Various reports surfaced last week that stated Apple was looking to acquire a robo-taxi startup called Drive.ai. Drive.ai is developing a self-driving shuttle service and has raised $77 million thus far.
While Apple has not confirmed this acquisition, purchasing a company like this, that has technology patents, and a team of engineers just focused on self-driving cars, would be a very interesting move by them. They recently laid off 200 from their Project Titan autonomous driving group and adding this type of engineering talent to bolster this project could be highly strategic for them as they continue to research what Apple could eventually bring to this very nascent market.
While we still really have no clue what the end goal of Project Titan is actually about, but an acquisition of a company that was working on a shuttle service could give us a hint.
In the world of autonomous driving, there are five levels of autonomy:
Over the last year, I have had high-level discussions with folks at Ford and GM, and both have told me that they believe it will be well into the mid-2020s before they would sell self-driving autos to customers. Even that date may be a stretch given people having decades of being in complete control of their vehicles and being willing to trust technology to take over their driving experience completely.
Ford and GM will start by adding level 1 level 2 features to their autos over the next two-three years, which are good first steps towards fully automated driving. From a technology standpoint, Tesla, Waymo and some automakers believe they can deliver fully automated vehicles by 2021, but convincing the public to adopt self-driving cars for themselves will take a lot longer.
In talks with the Ford and GM, both have suggested that the first market they see developing for self-driving cars will be in the area of level 5 taxi or shuttle type services. Although there are still much to be done to perfect level 5 vehicles, many who are working in this area think that this will be the way the public is introduced to autonomous driving and will be an important step that needs to be taken before they sell level 5 cars to the public.
The basic idea behind this would be to deliver an Uber or Lyft like service where a self-driving car will come to your location on demand and take you to your destination. Uber and Lyft are already preparing for this type of service in the future. The auto dealers see this as a good opportunity to create a totally new business that would augment their current gas and hybrid business that they expect to have for at least another 15 years if not more. This would also help them develop the acceptance of self-driving vehicles and brand loyalty for the time when they can sell self-driving cars to customers directly. It can also serve as an important new business model for them should many of their customers decide not to buy any vehicle in the future and just rely on automated vehicles to provide on-demand shuttle and taxi services.
I was told by a source close to the auto industry that we could see the automakers start buying property in different parts of any region in the US and around the world in which they could keep these cars parked, and have large charging stations to keep them powered. They would then be able to provide an on-call taxi or shuttle service to people who need to get from point A to Point B.
Apple’s potential acquisition of Drive.ai likely acknowledges the fact that self -driving shuttle and taxi services could be the first major step in bringing automated vehicles to the public.
I am not convinced at this time that Apple is doing their own self-driving vehicles, and instead of developing technologies that could be crucial for automakers and others to use in their own programs.
Given Apple’s business model, an automated vehicle will most likely be another node to deliver Apple apps and services. Yes, they could provide fundamental technology like maps, AI-based navigation, AI-based cameras, and specialty sensors needed for level 5 driving automation.
But imagine if you get into a Robo-Taxi and can personalize and customize the audio, video and Communications experience for your drive. If people are not driving, they will want something to do during the drive time.
In fact, if Apple is involved with the fundamental design of these level 5 cars, they could build in Wifi and Bluetooth systems and have video screens in each seat. When a person gets into an Apple equipped car, it automatically connects to an iPhone and makes it possible to view TV shows, movies, listen to your music and make video calls. One of the virtues of a self-driving car is that you are not driving it. Given you have downtime, you could fill it with Apple based services that make Apple even more valuable to you.
I find project Titan to be one of Apple’s more fascinating research projects and buying a company focused on shuttle or taxi services could make a lot of sense for Apple should they want to play in the autonomous vehicle’s future.