A kind of progress: the future of America’s car dream

My grandmother came from Kansas. She was born in the spacious, agrarian west of the state in 1937, then – whilst still a teenager – married my grandfather and settled in the almost-as-spacious, suburban east of the state. Like many Midwesterners, she was rarely happier than when on the road, at the wheel of her car. She used to caress the leather of the steering wheel with her thumbs as she drove, moving them back and forth in an affectionate stroking motion. It was a subconscious tic I’m sure, but a deeply symbolic one – a sign of just how important her car was to her.

Her attachment to the shining hulk of metal in the driveway went far deeper than the functional role it played in her life. Holidays frequently involved driving more than a thousand miles to one coast or other – and then back again. She’d drive from the middle of America almost up to the Canadian border, or almost down to the Mexican, to visit her children who’d settled in Minnesota and Texas respectively. If she could have driven, rather than flown, from Kansas to London to visit the furthest flung of her progeny – the part of the family I belong to – I think she would have done. I never heard her grumble once about these gruelling car journeys. The reason for that is simple: she loved them.

From the fragments I know about my grandparents’ relationship, I think it’s fair to say that the car was where they had most of the truly important conversations of their married life. It was where they both felt most at ease and so, while marital rows took place at home, the making up and figuring out how to piece things back together almost always happened on the road.

After my grandfather died in 2009, it left an unfillable void in my grandmother’s life. At that point, her car took on an almost spiritual role. It was where she went to be alone with her memories of him. It was her private chapel on wheels.

***

While some aspects of this story are deeply personal, in many ways my grandmother was representative of most Americans of her generation. Cars have long been tied up with Americans’ – and America’s – sense of identity, particularly for the generation that came of age in the 1950s. For individuals, they became must-have status symbols; for the nation, they became the embodiment of the American Dream.

There’s an irony in the fact that cars have become associated with an individualistic political outlook. The state has always played a vital role in the development of America’s car culture. The 1956 Federal Aid Highway Act – the legislation which led to the creation of the Interstate Highway System – was more significant than anything produced by Ford, Chevrolet or Buick during the 1950s in cementing America’s relationship with cars. At the time, it was the biggest infrastructure project in US history and it was based on an entirely car-centric vision of the future.

eisenhower_federal highways act

A pivotal moment for America’s car dream: President Eisenhower signs the Federal Aid Highway Act in 1956

America’s cities and suburbs developed the way they did at least in part because state regulators created strict rules about the number of parking places developers needed to provide. Those same zoning regulations that shaped American suburbs after the war are now under attack from a new generation of city planners, who see high-density, public transit-orientated development as the key to revitalizing areas that have become moribund. Millennials aren’t so sure they want to put cars at the centre of their lives in the way that their parents and grandparents did. Even some Baby Boomers entering retirement are wondering whether they could find better ways to spend the $8,700 a year the American Automobile Association estimates it costs to own a car. In 2014, public transit ridership in the US reached its highest level since 1956, the same year President Eisenhower signed the Highway Act.

The automobile industry crash of 2008 may have been precipitated by a deadly combination of financial panic, a sudden freeze on credit and sky-high oil prices, but what’s happened since 2008 suggests the American car industry has more fundamental problems. In 2014, the US Government’s Troubled Asset Relief Program (TARP) effectively came to an end with its sale of its remaining shares in Ally Financial – formerly GMAC, the finance arm of General Motors.

TARP covered both the financial and the automobile industries. The money lent to car manufacturers pales into insignificance compared with the money lent to financial services firms. The whole automobile industry received less than half the $182 billion that the insurance firm AIG alone received. But that’s only act one of the bailout story. When the federal government sold its final shares in AIG in December 2012, it had not only recouped its investment in full but made a tidy profit of more than $22 billion. On TARP as a whole, the government actually came out more than $15 billion ahead. But on the portion of its investment that went specifically to the automobile industry, it lost almost $10 billion. The financial industry has bounced back remarkably strongly since 2008; the car industry has not.

