Marchionne says FCA isn't just bashing metal for Google

Jamie Butters
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Fiat Chrysler Automobiles NV is an active partner with Alphabet Inc.’s Google to marry self-driving car technology with the automaker’s plug-in hybrid minivan, FCA Chief Executive Officer Sergio Marchionne said.

The carmaker plans to develop about 100 self-driving prototypes based on the Chrysler Pacifica hybrid-powered minivanthat will be used by Google to test its self-driving technology, the companies said Tuesday. It’s too soon to answer questions such as who will own the data collected by the cars or how to divide the spoils, he said.

Fiat Chrysler employees aren’t serving just as “metal bashers,” he said at the minivan factory in Windsor, Ontario. Engineers from the two companies are working together to incorporate Google’s autonomous-car technology into the minivan, he said Friday. But where the partnership — and the auto industry — go from here remains to be seen, Marchionne said.

“We know what we do well: We know how to build cars and we know how to introduce relevant technology in these vehicles,” he said. “But we’re also open-minded.”

The factory, which produces a minivan about every 45 seconds, will start making the plug-in hybrids in the second half of the year. It could make Google’s vans sooner, but Marchionne said that will be decided by the relevant teams.

The accord marks Google’s first agreement to work directly with an automaker to integrate its self-driving system since the technology giant began developing autonomously operated cars on its own in 2014. Fiat Chrysler Chairman John Elkann said last month that the auto industryshould work with “new industry participants”like Google and Apple Inc. rather than trying to compete with them. Marchionne said on Friday that cooperating with tech giants is the best way to navigate the potentially profound changes in the auto industry.

It’s Coming’

Marchionne, who rode in Google-controlled cars near its California headquarters, said the robot driver’s skills have improved over the last several months so the experience no longer is unsettling. Long-distance trucking has more immediate commercial benefits for the technology, he said, but the capabilities will soon be sufficient for consumers — assuming regulators allow it.

“I see this having tremendous use in real life,” he said. “It’s not pie in the sky, it’s coming. ”

Fiat Chrysler “is now potentially in front” of competitors following investors’ criticism that it was lagging behind the industry in autonomous driving, said Massimo Vecchio, an analyst at Mediobanca SpA in Milan.

Marchionne, who mentioned a possible partnership with Google in December, has been directly involved in talks with the U.S. company, people familiar with the matter have said. The two companies will remain free to cooperate in driverless technology with other partners, people familiar with the matter said.

Other Partners

Google, which has run more than 1.4 million miles of tests on its own driverless prototypes, has been in discussions with various auto manufacturers about working together. A deal with General Motors Co. couldn’t be concluded because of disagreements over ownership of technology and data, a person familiar with the matter said in April.

Setting up a partnership with Google is in line with Marchionne’s approach to development. He contends that carmakers waste capital developing multiple versions of the same technology and that the industry should consolidate to become more profitable. He intends to put Fiat Chrysler in a better position for a merger by the time he steps down as the manufacturer’s CEO in 2018.

Google needs more cars to develop and test its autonomous technology, but doesn’t want to invest in factories to build them. The joint project meanwhile offers Fiat Chrysler a window into new technology and helps the company prepare for a time when self-driving cars may be a big part of the transportation business, said Maryann Keller, an independent auto-industry consultant in Stamford, Connecticut.

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