Car Cutaways
        • Design
      • Final Assembly
      • China
      • Shift
      • Mobility Report
      • Special Reports
      • Digital Edition Archive
      • This Week's Issue
    • OPINION
      • Blogs
      • Cartoons
      • Keith Crain
      • Automotive Views with Jason Stein
      • Columnists
      • China Commentary
      • Editorials
      • Letters to the Editor
      • Send us a Letter
    • DATA CENTER
    • VIDEO
      • AutoNews Now
      • First Shift
      • Special Video Reports
      • Weekend Drive
    • EVENTS & AWARDS
      • Events
        • Congress Conversations
        • Retail Forum: NADA
        • Canada Congress
        • Europe Congress Conversations
        • Fixed Ops Journal Forum
        • Shift: Mobility at a Crossroads
      • Awards
        • 100 Leading Women
        • 40 Under 40 Retail
        • All-Stars
        • Best Dealerships To Work For
          • Register for the 2021 Best Dealership To Work For
        • PACE Program
        • Rising Stars
        • Europe Rising Stars
    • JOBS
    • AN Solutions
    • +MORE
      • Leading Women Network
      • Podcasts
        • Shift: A Podcast About Mobility
        • Special Reports Podcasts
        • Daily Drive Podcasts
      • Webinars
      • In the Driver's Seat
        • AAM
        • Cars.com
        • DealerPolicy
        • Gentex
        • IHS Markit
        • Remember Group
        • Reputation.com
        • Ricardo: Dave Shemmans
        • Ricardo: Marques McCammon
      • Publishing Partners
        • Allstate: Want more from your F&I?
        • Ally: Navigating the future of automotive retailing
        • Amazon Web Services: Any place, any time, any channel
        • Amazon Web Services: The power of the cloud
        • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
        • Capital One Auto: Dealerships remain vital to an increasingly digital car shopping journey
        • DealerSocket: 5 steps to modernizing the buyer's journey
        • Epic Games: Build stunning, real-time car configurators with Unreal Engine
        • Epic Games: Real-time tech is the next frontier of automotive
        • Epic Games: Transforming the auto industry with digital assets
        • FTI Consulting: Crisis as a catalyst for change
        • Google: 5 trends shaping the auto industry's approach to a new normal
        • Google: Google's dealer guidebook helps dealers navigate today's digital landscape
        • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
        • IHS Markit: COVID-19: The future mobility delusion
        • Level5: 2020 Automotive E-Commerce Report
        • Motormindz: Toward hyperconnectivity: 5 ways to position your business to profit from connected car
        • Naked Lime: Bring social reputation together as part of big-picture marketing
        • Ally: Do It Right
      • Classifieds
      • Companies on the Move
      • People on the Move
      • Newsletters
      • Contact Us
      • Media Kit
      • RSS Feeds