***

The American Dream has always had critics keen to burst the bubble of the country’s roseate self-image. For them too, cars have been an important symbol. The climax of F. Scott Fitzgerald’s iconic 1925 novel, The Great Gatsby, is a fatal car crash. The plot revolves around the complicated love square involving the married couple Tom and Daisy and their respective lovers Myrtle and Gatsby. After a confrontation in New York City, Tom sends his wife back to Long Island with Gatsby in the latter’s extravagant yellow car. On the way, they pass the garage owned by Myrtle’s husband, Mr. Wilson. A tragically timed marital row sends Myrtle running out into the street, just in time to be hit by Gatsby’s car. The car, which up to that point in the story has been a symbol of Gatsby’s wealth and status, suddenly becomes emblematic of decay and death – both Myrtle’s and ultimately Gatsby’s (Wilson is able to track down and shoot Gatsby based on the fact that he recognizes the car that killed his wife).

gatsby car

Leonardo di Caprio as Jay Gatsby next to his car in the 2013 film version of The Great Gatsby

There are echoes of Gatsby in Tom Wolfe’s 1987 novel, The Bonfire of the Vanities. It too revolves around a hit-and-run accident. Bond trader Sherman McCoy accidentally finds himself lost in the Bronx with his mistress Maria Ruskin in his $48,000 Mercedes. With the road that re-joins the highway blocked by rubbish bins and a tire, McCoy gets out of the vehicle to clear the way. When two black youths approach, both McCoy and Ruskin panic. He jumps back in the car while she drives away, but the car fishtails and hits one of the youths.

Almost thirty years on, Bonfire remains a very recognizable story of an urban society that’s deeply divided by race, politics and wealth inequality – a society where the Sherman McCoys do their best to insulate themselves from the fractious world around them.

But they can’t.

Much as he might wish he could simply return to the safety of his Park Avenue-Wall Street bubble where he is a “master of the universe”, once the wheels have been set in motion, McCoy can’t escape being sucked into the vortex of the city’s omnipresent political battles over race and class.

The moral of the story is that the boundary between public and private spheres is more permeable than we imagine. In this respect, Bonfire harks back to liberal economist John Kenneth Galbraith’s depiction of “the affluent society” in his 1958 book of the same name, in which he drew attention to the juxtaposition between “private affluence” and “public squalor” that Americans had come to accept as normal. Nowhere is this juxtaposition and the interdependency between the two spheres more apparent than on the country’s inner-city roads. When he finds himself on the squalid, neglected roads of the Bronx, Sherman McCoy’s $48,000 Mercedes can’t protect him from the world outside. In fact, it does the opposite: it makes him more of a target.

***

Needless to say, most Americans have been unperturbed by these warnings about the American Dream. Gatsby and McCoy remain archetypes of a life of wealth and success that many aspire to. And that’s not going to change any time soon. But the place of cars in this story might be about to alter dramatically.

Last summer I was in Silicon Valley with the top management of a leading European car manufacturer. They’d chosen Silicon Valley as the location for their annual management offsite so that they could check out some of the “new competition”. As one of the firm’s senior executives said to me: “if you’d told us five years ago that we’d be worrying about Google and Apple as competitors, we’d have laughed you out of the room.” Now they’re not laughing any more.

At Dublin’s Web Summit in November, Bill Ford, great-grandson of Henry Ford, and current executive chairman of the company his great-grandfather founded, summed up the predicament carmakers face today: “if you think of this industry, we’ve been revolution-resistant for 100 years. We used to talk about autonomous driving as 25 to 30 years away. Well no, it’s not. The pace of change is always going to come at us much faster than we thought.”

A combination of three separate but overlapping waves of innovation – autonomous driving, electric vehicles and the sharing economy – looks set to truly up-end not only the auto industry but the very nature of Americans’ relationship with their cars over the next decade. The company at the nexus of this triple revolution is Uber.

File illustration picture showing the logo of car-sharing service app Uber on a smartphone next to the picture of an official German taxi sign

Uber didn’t even exist when the automobile industry crisis hit in 2008. Today it’s valued at more than $50 billion and the number seems to leap by another $10 billion every few months, as though, in the real-life Monopoly game that Uber CEO Travis Kalanick is playing, that’s the amount you collect each time you pass go. In October 2015, there was speculation that the company’s next capital raise could see its value rise to £60 billion or even $70 billion. To put these numbers in context, Ford is worth about $60 billion, while General Motors is worth about $55 billion. Nobody’s suggesting they might add an extra $10 billion to their value at any minute.

In December 2014, Uber announced that it had reached the threshold of 1 million trips a day. Although the company had never previously released figures for the volume of rides it was enabling every day, leaked documents from November 2013 suggest that, at that stage, it was doing about 120,000 trips a day. That means the figure grew by more than eight times during 2014. So who knows what the actual figure is today.

The company’s geographic reach continues to expand at a similarly staggering pace. Not so long ago, few people outside of the Bay Area had even heard of Uber. But, as of late last year, the company claims that they cover more than half the US population.

Disruption is an over-used word in contemporary corporate speak and Silicon Valley is notorious for hyperbole. But with Uber, the hype seems more justified than usual. The company’s long-term goal is to make both driving and car ownership obsolete. That’s what makes it the most feared of the new competitors.

