Trends: These alternative automakers could be game changers
Story by John LeBlanc
The car, truck or SUV you currently drive is more than likely powered by a fossil-fueled internal combustion engine, purchased or leased at your local dealer, and manufactured by an American, Japanese or German company with a history of building cars that goes back well into the last century. But there are a handful of 21st-century “alternative” automakers that are thumbing their noses at the traditional way automobiles have been designed, built and sold, creating personal transportation solutions that could revolutionize our over-century-old relationship with the car.
If you haven’t been in the market to buy a new vehicle in the past few years, it’s understandable if you don’t associate firms like Apple, Google and Tesla — let alone even lesser-known companies like Faraday Future or Atieva — as competitors to established auto industry behemoths like General Motors, Toyota or Volkswagen. Yet this rising generation of alternative automakers has plans to offer new vehicles to the buying (or leasing or sharing) public in the next few years, and they’re already having an immediate impact on old-school automakers. And compared to those traditional companies, these automakers really are “new.”
Germany’s Mercedes-Benz lays claim to being the oldest automaker in the world, with founder Karl Benz’s self-propelled vehicles first going on sale in 1888. America’s Henry Ford started up in 1903. However, the first of the “new” automakers, California’s Tesla Motors, only started selling its original Roadsters in 2008.
Of the above-mentioned outlier automakers, Canadians more than likely know a fair bit about Tesla. Created by serial entrepreneur Elon Musk, Tesla followed up its Roadster (the world’s first all-electric sports car) with its Tesla Model S electric luxury sedan in 2012 and just recently launched its third model, the Model X electric crossover.
With its low-volume production of only electric vehicles, California location (Palo Alto), small workforce (about 12,000 employees, compared to the VW Group’s almost 600,000) and direct sales model (there are no Tesla franchise dealers) – with a non-automotive background (founder Musk also oversees commercial rocket maker SpaceX) – Tesla is arguably the template for any ground-breaking automaker.
And in just a few years, you may be chauffeured to work by your self-driving Google Car. While established automakers such as Audi, BMW and Mercedes-Benz are also working to put self-driving cars on the market, Google – the California-based technology company founded a century after Benz’s first car, and best known for its Internet services – has been working on autonomous vehicles since 2009, with the intention of making an electric Google Car available to the public in 2020.
Rival Silicon Valley tech giant Apple has not officially announced its intentions to become an automaker, but a series of rumours and facts strongly point in that direction.
After aggressively hiring employees from established automakers like Ford, GM, Volkswagen and Tesla (many with experience in electric cars and autonomous driving), the “Apple Car” has moved to a “committed project” status with 2019 as a potential on-sale date, according to a recent report from The Wall Street Journal.
Another California “underdog” automaker, first thought to be a front for the Apple Car, is California-based Faraday Future. Backed by the owner of Leshi Television (think of it as a Chinese Netflix), Faraday has made more of a public commitment to making cars than either Apple or Google.z
In the past few weeks, Faraday has announced that it will unveil an electric car concept (penned by a former BMW electric car designer) at the Consumer Electronics Show in Las Vegas this January, with plans to build a US$1 billion factory in a Las Vegas industrial park with the goal of producing vehicles in 2017.
Also joining the newbie automaker ranks, most recently, is Atieva. Like Faraday, Atieva is Chinese-backed (by one of China’s largest automakers, state-owned Beijing Automotive Industry Corporation), is California-based and will build electric cars only. A Tesla Model S-like teaser sketch has been released of a concept to debut at next April’s Beijing auto show.
As much as the idea of walking into your local Apple store and driving away with an Apple iCar, or ordering up an autonomous Google Car to chauffeur you to the grocery store, seems like a dream come true for millions of consumers that already engage with these technological giants on a daily basis, the fact remains these aspiring automakers face a David versus Goliath scenario on the sales charts.
Today, only Tesla is selling vehicles to the public. And with North American sales nearing 21,000 copies sold for the first 10 months of 2015, the electric car maker is far away from replacing giants like GM, which recorded sales of over 3 million in the same period.
But that doesn’t mean new car buyers shouldn’t be paying attention to these outlier companies. Underdog automakers are having an immediate influence on the current automotive industry.
Many Tesla Model S buyers are trading in their Mercedes-Benz and BMW luxury sedans. And that trend has not gone unnoticed in Detroit or Bavaria. Almost every major automaker has an electric “Tesla Fighter” in the works. The most blatant is the Porsche Mission E Concept from this year’s Frankfurt auto show, confirmed to go on sale by 2020 – while Ford just announced plans to invest US$4.5 billion to add 13 electric cars and hybrids to its lineup by 2020.
The other area that the new generation of automakers is affecting is the old guard definition of car ownership.
To make their vehicles more accessible, the idea of car sharing, leasing or partial car ownership is a pillar of next-generation automakers. The first Google Cars will likely be shared, more like self-driving taxis. Faraday sees its vehicles as smartphones on wheels, with plans to offer subscriptions for applications and infotainment sent directly to the car.
Perhaps the biggest proof these rebel automakers will affect the next new car you buy — even if the vehicle comes from a Ford, Chevrolet or Porsche dealer — is the brain drain from traditional automotive centres like Michigan and southern Germany to the American West Coast. The demand to marry old-school manufacturers with California’s high-tech community has created a Detroit West, with the majority of traditional automakers setting up shops in Silicon Valley.
Don’t worry. In the short term, traditional buyers will still be able to go to a local Ford dealer and get a new V8-powered F-150. In the long term, though, making a few swipes on a smartphone and having a self-driving electric car take you to your destination, as you get caught up on your favourite TV show along the way, is an automotive trend many of the newest automakers are hoping becomes a reality sooner than later.