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Howes: Tech, environment reshaping old auto assumptions

Daniel Howes
The Detroit News

Here in the home of the American auto industry, folks claim an innate sense of how the business works:

Gasoline engines power large(r) vehicles produced on traditional assembly lines staffed with real people. Their cars and, increasingly, trucks are driven by other real people — not suites of computers, sensors and cameras programmed to observe traffic laws with annoying precision.

The Cruise Autonomous Vehicle (AV) is General Motors driverless car built without a steering wheel or pedals is on display on the main floor of the Renaissance Center on Wednesday.

And diesel engines belong in one of two places: history or the roads and highways of western Europe. There, regulators and powerful agricultural lobbies shaped policy to favor diesels into a revenue machine for Germany’s Big Three automakers.

Until now, the graveyard of old assumptions. General Motors Co. CEO Mary Barra is fond of saying the auto industry will change more in the next five years than it has in the past 50. How she’d reckon the past week in that prediction is anyone’s guess, but it would absolutely support her thesis.

Consider two recent snapshots showing radical departures from the automotive orthodoxy that shaped generations of industry folks living and working in company towns like Detroit and Stuttgart, Munich and Wolfsburg, home to Volkswagen AG.

First data point: Germany’s Federal Administrative Court this week delivered another crushing blow to diesel engines, empowering cities to ban them from some streets to lessen air pollution. The move promises to radically reshape Germany’s powerhouse automakers, to upset one of the principal ways they earn profits, and to impact regional economies and jobs.

Industrially speaking, that’s akin to Washington regulators enabling U.S. cities to ban large pickups and SUVs, the mother’s milk of Detroit’s automakers, because they consume too much fuel or foul too much air.

Germany’s move is hugely consequential in the beating heart of the premium auto industry. It’s also a searing indictment of the diesel lies peddled most egregiously by Volkswagen AG’s “clean diesel” canard and the corporate deception discovered and confirmed by American investigators.

The chief beneficiary of VW’s hubris is a growing environmental consciousness across Europe demanding action. By essentially targeting diesels for elimination, the British, the French and now the Germans — the three largest consumer markets on the western half of the continent — are challenging the decades-long hegemony of their auto industries.

Rapidly advancing technology will supply further traction, thanks to the evolving reality of Auto 2.0. In their purest imagining, autonomous vehicles powered by zero-emissions electric powertrains represent a trifecta for European policy-makers: clean personal transportation that theoretically reduces congestion, improves air quality and reduces accidents.

Second data point: Regulators in California are moving to allow automakers and their tech rivals to remove safety drivers from autonomous vehicles plying the state’s roads. Take note, skeptics: you may be disinclined to ride in, much less own, an autonomous vehicle, but it’s not about you in Middle American suburbs.

It’s about lots of customers whose money is just as good — Indians in Mumbai, Chinese in Shanghai and Guangzhou, car-less residents of Washington, San Francisco and New York who need short rides in dense traffic to get to work, the market or the gym and home again.

Lawmakers and regulators in Sacramento and Lansing, Washington and other state capitals are moving to enable autonomous driving because technology is realizing the vision. Not next year, maybe, but sooner in some markets than the old assumptions may be willing to contemplate.

Booming sales of American trucks and SUVs won’t change these unmistakable trends. An auto industry built on steel, rubber and gasoline is being transformed by electricity, digital technology and environmental pressures that governments are corralling to force change.

Your father’s auto industry — built over the past century of investment, wartime, decline and revival — is facing a shift of historic proportions. It’s blurring the line separating manufacturing from technology, and it’s not going to stop.

(313) 222-2106

Daniel Howes’ column runs Tuesdays, Thursdays and Fridays. Follow him on Twitter @DanielHowes_TDN, listen to his Saturday podcasts, or catch him at 3 and 10 p.m. Thursdays on Michigan Radio’s “Stateside,” 91.7 FM.