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2016_07_29-D20-versus-Dow-SnP-weekly-percentage-change-since-08_28_2015

Blackberry’s Double-Digit Gain Drives D20

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Led by Blackberry’s (BBRY) and Valeo’s (VLEEY) double-digit percentage gains, the Driverless Transportation (D20) Weekly Stock Index jumped nearly 3 percent, closing the week at 155.17. That’s three weeks in a row the D20 has soundly beat the Dow Industrials and the S&P 500. Both the major indexes had down weeks.

Blackberry’s stock price jumped 10.5 percent on news that it released its second Android-based phone called the DTEK50. Although many in the market continue to plead with Blackberry to get out of the phone handset market, the DTEK50 is actually a step in the right direction. The DTEK50 was designed by Blackberry but it’s the first phone that Blackberry had manufactured by someone else.

One piece of bad news for Blackberry, Apple has hired the former head of Blackberry’s automotive software group and the founder of QNX for its driverless car project. What is this going to mean for Blackberry’s QNX, one of the leaders in the Automotive Operating System Market?

The D20 price loser last week was Ford (F), dropping $1.18, or 8.5 percent, to close the week at $12.66. Ford’s drop was driven by a 3 percent decline in Q2 earnings, a drop unexpected by market analysts.

Visit the Driverless Transportation D20 Stock Index page to learn more about it and its component stocks.

Up and Comers:

Fleet productivity firm Automile raised $6.2 million in a funding round led by Jason Lemkin’s SaaStr Fund. Automile calls itself an IoT company that uses the cloud to help fleets lower fuel consumption, track mileage and increase productivity. Lemkin may be best known for founding electronic signature house EchoSign.

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SAIC and Chinese Internet Retailer Alibaba Unveil ‘Internet Car’

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Jennifer van der Kleut

Chinese Internet retail giant Alibaba-often called the Amazon of China-has unveiled its first car, which they are calling their “Internet car.”

The car, an RX5 sport utility vehicle, was built by China’s biggest automaker, SAIC, and will run on YunOS software developed by Alibaba.

In addition to being able to connect with other devices, the OS’Car RX5 will offer premium alibaba-internet-car-interiorinfotainment features such as finding parking spaces and nearby gas stations, and even making restaurant reservations.

What’s more, multiple passengers will be able to log in to their individual Alibaba accounts to access music, shopping and more.

Industry analysts are already calling the OS’Car RX5 a strong contender when it comes to competing with the likes of Google, Apple and Blackberry, who have been working on infotainment systems like Android Auto, Apple Play and QNX, respectively, for years.

“Smart operating systems become the second engine of cars, while data is the new fuel,” Dr. Wang Jian, chairman of Alibaba’s Technology Steering Committee, said in a statement quoted by Alizila.

“It’s moving from the mobile smart phone connectivity to full-car connectivity to the internet,” said Steven Crumb, executive director of Genivi, an open-source infotainment cooperative, to AFR.com. “Even though you’ve got Google and others working on the autonomous vehicle, the way to get the autonomous vehicle is through the connected car. That’s the stepping stone to get where we are today to fully autonomous.”

The car will reportedly retail for 148,800 yuan, or $22,300 U.S.

 

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In Q1 2016, the Biggest U.S. Demographic Buying Mobile Data Service Was…Cars

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Jennifer van der Kleut

Can you name someone you know who does not own a smartphone? It might be tough. It’s no secret that the U.S. smartphone market is heavily saturated.

When it comes to cellular service and data plans, the biggest piece of the pie when it comes to sales continues to be existing customers-that is, people who are already devoted smart-device customers, but are looking to upgrade to fancier, more high-tech mobile devices with better features, or who are switching providers to get a better deal on their service.

But an interesting new market report indicates that the biggest growth these days is coming from new customers wanting new types of devices-and the most attractive new customer is actually your car, Recode reports.

“In the first quarter, for example, the major carriers actually added more connected cars as new accounts than they did phones,” Recode reported.

In fact, 32 percent of all net-add devices (new devices previously not hooked up to data service) were cars last quarter, indicates industry consultant Chetan Sharma in her U.S. Mobile Market Update report.

Sharma reports that AT&T has been adding the most new connected-car clients, though Verizon remains an undisputed, overall industry leader.

“Verizon’s IoT/Telematics accounted for $195M in Q1 and is likely to cross the $1-billion mark in 2016, making the U.S. the hotbed for ‘Connected Intelligence’ activities, growth, and continued experimentation,” Sharma said.

