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Why Silicon Valley Won't Be the Green Car Detroit
thecarchik writes "NPR boldly pronounced, 'The new automobile of the 21st century is likely to benefit from the culture of Silicon Valley, where people are used to taking a chip, a cell or an idea and working on it until it becomes something big.' We've thought about it for a year, and discussed it with many people. And we don't believe it. Silicon Valley is the wrong place to build an auto industry, for three main reasons."
Too many liberals. And I am not even trolling...
Obama likes poor people so much, he wants to make more of them.
why would they be expected to build anything else? they'll build the specs and engineer the processes and ship it off to china... business as usual.
That's reason number one. That's the last place I'd want to build an industry, not just because of me but also my workers would have to deal with the heavy tax burden.
Better someplace that has few taxes & doesn't steal (much) money from the workers' paychecks. Like one of the Carolinas.
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>>>Feedback on this comment system?
Yeah it sucks. And it's slow (CPU intensive). And I can't get back to the classic (plain text) index even though I've un-checked and checked it multiple times.
"I disapprove of what you say, but I will defend to the death your right to say it." - historian Evelyn Beatrice Hall
Come build your car manufacturing plants in Canada, eh? Our workers don't ask for $100 per hour salaries and we got all four seasons* to test your technologies too!
* warning: the summer-to-winter ratio imay not be uniform.
Are they kidding? Silicon Valley already doesn't do a lot of it's hardcore manufacturing. Neither does Detroit anymore.
It's a globalized world out there now. There's no good reason that the Valley can't be the R&D center for even conventional cars. Nevermind bleeding edge EV cars. They just might not build them in California.
An electric car would be no different from an iPod in this respect.
A Pirate and a Puritan look the same on a balance sheet.
The same problems exist in the energy domain as well. California has steadily been making the state hostile to actual manufacturing, the technical domains (bioengineering, mechanical engineering, materials science) are only superficially relevant to Silicon Valley's prime skill set (microlithography, electrical engineering), and the business model is way off (what? There's no exit strategy? You mean we have to actually OPERATE THIS THING OVER THE LONG HAUL?).
Dog is my co-pilot.
Although it makes some concessions to the idea, the article ultimately struggles around the idea that where things are prototyped/engineered isn't necessarily where they will be built.
And I agree, Silicon Valley is a terrible place to build a manufacturing plant. Cost of living is too expensive and you can't reasonably expect to pay factory workers wages that will allow them to compete for housing with programmers and engineers.
However, the article makes an awful case that engineering around green cars can't/won't happen in Silicon Valley. They point out that Tesla has to work to attract the kind of specialized engineers they need to move out there. But you know what? The point is, you can convince them to move out there. It might cost you, but you can do it if it's important enough. Good luck convincing the best and the brightest that they want to live in Detroit instead, despite a much cheaper cost of living.
From the article:
Long cycles, faraway profits
Wrong kind of engineers
Painful place to build things
"Who is the Journal of Quantum Physics going to believe?" --Stephen Hawking
I agree with many of the points made in the article. The one point that got my attention (and then got me thinking) was "These days, it takes $1 billion or more to design, engineer, test, certify, and launch a brand-new vehicle. And that takes roughly five years." My point is that I am eagerly looking forward to the time I can buy a car online with a build specification similar to the options I am offered when I visit Dell's or some other company's website. How long before we get PnP components for cars like we do with computer components? Car manufacturing will generate more business when we have more adaptable parts that can be ordered, created and delivered within two weeks of visiting Ford's website.
Is this thing on?
Forget Cali, come to Central Oklahoma! Our GM plant closed last year; the facility and knowledgeable manpower are available. Decently low cost of living, decently high wages, right-to-work (not that I'm anti-union). Plenty of inexpensive power (natural gas-fired electrical plants) and good weather. Heck, we even have earthquakes.
Chaos maximizes locally around me.
Like the fine print on Apple and other hi tech company product packaging tells us: Designed in California. Made in [not California].