Slightly bizarrely, the man who coined the term “disruptive innovation”, Professor Clayton Christensen, argues in the December 2015 issue of Harvard Business Review that Uber isn’t truly disruptive. I have two objections to Christensen’s argument. The first is that he talks about Uber purely in the context of the taxi industry and fails to see it as a disruptor to the wider car industry. This is oddly myopic since the very same article holds up the launch of the iPhone in 2007 as a legitimate example of disruption, not in the smartphone market, but because it undermined the laptop’s dominance as the primary means of connecting to the internet. It seems like an obvious parallel for what Uber is threatening to do to the auto industry today. My second objection is that Christensen seems to have decided that, on the basis that he wrote bestselling book twenty years ago, he now owns exclusive rights to the D-word and therefore anyone who uses it to describe something that doesn’t fit within the narrow constraints of his particular theory of “disruptive innovation” is a linguistic interloper.

But I digress.

Uber attracted some negative headlines in 2015 as well. Taxi drivers around the world have gone on strike to protest the way Uber is eating their lunch, though they’ve garnered limited sympathy from customers fed up with high prices and grumpy service. More troublingly, Uber drivers in several countries have assaulted passengers, which has triggered uncomfortable questions for the company about whether it’s taking adequate measures to vet its drivers. The company has also been criticized (and sued) for the fact that it considers its drivers to be independent contractors rather than employees, thereby dodging an enormous bill for employee benefits.

But these look like little more than transitional challenges as Uber’s unstoppable rise continues. It’s working on a once-and-for-all solution to the pesky fact that its drivers are its biggest liability. Though it’s garnered less attention for doing so than Google – whose prototype driverless cars have racked up more than 1.2 million miles on Bay Area roads – Uber is also investing in driverless technology in a big way.

Two related questions occur about Uber’s vision of a future without drivers or car owners or gas guzzlers: is it realistic? And is it desirable? The Silicon Valley crew would have us believe that progress towards it is unstoppable. And this is hardly surprising, coming from a group of people who see the world largely in terms of technological challenges and solutions. The hard work on the technology is done. Certainly there are still significant improvements to the technology to be made – currently Google’s prototypes are limited to a speed of 25 miles per hour – but these are incremental changes.

The unknowable piece of the equation, it turns out, isn’t the technology, but the humans. The two biggest hurdles left for those who want to see a driverless future are, firstly, overcoming people’s emotional attachment to driving and their instinctive distrust of ceding control to computers; and secondly, navigating a transition period when driverless cars must share the road with unpredictable humans. The latter is the issue currently vexing some of the best minds in America across a variety of disciplines – from artificial intelligence to ethics. How should a driverless car make decisions about what to do in a situation where a collision is inevitable? And how can driverless cars – which are programmed to avoid risks and follow rules – avoid being taken advantage of by aggressive human drivers? These are now the key questions for proponents of the driverless revolution to crack.

According to Ray Kurzweil, a director of engineering at Google and one of Silicon Valley’s most famous gurus, computer intelligence will catch up with human intelligence in 2029. I’m not sure how he came up with that prediction – it seems that if you’re as famous as Kurzweil, you don’t need to offer any reasoning for your predictions – but, if true, perhaps the driverless revolution is a bit further off than Kurzweil’s colleagues at Google claim it is (they’ve said they expect driverless cars to be ubiquitous by 2020). Until computers can outsmart humans, the experience of riding in a driverless car on a road shared with real drivers is likely to be somewhat painful: you’ll be stuck as the most cautious driver on the road, constantly slamming on the brakes while every aggressive petrol-head cuts in front of you.

So we’re not quite on the brink of a transport revolution yet, but there are three compelling reasons to stay the course. The first is an economic one. Uber’s vision of a future where we don’t own or drive cars will help address the current underutilization of these assets and free up precious time for more productive uses. Even in America, where people spend more time at the wheel than almost anywhere else on the planet, the average private vehicle is in use less than 10 percent of the time. In Uber’s version of the future, that number will trend towards 100, with your robotic chauffeur picking up another passenger as soon as it’s dropped you off.

Naturally, this higher utilization rate means we will need fewer cars. Nobody’s yet sure exactly how many fewer, but a 2014 paper by a group of researchers from MIT and the Singapore-MIT Alliance in Research and Technology looked at Singapore as a test case and concluded that, in a driverless future, the island would require approximately one-third the number of vehicles it currently has. That’s the statistic that really makes Bill Ford and co gulp.