Sharma reported that Apple dominated the device market in Q1, with a 39-percent share, and Android business rose only slightly, mostly thanks to sales of Samsung devices, while Sony, HTC, LG and some other Android players suffered “deep losses.”

Looking ahead, Sharma predicts the U.S. mobile data traffic to grow by 65 percent in 2016.

Otto self-driving truck

Former Employees From Google, Apple, Tesla Start ‘Otto,’ Develop Equipment for Self-Driving Trucks

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Jennifer van der Kleut

A group of 40 former employees of top-notch firms like Google, Apple, Tesla, Cruise Automation, Nokia’s HERE and others have banded together to form Otto, a company that aims to outfit commercial trucks with equipment that turns them into self-driving vehicles.

Otto is working to develop a hardware kit that, once installed in a freight truck, would enable the vehicle to drive autonomously. The equipment could be purchased and then installed at either a service center, or possible by the truck’s manufacturer if Otto is able to establish manufacture partnerships, reports The Verge.

Two of Otto’s founders-Anthony Levandowski, who led Google’s self-driving car division, and Lior Ron, who led Google Maps-said in a blog post that commercial trucks are ripe with problems and inefficiencies that they believe autonomous driving could help solve.

“…They cause a large number of fatalities, are inefficient and, to top it off, there’s an increasing shortage of drivers. That creates the perfect storm for a tech-based solution, Otto’s founders believe,” TechCrunch reports.

Initially, Otto will focus on highway driving by the trucks they outfit. Drivers will still be responsible for navigating surface streets, and for loading and unloading the trucks as usual.

One thing that is unclear, The Verge explains, is whether the fact that the human in the truck does not have to operate the truck the majority of the time-highway driving makes up the bulk of a commercial truck’s travels-will allow trucking companies to get around laws that minimizes the number of hours trucking employees can work.

“…In theory, an Otto-equipped truck might be able to safely operate for many more hours than a human who is always in full control, but [Lior Ron] says they’ll have to work with regulators to prove that out,” The Verge explained.

TechCrunch reports that Otto initially started out developing driver assistance systems, that aim to make driving a truck more safe. That philosophy carries over into the company’s self-driving equipment.

“…Among many things, they aim to let drivers safely take a sleep break while leaving their truck driving autonomously,” TechCrunch said.

To start with, Otto is testing on Volvo VNL 780 trucks, but The Verge reports that they eventually hope to work with many Class 8 trucks, which are the largest, heaviest trucks on American roads.

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Apple Invests $1 Billion in Didi Chuxing, the ‘Uber’ of China

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Jennifer van der Kleut

Apple made a decision last week that has many industry experts scratching their heads-they announced the company has invested $1 billion in a ride-hailing company called Didi Chuxing, which many call the Uber of China.

It’s an unprecedented move that has left many asking, why?

The Washington Post has two theories.

Firstly, the Post explains that Apple has billions in revenue tied up overseas, and bringing that money back to the U.S.-such as, by investing in an American company-would come with a costly tax bill.

Secondly, we’ve all heard the rumors that Apple is quietly working behind the scenes to nab a piece of the driverless transportation pie. By investing in Didi Chuxing, Apple is looking toward making progress on that goal.

There’s even a third reason. Didi Chuxing has made no secret of their goal of surpassing other countries like the U.S. when it comes to automotive and technological innovation. By partnering up with Didi Chuxing, Apple is joining forces with one of its biggest potential competitors, as China is second only to the U.S. in those industries.

Xinhua Finance Agency reports that Didi Chuxing completed 1.43 billion rides in China in 2015.

The Post also theorizes that Apple’s monumental investment in a Chinese company will help ease tensions with the Chinese government. Just last month, Apple’s iTunes and iBooks stores were shut down across China over regulatory arguments. In addition, sales of Apple iPhones in Asia have declined by at least 26 percent in the past year.

Though Apple has been largely silent as to their reasons behind the $1-billion investment, CEO Tim Cook did tell Reuters, “We are making the investment for a number of strategic reasons, including a chance to learn more about certain segments of the China market.”

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SanDisk Unveils SD Flash Card for Connected Cars

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Jennifer van der Kleut

Here’s one creative way to customize and upgrade your car’s connectivity features-insert one of SanDisk’s new automotive SD flash cards.

SanDisk recently announced the debut of its new product, which the company says will allow advanced driver assist systems (ADAS), better infotainment and 3D mapping, among other features, to be loaded into compatible cars.