Regarding the electric cars companies currently in California. Maybe some cars will be built in California while the company is still in a start up and "prototyping" mode (this can be years after starting to sell to early adopters). However when the company matures and the company perspective evolves from development to manufacturing the factories will move out of state. Especially if viable competitors appear.
Silicon Valley may be a hub for design but other parts of the country have far more expertise in nuts-and-bolts manufacturing. The components of a car may be incredibly hi tech but auto manufacturing will largely remain bolting and welding components together.
1. Bulk. A car is big, shipping is expensive.
2. If your part isn't at the assembly plant when it is needed and GM has to shut down the line, your company gets charged about $2000 per minute (might be more, now). With "Just in Time" inventory practices, no supplier would be willing to risk a long transport time.
3. Logistics (related to 2) When I worked for an auto supplier, orders were finalized no more than 3 weeks out. When I worked for the paper products company, product from China was shipped 3-6 months out.
--
JimFive
Please stop using the word theory when you mean hypothesis.
Slashdot has posted several articles from greencarreports.com (all submitted by thecarchik), many of which have been pretty poor, including the one about cambered tires improving efficiency while completely neglecting the fact that it ruins handling, a study showing that hyrid cars don't save enough gas to cover extra cost by conveniently only looking at the first 5 year of the cars use.
I've added them to my ignored links list.
TFA is saying that one of the reasons the valley won't manufacture cars is because they'll have to import engineers from elsewhere since the ones already in the place are only qualified in microelectronics and aren't qualified in the heavy duty engineering needed for manufacturing.
Silicon Valley's already full of imported engineers who were brought in to work as coders. I'm one of them. I don't see why they couldn't import the necessary skills. The valley is a very attractive proposition to someone living in India, or in England as was the case for me.
Drill baby drill - on Mars
The 100 MPG X-Prize winner is in Lynchburg, VA. So no, not Silicon Valley.
http://hardware.slashdot.org/story/10/09/16/1811257/Meet-the-Virginia-Built-110MPG-X-Prize-Car
http://www.pbs.org/newshour/rundown/2010/09/ultra-light-cars-reap-rewards-of-x-prize.html
Tesla has the advantage of taking over the NUMMI plant in Fremont, CA, a big, successful auto plant shut down for the 2008 recession, when Toyota, for the first time, had to close plants. They're only using a fraction of the plant, but they own all the buildings (although not all the land; they didn't buy all the parking lots). There are plenty of laid-off auto workers living nearby, so a workforce is available.
The cost differential with China has narrowed. It turns out that once wages in China reach a quarter of the US level, China manufacturing stops being competitive. The transport costs, the delays, and the quality problems make outsourcing manufacturing less attractive. With wages rising in the coastal provinces in China, (and wages dropping in the US) that wage level has been reached in some industries.
Also, with all the foreclosures, bay area house prices have dropped. Maybe by a factor of 2.
Operating in Detroit has its own problems. The weather is harsh. Crime is high. Most of the people with competence and ambition moved out when the jobs did.
Don't worry about the rare earth supply problem. Mountain Pass, California is already coming back on line.
One of the big advantages Silicon Valley has enjoyed is it's proximity to Asia. And likely it's one of the reasons why Silicon Valley is where it is. They enjoy easier access to the high technology coming out of Japan, South Korea and Taiwan and the manufacturing resources of China.
The automotive industry is an entirely different beast. The technology isn't nearly as concentrated as it might be with computers or consumer electronics. A company could draw on manufacturing, expertise and technology from Europe, Asia and within the United States. So why even bother putting up with the high taxes and regulations present in California? The company could be based anywhere.
And building a car, especially a green car, is a far more complex undertaking than a lot of people seem to realize. I expect we're going to see a lot of investors burned in ventures that end up not working out. Even Tesla, which has gotten far further than most is struggled. Too many start ups have impractical pie-in-the-sky ambitions. Unrealistically lightweight vehicles with amazing fuel economy that manage, by magic, to meet all crash-worthiness requirements. And they simply don't have the resources to build aerodynamic bodies cheaply and efficiently. I expect that in the end it's going to be the major automakers who will bring practical green cars to the market.
