How Your Life Changes as Biden Spends $1 Trillion on Computers on Wheels
Entrepreneurial opportunities abound as electric vehicles transform our world.
Bill Gates famously said, “Most people overestimate what they can do in one year and underestimate what they can do in ten years.” This is where electric vehicles are today.
They've arrived
In 2020, Tesla sold almost 500,000 electric vehicles, while GM sold 2,500,000 vehicles of all kinds. Ponder that for a moment. Tesla sold 20% as many vehicles as GM, and all of Tesla’s were electric.
It can’t be much clearer that the age of electric vehicles has arrived. It’s so clear to GM that they have committed to being all-electric by 2035. Earlier I observed that GM has significant assets at its disposal to make its all electric future a reality that Tesla will find hard to replicate. Despite Teslas’ stratospheric stock market valuation, we’re in the very early rounds of this fight.
There is unattainable hype about electric vehicles. GM promises, “Zero Crashes, Zero Emissions, Zero Congestion.” The cars may be zero emissions, but the electricity has to be produced somewhere. If electric vehicles operate on existing public roads, they’ll be part of the congestion there. If they obey all traffic laws in order to have zero crashes, they will take forever to get anywhere on crowded roads with cars driven by humans who cheat at the margins of traffic laws to get where they want to go faster.
All that said, GM committing to an all electric future is a powerful signal that the age of electric vehicles has arrived. Not only does GM see the success of an upstart like Tesla, but they can read the political tea leaves to see the tsunami coming.
The supercharger event
The era of big government is back and the Biden administration is committing over $1 trillion to drive the adoption of electric vehicles. For starters, Biden plans to spend at least $400 billion to replace the Federal government fleet with electric vehicles made in the USA. In addition, he’d like to see 500,000 school buses converted to electric by the end of the decade. He wants to have a network of 500,000 charging stations across the country. $300 billion will be invested into R&D spanning from lightweight materials to batteries, 5G, and artificial intelligence. Biden plans on spending $2 trillion on US infrastructure, much of it dedicated to electric vehicles. While only a few all-electric vehicle models are being made today, this can be the electric vehicle equivalent of the COVID vaccine’s Operation Warp Speed.
Profoundly different
A large percentage of a fossil fuel powered vehicle’s space and its shape are dictated by the design around an internal combustion engine and the transmission of power from the engine to the wheels.
Some aspects of electric vehicles are similar, from braking systems to safety systems, like air bags and seat belts.
Fundamentally, though, electric vehicles are profoundly different computers on wheels, more like skateboards than cars. Electric vehicles can morph into shapes and functions that aren’t possible with gas or diesel vehicles.
Not only does the electric vehicle shape change, but how it interfaces with other vehicles and with the infrastructure around it is different. Improved safety is an obvious feature of a highly interconnected transportation system.
Commercial applications
Vehicles can also be used in different ways, for example, trains of commercial trucks linked electronically, but not physically, to transport large volumes of goods on highways to a location, similar to how trains on rails operate today.
I live a few exits from the largest BMW manufacturing plant in the world and a few hours from the deepwater port in Charleston. Autonomous truck trains may carry parts from the port to the plant in one direction and assembled cars from the plant back to the port.
21st century autonomous community
Imagine a community where residents live, work and play in housing, offices, restaurants, and retail accessed with on-demand, autonomous vehicles.
An employee living in the community uses her smartphone to call an autonomous taxi the size of a SmartCar to take her to work in the morning and then back home in the evening. Once home, she orders a meal from a restaurant delivered to her home by an autonomous delivery vehicle about the size of a lawnmower. On a girl's night out she takes an autonomous taxi to and from dinner and the theatre without having to park. If she enjoys a couple of glasses of wine with dinner, she safely returns home because she isn’t driving.
Innovation required
Realizing this vision of an autonomous, electric transportation system requires lots of innovation at three levels.
- Vehicles. The design of electric, autonomous cars, trucks, and drones in novel shapes and uses.
- Logistics. The digitization of transportation and logistics systems, such as Amazon, UPS, and Uber.
- Manufacturing. The digitization of smart manufacturing important to the entire automotive, trucking, and aerospace production supply chains.
Each of these levels requires three types of innovation.
- Technical. The autonomous vehicles and the systems that support them must safely and effectively operate.
- Regulatory. Autonomous vehicles must be allowed to operate. At first, this is likely to occur on routes dedicated to autonomous vehicles. Once the technology and safety are validated, regulations must be amended to allow autonomous vehicles on public streets with human-driven vehicles.
- Economic. Business models must support an autonomous vehicle ecosystem. Pay-per-use and subscription-to-use funding models may evolve paid for by users or perhaps by employers. Other revenue streams are possible.
More to come
This only scratches the surface of the huge entrepreneurial opportunities that abound at multiple levels, which I’ll explore in future articles.