SanDisk’s move is being called a strong one by industry experts, as transportation advances are heavily shifting focus from hardware toward software to keep up with the growth of the “Internet of Things (IoT),” reports ZDNet.

Likewise, tech companies previously only known for their Web, phone and email services, like Google and Apple, are now ranking among major auto manufacturers like Ford, General Motors and Mercedes-Benz when it comes to auto innovation.

Richard Robinson, director of Strategy Analytics’ Global Automotive Practice, noted in a statement that “in-car tech is becoming as important as 0-60 and MPG ratings for car manufacturers, if not more so,” reports InfoStor.

SanDisk agrees.

“The ‘Internet of Things’ is the most dynamic force to impact the automotive and industrial markets in a decade, driving exciting new opportunities for connectivity as well as new challenges for how to store, process and manage the data it creates,” Oded Sagee, senior director of connected solutions at SanDisk, told ZDNet.

ZDNet reports that samples of SanDisk’s new automotive SD flash card will be released in March, and that SanDisk has plans to add the automotive card features to its Industrial and Industrial XT SD card products for IoT.

baidu

Could China’s More Relaxed Regulations Push Baidu’s Driverless Car Past Google, Ford and Others?

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Jennifer van der Kleut

When one thinks about driverless car testing these days, names like Google, Ford, GM, Tesla Motors and potentially even Apple instantly come to mind.

But perhaps there’s one other company whose name is escaping you-one that some experts think could possibly even speed right past the others-Baidu.

Baidu is a Chinese company that many don’t realize is already out there, testing driverless cars in varying weather conditions  in different spots around China. And, thanks to China’s more relaxed regulations, some think they could very well leave industry leaders in the dust and get a driverless car to market first.

It certainly seems as though Baidu has the clout to succeed, as the company is valued at around $55 billion.

In addition, Motley Fool reports, “Baidu also has the big ambitions to go with its big size: The company hopes to have driverless cars in 10 Chinese cities within three years. By comparison, Google has been working on the technology since 2009 and only has driverless cars on the road in two cities — Austin, Texas and Mountain View, Calif. Ford has driven a driverless test vehicle at Mcity, a simulated city at the University of Michigan, while GM hopes to begin road testing one on its campus by the end of this year. None of these American companies have taken any steps toward testing in China.”

Motley Fool also points out that the Chinese seem eager to adopt the technology, where most surveys still indicate at least half of Americans remain skeptical of it.

“Baidu is focusing on China, where the market for autonomous vehicles could be nearly as large as North America’s by 2035, according to data from IHS Automotive. Indeed, according to a recent University of Michigan survey, 96 percent of Chinese drivers would be interested in purchasing an autonomous vehicle, compared to only 66 percent in the U.S.”

Plus, regulations in America complicate a move toward autonomous transportation-there is currently no consistent national policy, and a small handful of states have conflicting regulations, while others have no law on the books at all.

By contrast, in China, Motley Fool points out that there is a one-party, “top-down” regulatory system, where local laws are not allowed to contradict national laws.

To its benefit, Baidu has reportedly made several presentations to China’s president on the merits of autonomous and connected vehicle technology.

“Chinese President Xi Jinping reportedly considers autonomous vehicles and digital technology key areas of opportunity for Chinese manufacturers,” Motley Fool reports.

Though historically, China has been a century behind other nations in automotive technology, Baidu’s co-founder and CEO says he is confident Baidu has the technical expertise to reach its autonomous transportation goals.

“Robin Li, Baidu’s co-founder and chief executive officer, has invested heavily into a subfield of artificial intelligence known as deep learning, which aims to improve search results and computing tasks by training computers to work more like the human brain,” Bloomberg Business reports. “[Wang Jing, Baidu’s senior vice-president in charge of its autonomous drive division,] thinks the company can leverage its expertise in artificial intelligence, data mapping and Internet connectivity to excel in autonomous driving technology.”

“Google enjoys a huge lead in autonomy today. But don’t underestimate the Chinese will to compete,” Michael Dunne, president of Dunne Automotive Ltd. in Hong Kong, said to Bloomberg.

Tesla Model S

Tesla Recruits Creator of iPhone’s Processor to Work on Self-Driving Cars, AutoPilot

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Jennifer van der Kleut

Tesla Motors has recruited former Apple engineer Jim Keller to work on its AutoPilot and self-driving car projects.

“Jim Keller is joining Tesla as Vice President of Autopilot Hardware Engineering,” Tesla confirmed to ZDNet. “Jim will bring together the best internal and external hardware technologies to develop the safest, most advanced autopilot systems in the world.”