The big limiting factor is the battery. If someone manages to produce batteries that store far more energy and can be charged quickly it would revolutionize the automotive industry. We wouldn't need hundreds of pounds worth of batteries or hybrid drivetrains and we'd still get a practical 300+ mile range out of these cars.
"Painful place to build things". Silicon Valley is a very expensive, over-regulated place to do business. The only advantage it holds for current business is the critical mass of engineers that make it easy to cannibalize talent from other companies. Electric vehicle companies would likely adopt a model similar to Apple, wherein design work is done in-house in the Silicon Valley, but manufacturing is done in Taiwan or China. Also, the high efficiency vehicles of the future won't be 4-wheel cars; the safety standards for motorcycles are far less restrictive than those for automobiles, and any 3-wheel vehicle can be classified as a motorcycle. There are also several full electric motorcycles coming out now (e.g. Zero Motors).
The "It takes $1 billion and 5 years to launch a new vehicle" is simply bullshit. It make take that long if you do it the way Detroit does it, but history has shown that Detroit is doing it wrong! Modern businesses are no longer the huge vertically integrated monopolies of the early industrial age; it is now possible to buy everything from out of house. "Wrong kind of engineers" is also bullshit -- create a demand for automotive engineers and Stanford and Berkly will train them! Granted, there is a 4-year lag, but the reason there is a Silicon Valley in the first place is because the world-class universities in the area created a pool of world-class engineers. Again, having engineers that are trained to do things "the GM way" is a disadvantage, not an advantage.
I've abandoned my search for truth; now I'm just looking for some useful delusions.
Are they kidding? Silicon Valley already doesn't do a lot of it's hardcore manufacturing. Neither does Detroit anymore.
Detroit doesn't do manufacturing? That would be news to those of us who live in Detroit. Despite all its problems, Detroit still is the beating heart of manufacturing in the US. EVERY automobile company has a presence in Detroit. Every major auto supplier has a presence in Detroit, many headquartered here. There is still heaping gobs of manufacturing jobs throughout Michigan even despite the recent problems. Major defense contractors like General Dynamics as well as lots of biomedical engineering goes on in Detroit. It's also one of the top 5 finance hubs in the US.
Silicon Valley won't be the Detroit of green cars because Detroit will be almost certainly be the Detroit of green cars. Little known fact: Detroit metro has the FOURTH highest amount of high tech employment in the US. Detroit already has huge expertise in building cars, existing infrastructure, tons of engineering talent, idle manufacturing capacity and a work force in need of employment. Michigan is investing huge into battery manufacturing. Silicon Valley will get involved to be sure - especially in the electronics that are going to be an ever more important part of the vehicles. Not to say things are roses in Michigan; they aren't but anyone who thinks Michigan is out of the manufacturing business doesn't understand manufacturing.
There's no good reason that the Valley can't be the R&D center for even conventional cars.
Sure there is. The engineering talent and the companies that need it already live elsewhere. Moving to Silicon Valley would require uprooting a lot of existing investments, people to relocate to a place with no particular advantages in technologies specific to automobiles besides electronics and software. There is auto R&D that occurs in California already but Silicon Valley isn't remotely the only place with engineering talent in the US. Could it happen? Sure. Likely? Very very doubtful.
An electric car would be no different from an iPod in this respect.
Right, because building iPods makes Apple/HP/etc perfectly suited to get into the auto manufacturing business. No difference whatsoever... [/sarcasm]
But I doubt that it will be Detroit. Texas and other states without the UAW controlling the governments will get the majority of new factories.
See my blog http://ilovecookes.blogspot.com/ for light hearted technical information.
Operating in Detroit has its own problems. The weather is harsh. Crime is high. Most of the people with competence and ambition moved out when the jobs did.
Bullshit. The weather is fine unless you are a huge sissy and in case you didn't know, manufacturing occurs indoors. The workforce and engineering talent ALREADY lives here. Crime is not particularly high in most of Michigan. Since you are obviously ignorant about how things work in Detroit, most of the manufacturing does not take place in high crime areas. Very few companies actually make anything in Detroit proper - everyone moved out to the suburbs LONG ago. Oakland County (the one immediately to the north of Detroit proper) is one of the wealthiest counties in the entire country and one of only 10 or so with a AAA credit rating.
