GM (GM): A Car That Will Drive Itself, But No One Will Buy

GM (GM) is about to announce that it is building a car that will drive itself. It can park, accelerate, break, and drive around traffic congestion.

According to The New York Times "the automaker expects driverless vehicle technology to be ready for testing by 2015 and in vehicles that it sells by 2018." That leaves a decade of people having to handle their own driving, to stay awake at the wheel, and to listen to the radio for traffic tie-ups.

One of the lessons that car companies may have learned by now is that consumers will only buy so many options. Some, like electric windows and doors, become so ubiquitous that the auto manufacturers have to make them standard equipment. Others, like GM’s OnStar communications product, never get much adoption.

The driverless technology is going to have to add huge costs to a car. All the other elements of an engine, brakes, seats, and a radio will have to be there. Not much can be thrown out to cut costs. Even if the technology is mass produced, it is hard to imagine that it will not up the cost of a vehicle by $5,000 or more. The number and complexity of the features is just to great.

Gas prices are likely to stay high for another decade or two. There is no sign that America, India, or China are going to swear off fossil fuels. The probably means that the typical consumer is going to watch how much he will pay for a new car and options. Unless, of course, the driverless tech comes standard.

Douglas A. McIntyre