“Electrification, ride hailing, tariff wars, smart cities, micromobility, connectivity, income inequality, autonomy, etc. — an unprecedented, torrential storm for the auto industry. How can we make sense of this? That’s the question I asked myself during the energizing sabbatical I took after three years as an executive at Ford.
“Well, it turns out that this torrent is not unprecedented at all; it’s just unprecedented for the auto industry. Today’s storm resembles ones that have occurred every 50 years or so, transforming the entire economy and changing the way we live: a ‘habit-breaking hurricane,’ according to economist Carlota Perez. Those hurricanes were the Industrial Revolution, the steam age, the age of steel and electricity, the mass-production age. Today, we are in the eye of a storm called the digital technological revolution.
“Digital technologies, from chips to AI, have finally become powerful enough to transform the car into something entirely new: an electric, connected, intelligent device. Creating these devices is catalyzing a convergence of the auto industry with the telecom (connected), technology (intelligent) and energy (electric) industries. The history of technological revolutions suggests an entirely new industry will emerge from this Venn diagram. Maybe we will call it the mobility industry.
“A profitable future for auto companies in this revolution requires a dual transformation: optimizing the core business, which pays the bills, while building the new business, which is the future. Dual transformations are underway all around us.
“Think Disney and streaming, Walmart and Jet, Amazon and Whole Foods, GM and Cruise, Ford and Argo AI.
“The COVID crisis will very likely intensify the hurricane, enabling leaders to accelerate their transformations and forcing followers into each others arms, or worse, out of business.”