The dumbest comment though is the last one you made. No one with any competence in Detroit? Spoken like an ignorant jackass who doesn't actually know anything about Detroit or what goes on there. Michigan has the 4th highest amount of high tech employment of any major metro area in the US. The place is absolutely crawling with engineering talent. Might not be as glamorous as microchips and software but make no mistake that there are a LOT of very smart people in Michigan.
These days, it takes $1 billion or more to design, engineer, test, certify, and launch a brand-new vehicle. And that takes roughly five years.
How long do you think it takes to make a missile or satellite ? It's something silicon valley has been doing for year. If you want a more mainstream example, how long do you think it takes to make a cell phone from scratch? It's not just a bunch of desks and a few smart coders. It takes industrial design to go through iterations of the device, radio designers to simulate many iterations, and finally it has to be tested by government(s) and by carriers before the phone is finally able to ship. 2 years for this is considered "speed of light", if you have to redesign late in the process it can stretch out further.
The Kindle took 4 years to develop in secret before it was released, and it's not a very complicated product. There are plenty of businesses in the valley that know that hardware is a long term investment, and that you have to put up a whole lot of capital to make it happen.
“Common sense is not so common.” — Voltaire
"Silicon Valley may be a hub for design but other parts of the country have far more expertise in nuts-and-bolts manufacturing."
Lower wages, low energy costs, low cost of living, and no unions make South Carolina competitive. BMW didn't locate here by mistake, nor did Boeing.
Price yourself out of the market and the market will adapt.
"This post is an artistic work of fiction and falsehood. Only a fool would take anything posted here as fact."
Nice polemic, and echoed widely. On the other hand, California leads the entire US by "value added by manufacturing" and on its own dwarfs the entirety of the Southern states the authors hold up as an example. For example, according to the US Census Bureau, California created $254bln in added manufacturing value with 1.3 million workers in 2008, South Carolina: $37bln with 230000 workers. If you crunch the numbers, you'll also see that California produces more value per worker than most other states. And until the meltdown last year, one of the primary car factories in the US was Nuumi in Fremont, CA, actually the Toyota plant Tesla bought.
Yes, once prices come down and everyone can do it, it'll probably electric car manufacturing will probably move to other states and California will get started on the next thing. But to get this off the ground initially, Silicon Valley is a great spot, because all the expertise you need to debug the process is within a two hour drive.
And by the way, Porsche, Mercedes, Audi, and BMW main factories are in Germany's most expensive areas, very few are in the more depressed parts (although Wolfsburg is really depressing).
Obama did save the US auto-industry, despite republican efforts to kill it, whether he gets any credit for it or not. However, Americans and in particular the auto makers in Detroit will need to make the most of their last chance to survive. This has less to do with politics than with a a willingness and wisdom to adopt a progressive mindset that isn't afraid to change with the times. This piece was all fluff, with no real substantiation or analysis of any of the claims that "the more things change the more they stay the same" (see the closing line [in French]). Seems as if its become popular to believe that competition only requires adopting conservative philosophies and borrowing money from foreigners is all that is needed to stay competitive, with no need to put in the effort to make the changes or investments in education and infrastructure to stay in the game.
Tesla is partnering with Toyota and everyone knows that Toyota does know something about electric vehicles and does have deep pockets, if for no other reason that US taxpayers give them an indirect advantage by being so deeply in debt that their appreciating currency is worth more and more. Hence, they can buy more cheaply (from their perspective) to invest in joint ventures with Tesla and others. For geographic reasons alone, California would be an excellent location for Toyota to expand in the US, since they already have manufacturing plants in the southeastern US. Say what you will about California's progressive politics, but they have a far better educated workforce (assuming Meg Whtiman isn't successful in her promise to dismantle the University System) that is much better able to adapt and utilize to the new technologies that are the future of the auto industry, lots of electronics and experimentation with light-weight composite materials. Like anything else in life, you get what you pay for and for that better quality work force and higher standard of living for workers, one pays a bit more, yes. However, the piece makes the error in thinking that means it won't be cost effective. So long as they can use these advantages California offers to innovate faster than their competition and increase their productivity relative to their competitors, which these days is all about industrial robotics production, rather than reemploying armies of less-than high tech factory workers to do the same job, they will do just fine. Off-shoring jobs with minimal assembly and manufacturing in the US has been and continues be to the preferred republican approach to drive corporate profits, but this is rapidly reaching a point of limited returns, since ultimately it robs American consumers of buying power, the primary reason we now see so few jobs. Likewise, the notion that you will need big steel plants close by is yesterday's thinking, which is what is expressed in this PR piece, and why, if Detroit doesn't get its act together soon, it won't be much of a player in the automotive business going forward.
