Disruption, Old and New, with GM's Steve Kiefer
Speaking to a roomful of automotive analysts before the Detroit Auto Show last week, GM's Steve Kiefer gave a very of-the-moment word, "disruption," some historical reach. In 1908, he said, Cadillac founder Henry Leland was so upset that the hand-crank engine on a car backfired and killed a man (the crank slapped the man in the face) that Leland “really pushed to put the electric starter motor into place."
“This company has been innovating and disrupting for over 100 years,” said Kiefer, in case anyone might think that the Google self-driving project, with its no accidents in a million miles and counting, invented automotive safety.
With the introduction of the electric starter motor, “all of a sudden the automobile became accessible to everyone,” said Kiefer, who since 2013 has led GM's global purchasing and supply chain. “Women started driving and the car was exponentially more accessible. Mobility increased, and this in that time frame was clearly a disruptor.”
Whether intentional or not, Kiefer's language around an accessible utopia isn't all that different from Google's Chris Urmson's in a TED talk last yea. Urmson spoke of a day when blind and physically disabled people will be able to pilot self-driving cars. Was Kiefer insinuating that GM is not only just as innovative, but has been for a lot longer?
In any case, Kiefer continued the history lesson: In 1966, GM engineered the first hydrogen fuel cell electric vehicle, and just a few years later “GM would traverse the moon” with navigation and guidance technology in the Apollo moon mission and the mobility systems in the Lunar Roving Vehicle. In 1996, GM pioneered the EV, the predecessor to the Volt, and two weeks ago the 2017 all-electric Bolt, which won the Best of the Consumer Electronics Show for automotive technology two weeks ago.
It's not surprising that Kiefer would take the long view. An engineer with a master’s in business administration, he spent 20 years at Delphi before migrating to General Motors in 2013 to lead its global powertrain operations. But he also steered things forward in his talk, speaking of a future with increased urbanization and more car-sharing since cars “sit idle more than 95% of the time.”
“Transformation requires a major change in the way we work and partner in our industry, and I’m pleased General Motors is in the thick of it,” he said.
Ten years ago, Kiefer said, tech startups like Lyft and Uber “didn’t really exist or certainly weren’t operating in our automotive space. Each of these companies primarily exist due to increases in connectivity, or the way information is exchanged in between vehicles or with the cloud. And these companies are really disrupting our industry.”
He assured the crowd that “GM has seen this coming and is prepared for this. Some of you remember when GM introduced OnStar in 1996, in the Cadillac. The concept was really unconventional. And much like the starter motor, I don’t think anyone can anticipate the change it would have on the industry.”
No stranger to connectivity, GM, he said, has had more than one billion interactions on OnStar and owns more than 500 patents related to it and similar technology. “I think we’re really in the position where we can own the intellectual property in this connectivity space,” he said.
“Imagine the kind of things you can do with this technology once you start to use it,” he added. “Improved data sharing, car sharing, warranty management and predictive maintenance are some of the things we’re doing. And it gets better, if you look at our integrated 4G LTE hardware, which is helping expand what General Motors can provide to all our customers.”
Kiefer expects that the 4 million connected GM vehicles in North America will triple by the end of 2016, when all GM vehicles will have 4G LTE as an option.
He said GM plans to take its partnership with MobileEye, which makes the navigation cameras used in cars across the industry, a step further by combining their technology with GM’s Onstar and 4G LTE data to “allow real-time crowd-sharing data to develop low-res maps.
“How are we going to commercialize that? Wait and see because I don’t think all the answers are there yet. But imagine having 12 million cameras searching the roads of the world and populating it with data” to be used for autonomous, safety and convenience features.
Of GM’s new $500 million partnership with ride-sharing company Lyft, Kiefer said that “the investment is going to allow us to further the development of autonomous vehicle activities,” while providing for a shorter-term income stream by filling Lyft rental hubs with GM vehicles.
To the suppliers in the room, he advised, “look at our vision, our history, look where we’re going, look at our product portfolio. You need to be bringing all your innovation to GM. You need to be having us as your OEM of choice, first on the list.
“I’ve started talking [with suppliers] much less about terms and conditions and material costs, and much more about safe, defect-free vehicles.”
He said that the purchasing and engineering divisions at GM are trying to cooperate more closely than before, “to be the company that’s the easiest to work with bringing innovation to the market.
“We’re not there yet, I know, but we’re working hard at it.”