Keller is famously known as the creator of the A4 and A5 processors that powered most of Apple’s mobile devices, including the iPhone, from 2010 to 2012, ZDNet reports, speculating that Keller will “presumably take a big role at Tesla, under Elon Musk, to develop chips that power AutoPilot.”

AutoPilot is a feature of Tesla’s Model S, which debuted in late 2015. So far, AutoPilot has been plagued with widely-reported problems.

As The Verge reports, within days of the feature’s rollout, users were posting frightening videos on the Internet of how their car performed with the AutoPilot mode engaged. One video showed the car suddenly jerking to the right, almost crashing the car into a bush, as it exited the freeway.

Other videos showed drivers simply making bad decisions including climbing into the backseat and letting the car drive itself, even though Tesla urged users to keep their hands on the wheel at all times, as AutoPilot is still in its “beta” phase.

Perhaps with Keller aboard, Tesla will continue to improve upon AutoPilot, as well as make progress toward fully autonomous cars.

As for its traditional models, however, Tesla continues to encounter obstacles. On Tuesday, several news outlets reported that its efforts to begin selling its cars in Michigan were met with a fight, as Governor Rick Snyder made a move toward changing its laws by a single word, presumably to keep Tesla out.

CNN Money reports Michigan changed its law to specify the word “dealer”-meaning that only dealers can sell cars in the state.

Many say that change was explicitly directed at keeping Tesla out, because Tesla does not sell its cars through dealers, but rather only through Tesla retail stores, cutting out the middle-man and selling cars directly to consumers.

CNN estimates around 400 Michigan residents already own and drive Teslas, which they had to either drive out of state to buy, or had to order online, “sight unseen.”

 

Google self-driving car illustration

Prediction: These 5 Companies Will Dominate the Driverless Industry, Bring Cars to Consumers

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Jennifer van der Kleut

A new report by the firm Juniper Research declares the five companies they believe will dominate the driverless car industry, and bring the first driverless cars to consumers, reports Business Insider.

Though countless companies have declared they will have mass-market driverless cars on public roads sometime between 2019 to 2025, Juniper has announced the five they think will win the race.

The five companies are:

  1. Google
  2. Volvo
  3. Daimler
  4. Tesla
  5. Apple

We at Driverless Transportation track four of these five companies in our exclusive D20 Stock Index.

Some may be surprised to see Apple - the lone company on Juniper’s list that we don’t track on the D20 - anywhere on the list, considering the company has all but denied they are doing any work toward researching and developing autonomous car technology. Countless news outlets have been pointing to signs that Apple is working on it in secret, though, including reports that Apple executives met with California Department of Motor Vehicles officials earlier this year to discuss laws and regulations for driverless vehicles.

Juniper said it handed the number-one spot to Google due to the fact they have been testing driverless cars longer than any other company in the game, and continue to collect mountains of real-time data every day.

Daimler, the parent company of Mercedes-Benz, made headlines earlier this year by driving an autonomous big-rig truck on a public highway. Daimler’s head of development has also publicly declared that the company will be the first to launch autonomous functions in production vehicles, “within this decade.”

Do you agree with Juniper’s predictions? Tell us in the comments.

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Latest KPMG Report: Connectivity More Important Than Horsepower in Cars of the Future

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Jennifer van der Kleut

Luxury, gas mileage and horsepower-features such as those have long been the deciding factors for consumers when picking the car for them.

The latest report from research/consulting firm KPMG says those features are starting to move toward the back burner, though-and that the future is all about connectivity.

According to KPMG, processing capability and connectivity will be more important than horsepower in the cars of the future.

In the report, KPMG analysts go so far as to theorize that technology is completely taking over auto innovations, and that within a decade, automakers will no longer exist as independent companies, implying that OEMs will join together with tech companies like Apple and Google to continue manufacturing cars, or perhaps tech companies will even even acquire car companies.

Mobility-on-demand (such as ridesharing apps like Uber and Lyft) and autonomous cars are two areas of auto innovation that KPMG says are experiencing the biggest push right now-largely by tech companies.

In short, KPMG’s report says that tech companies, not car companies, are the ones most focused currently on what consumers really want, and that is why they are poised to take over automakers.

In addition, KPMG says companies like Apple-perhaps best known for its smartphones these days-are more accustomed to high levels of production, cranking out hundreds of millions of units each time a new product comes out, in comparison to automakers’ mere millions.

“Maybe automakers should start thinking about behaving like phone companies,” comments columnist Patrick Nelson of Network World.