There will be a big shift from a petroleum based automotive industry to an electricity based automotive industry. The only real question is who will be the one to make the money.
Asia is way out ahead of the US in these technologies and it is unclear if America will ever again be a dominant player in the automotive industry, especially in a US auto industry that is unwilling or unable to keep up with technological progress and unable to break the lock and interconnecting web of entanglements with the oil industry. Consequently, California is well positioned with both its high tech base and forward looking industries, compared to Detroit. Likewise, it has lots of nearly free sunshine and wind and its citizenry is busy making use of it to get off their addiction to foreign oil.
Frankly, this piece displays a rather ignorant smugness of conservative status-quo thinking that Detroit and America can't afford to have, if they want to stay competitive. Sure, the politics of big oil and PR will keep Detroit in the game for some time to com
Tesla happened in SV because the rest of the country doesn't have the start-up mentality. Better to do your design work here and then manufacture elsewhere. Going to Detroit is a mistake - old ways of doing things and lack of vision are pretty ingrained - look at the Volt.
Huh? Leads the world in manufacture of what? Go talk to the few Bay Area machine shops still left standing and ask them about manufacturing of high tech equipment. Go talk to a chip maker like Parallax and ask them their opinion on setting up fab in California. Wasn't there just an article on /. about how movies are being made anywhere except California? Heck, they're moving completely out of the U.S. altogether. You really think New Zealand is home to so many huge-budget films just because Peter Jackson was born there? You really think a movie exec signing a $100 million check cares where some dude was born? There are very few companies actually coding software here in the U.S., even California. My landlord got let go from his 20+ years at the IBM Almaden research center to get replaced by Indians, in India.
I am doing things for California. I own a small business and I'm not giving up on it. I help out when I can with candidates I feel are genuine, like John Dennis up in San Francisco. I am hoping to be working with several volunteer groups on real reforms for the state's utterly failed legislature. But I have to admit, the state is only worth so much money to me. If things keep going the way they are going, I will move elsewhere, probably Austin.
It is my opinion that your ignorance and holding on to victories of the past and refusing to face the brutal facts of reality are more damaging to this state than almost anything else. We are in crisis, and the worst is yet to come.
I once took an excursion to Reddit, and later HN. Unlimited up/down voting sucks when dealing with a hive-mind.
The article says:
Wrong kind of engineers ...
Silicon Valley may have proficient coders oozing out of every condo complex, but it lacks--and isn't likely to develop--large numbers of engineers with the right mix of automotive mechatronics and high-voltage systems skills.
But it misses a point: Silicon Valley has the wrong kind of PROGRAMMERS, too. In particular, the valley's levels of software reliability and bug density are far too poor.
I started my programming career in Southeastern Michigan, and spent 15 of the first 20 years of it in the auto industry, so I know whereof I speak. ANY bit of software written for the auto industry is almost certainly life-critical. Some examples, from my own experience (mainly keeping the nightmare scenarios from happening):
- A bug in the idle speed control results in a line of cars that tends to stall after a car length or two when accelerating from a stop sign.
- A bug in the airbag testing software fires a proof-sample airbag while the worker is leaning over it on the test fixture (rather than after he's out of the chamber, the doors are closed, and the alarm has sounded for the required time).
- A bug in the plant energy management system blacks out all the lights in the factory while the workers are interacting with the still-operating machinery.