In terms of productivity – the bane of most developed economies today – the impending driverless revolution promises to free up several previously wasted hours a week for the average American. Time spent in the car will become another opportunity to do some work, answer your emails or shop online. In short, more time to do your bit for GDP.

Designers at Mercedes-Benz are already busy trying to figure out what it is we will want to do whilst on the road when we no longer have to pay any attention to driving. “Anyone who focuses solely on the technology has not yet grasped how autonomous driving will change our society,” says Dr Dieter Zetsche, Chairman of Daimler AG, Mercedes’ parent company. “The car is growing beyond its role as a mere means of transport and will ultimately become a mobile living space.”

At the company’s research centre in Sunnyvale, California you can see a prototype self-driving luxury vehicle. Aesthetically, it’s a far cry from the pod-like Google cars that you see pootling round the neighbourhood. The exterior of Mercedes’ driverless car appears to have been inspired by the Batmobile, whereas Google’s designers seem to have gone for more of a Popemobile look.

But it’s the interior of the Mercedes F 015 Luxury in Motion vehicle that’s really interesting. It contains four rotating lounge chairs, allowing passengers to face in and talk to each other. It’s equipped with just about every digital gimmick you can imagine. My personal favourite is that you can choose to block out the outside world and have an alternative virtual driving experience. So instead of being stuck in commuter traffic on the M25, you can be transported to a mountain pass through the Swiss Alps, a cobbled street in Rome or a desert track in the Australian Outback. Only the driving-obsessed designers at Mercedes could have come up with that as a credible option for how we might choose to use our newly free time in the car.

mercedes driverless car

Mercedes’ prototype luxury self-driving car: more Batmobile than Popemobile

The second reason to welcome this transport revolution is an environmental one. Today, the transportation sector is responsible for 22% of global greenhouse gas emissions. But the trajectory is towards lighter weight, more fuel efficient (and, in some cases, fully electric) vehicles. And, if the MIT researchers are right, dramatically fewer cars on the road overall. If we can get there before some of today’s emerging markets mature into an American-style system of excessive car ownership with an American-style preference for environmentally disastrous gas-guzzlers, it could be a game-changer for the fight against climate change.

Perhaps the most compelling reason of all to welcome the driverless revolution is safety. According to the World Health Organization, a staggering 1.25 million people are killed on the roads every year. That makes road accidents the ninth most common cause of death worldwide. In America alone, cars killed 34,000 people in 2013, which is actually significantly down from a few years previous: in 2007, it was more than 42,000. That means cars kill more people than guns in America today, despite the fact there are more guns in private hands than cars.

At last year’s Exponential Finance conference in New York (it was at the same event in 2014 that Ray Kurzweil made his prediction about computer intelligence catching up with humans in 2029), Salim Ismail, another of Silicon Valley’s gurus, told a story: “a few years ago when there was a BlackBerry text message outage in Abu Dhabi for a few days, accidents dropped by 40 percent. In a couple of decades we will look back and say ‘Why did we ever let humans drive?’”

Why indeed?

***

On my way home from San Francisco last summer I stopped off in Kansas to visit my grandmother. She was fascinated by my tales of driverless cars, Mercedes-designed mobile living rooms and the rest. Shortly after I left for home, she emailed me an animated video of a flying car, asking how I thought my friends in the auto industry would respond to this. It was the last time I ever heard from her.

Two weeks later she was killed in a car accident. She was on her way to lunch, driving down a quiet country road that she had probably driven thousands of times before. According to local news reports, the other vehicle was going so fast that at an elevated railroad crossing it became airborne and the driver, a 25-year-old woman, lost control and collided head-on with my grandmother’s Buick. She was dead by the time anyone else reached the scene.

When my grandmother was born in 1937, there were about 25 million private cars in America. When she died it was more than 250 million. She truly was a member of the car generation: a generation for whom cars were the pre-eminent symbol of all that is good – and much of what is bad – about the American Dream. It went further than symbolism though. My grandmother’s car was her confessional, her marriage counsellor, her holiday home, her chapel and, ultimately, her coffin.

But now the sands are shifting and the very same forces of free enterprise and libertarian politics that once seemed inextricably tied to the ideal of owning and driving your own car are making that system obsolete. The American Dream will renew itself, but its symbols are changing.

Car accidents were central to the plots of the greatest New York novels of the 1920s and 1980s. I predict that when the successor to Scott Fitzgerald and Wolfe comes to write the definitive New York novel of the 2040s, it won’t involve a car crash. And that, at least, will be a kind of progress.

Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

2 Responses to A kind of progress: the future of America’s car dream

  1. Natalia Miteva says:

    absolutely lovely blog article!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s