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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."
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.
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.
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.
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.
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]
Obama saved the unions at GM and Chrysler. He saved the names GM and Chrysler. He destroyed the bondholders, who by law own the company's assets when it goes bankrupt. He destroyed and continues to destroy the principle of rule by law. He preserved the principle of legally protected union thuggery.
Had GM and Chrysler gone bankrupt, the assets, if they were capable of productive use (which is saying if they were capable of doing more good than harm) would have been sold to organizations capable of running them at a profit. Instead they continue to bleed the economy, disguising losses with money from the government.
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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.
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