- A bug in the alarm system doesn't signal when the "flame curtain" over one end of the annealing oven fails. With no warning the plant soon fills (starting near the ceiling) with hot, carbon-monixide laden, "reducing atmosphere" gas, poisoning hundreds of workers before reaching lower-explosive-limit at an ignition source and blowing acres of roof into the next county.
And so on.
When I moved to Silicon valley I was ASTOUNDED at the low level of software reliability here. Design-for-reliability and even debugging subordinated to "feature velocity". Product shipped with hundreds, or thousands, of bugs. Business models that MONETIZED bugs - by selling contracts to fix them (creating the incentive to ship them for fixing later). And so on. (And open source isn't a cure for this: While it doesn't ship until the original programmer or team is happy with it, it mostly gets its reliability by accelerating the fixes, not by annealing the code into crystalline perfection BEFORE it first ships.)
Ship a bug in a car's software and you incur the cost of a RECALL.
At the first place I worked here in the valley one of my colleagues said I was the only guy he'd trust to program his pacemaker. Another said "["Rod"] takes three times as long to write code - but his stuff usually works the first time." (Which is not true: When you do it right - which involves getting the bugs out right away - you can code and debug blazingly fast. I would only deliver when something was finished to my satisfaction - after hundreds of debugging iterations. But my delivery of a completed project would be compared to single iterations of the others' debugging.)
Thus I gravitated (back) to "the hard side of the force" - moving into chip design. (It's of comparable complexity to a large application these days. And it's about the only function in the valley where Detroit-level reliability is valued: Eliminating a silicon spin is about equivalent to eliminating a recall in cost to the company, but it shows up in time-to-market savings.)
So while there are some other programmers like me available here, an auto company attempting to staff-up in Silicon Valley won't be looking for the sort of programmer that constitutes the bulk of the Valley's programming culture. (They'll do well to hire from "back home" in the rust belt or people transplanted from there, hardware designers, or programmers of medical, telecom, or MIL products.) Worse, the middle-managers here who administer the programmers are steeped in - actually the creators of - this software-unreliability culture. If the new auto company's personnel execs don't figure this out in time you can imagine the debacle when the product hits market - or the delays and cost during the delicate venture-funded stage as they try to retrofit quality into their firmware - or rip it out and replace it.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
Plenty of space, plenty of people, plenty of talent, strong work ethic principles from both the Mormons and the Mexicans, plenty of rail access and roads for transport....
It's called The Beehive State for a very good reason. Build outside of the liquefaction zones and you're golden.
In a world of the blind, the one-eyed man is king--and the two-eyed man is a heretic.
East Bay:
Lawrence Livermore National Laboratory - Livermore, CA
Aero Precision Industries - Livermore, CA
Peregrine Falcon Corporation - Pleasanton, CA
Alameda Aerospace - Alameda, CA
Erg Materials & Aerospace Corporation - Berkeley, CA
Ocellus Inc - Livermore, CA
Inspace Systems - Oakland, CA
Braxton Technologies - Pleasanton, CA
General Dynamics Corporation - San Leandro, CA
Pennisula:
L 3 Communications - San Carlos, CA
Peninsula Avionics, LLC - Mountain View, CA
Northrop Grumman - Oakland & San Francisco, CA
Ideal Aerosmith, Inc - Menlo Park, CA
South Bay:
Space Systems/Loral - Palo Alta, CA
Honeywell International - Fremont, CA
Santa Cruz:
Lockheed Martin Space Systems - Boulder Creek, CA
The article mentions England/UK twice:
"Executives confirmed that the company recruits literally all over the world for engineers with the right mix of experience, including from England’s ample supply of Formula 1 race-car engineers."
"The company developed its groundbreaking Roadster smartly, by adapting and reusing large portions of an existing car—the Lotus Elise sports car—and outsourcing much of that work to Lotus itself, along with the manufacturing (in the U.K.)."
Perhaps the "green car Detroit" won't even be in the USA.
Any state that has a law that requires me to join a Union if I want a certain job is controlled by the union.
See my blog http://ilovecookes.blogspot.com/ for light hearted technical information.