Yesterday we published a piece I wrote for Fortune magazine’s next issue, on how Alphabet’s Waymo is—for now, at least—the front runner in self-driving cars. You can read it here, but the gist is that Waymo was able to take a more cautious approach than rivals such as Cruise and Uber, and this seems to be paying off in the form of a steadily-expanding business and a relative lack of regulatory woes.
One thing that I all-too-briefly touched on in the article was the subject of Waymo’s Chinese competitors, which have begun testing their vehicles on American roads—companies like Pony.ai, AutoX, and Apollo (owned by Baidu, China’s answer to Google) that have long been allowed to ply robo-taxi services on limited routes in cities like Shenzhen and Beijing. AutoX and Apollo even have California DMV permission for fully-autonomous “Level 4” tests without a driver present.
So if Waymo’s U.S. rivals are currently stalled or way behind, could the real threat be Chinese? The experts I interviewed for my article certainly aren’t writing off that possibility—though Frederic Bruneteau, of the Ptolemus automotive consultancy, did warn that these companies may have a harder time dealing with the fallout of any crashes in the U.S. than they’ve done in China, where there’s no free press and the authorities may be more tolerant of potential national champions.
But I reckon the Chinese robo-taxi players’ biggest problem in the U.S. will be anti-Chinese sentiment, grounded in national-security concerns. We already saw President Biden order an investigation into Chinese internet-connected cars in February, homing in on the risks of their data collection. That probe is legally underpinned by executive orders from both Biden and his predecessor, Donald Trump. But these orders can be overturned by a future president, so yesterday Rep. Elissa Slotkin (D-Mi.) introduced a bill that would ensure such an investigation can’t be simply dropped.
“We’ve worked with the Commerce Department on this bill to establish a formal national security review of Chinese-made connected vehicles,” Slotkin said. “The legislation would also codify the Department of Commerce’s authority to ban any connected vehicles from the U.S. market if the review makes clear they pose a risk to national security.”
This has implications for the wider U.S. auto market—all new cars are connected these days, and national security is one way to counter an invasion of China’s cheap, popular electric vehicles in particular. But it would really be a big deal for robo-taxi development, and I’m not just talking about companies like AutoX and Apollo. Waymo itself is working with China’s Zeekr (which is owned by Volvo parent Geely, and which listed in New York this month) on a new, steering-wheel-free self-driving car that may supersede the modified Jaguars Waymo currently has on the road.
So stay tuned to see how Slotkin’s bill fares. Meanwhile, there’s another aspect of the Waymo story that I didn’t have space for in my article: the potential for licensing out its Waymo Driver system to traditional automakers.
The likes of Mercedes-Benz and Volvo are selling or preparing to sell cars that can achieve “Level 3” autonomy, meaning the car can monitor and react to its environment on its own—unlike a “Level 2” Tesla, in which the driver is supposed to keep an eye out at all times. But a human driver still needs to be around to take control occasionally. Ford and Volkswagen are also targeting Level 3, despite setbacks over the years. But there are plenty of other car manufacturers that lack the resources to develop self-driving cars on their own.
According to Bruneteau, this—and the fact that Waymo doesn’t present competition in the automaking field—may provide an opportunity for Alphabet’s operation to license its technology. “There could be an invasion from the robo-taxi segment to the high-end and midrange segments of those [automakers] who haven’t been able to sufficiently invest,” he told me. “And today, that’s most of them.”
And a Waymo spokesperson indicated that this is indeed an option, noting that the Waymo Driver could be integrated with everything from ride-hailing vehicles and trucks to personal cars: “By building a driver, not a vehicle, we’re building a system of multiple applications and routes to commercial scale, which means we have multiple routes to huge markets without being locked into a single use case, and that our share of the [autonomous vehicle] market can grow without the costs of vehicle manufacturing.”
More news below.
David Meyer
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NEWSWORTHY
OpenAI and Apple. OpenAI CEO Sam Altman has sealed a deal with Apple to provide AI services in iOS 18, according to The Information, which reports that Microsoft CEO Satya Nadella is worried about the implications for the OpenAI-Microsoft tie-up.
Trump and Musk. Elon Musk could become a White House advisor under a second Donald Trump presidency, according to a Wall Street Journal article that says the men—seemingly enemies a couple years ago—have recently been chatting several times a month. Musk and investor Nelson Peltz have apparently been holding “gatherings of powerful business leaders across the country to try to convince them not to support President Biden’s re-election campaign.”
Google, Amazon, and Airbnb win. The EU’s top court has ruled in favor of Google, Amazon, Airbnb, and Expedia in a case involving Italy’s attempt to force them to submit information about themselves, as well as to pay financial contributions to the Italian state. As Reuters reports, European e-commerce rules say companies that have set up headquarters in one EU country (Ireland for Google and Airbnb; Luxembourg for Amazon; and Spain for Expedia) don’t have to abide by additional obligations placed on them by another EU country where they also provide their services.
ON OUR FEED
“We would caution against making inaccurate assumptions about Search based on out-of-context, outdated, or incomplete information.”
—A Google spokesperson confirms that the massive leak of documentation around Google Search's ranking methods, mentioned in yesterday’s Data Sheet, is real.
IN CASE YOU MISSED IT
A 35-year-old Chinese man has been tagged as the alleged mastermind behind a gargantuan botnet used to steal billions from zombie computers, by the Associated Press
Massive ransomware network taken down by ‘Endgame’ international police operation, by the Associated Press
Apple is getting a once-in-a-decade secret weapon in AI-enabled ‘intelliphones.’ Bank of America sees its stock surging 20%, by Will Daniel
Why SAP’s CTO made scale a strategy for generative AI, by John Kell
Gen AI at work has surged 66% in the UK, but bosses aren’t behind it, by Adam Gale
BEFORE YOU GO
Apple ID. Apple CEO Tim Cook has agreed to incorporate the functionality of Japan’s new My Number ID card into the iPhones sold there, at the request of Prime Minister Fumio Kishida, Japan Today reports. Each Japanese resident gets a My Number, which can be used to interact with social security, tax, and other administrative services in the country. Within the next year, health insurance certificates and driver’s licenses will also be incorporated into the card—and the iPhone, which will be an officially recognized substitute.
