The Merging Worlds of Technology and Cars – Bloomberg

The Merging Worlds of Technology and Cars

The line between the technology and automotive industries is blurring. The rise of rideshare companies such as Uber and Lyft means that transportation is being tied ever more closely to your cell phone, while autonomous driving technology is turning your car into a computer. But these developments are expensive: Carmakers’ R&D budgets jumped 61 percent, to $137 billion from 2010 to 2014.

Fiat Chrysler Chief Executive Officer Sergio Marchionne thinks it makes no sense for carmakers to spend billions of dollars developing competing, yet largely identical systems. To share some of the risk—and the cost—the incumbent automotive giants and their would-be disruptors are teaming up in an ever-growing, ever more complex series of alliances.

So Fiat Chrysler, for instance, has paired up with Google to develop 100 self-driving minivans, and is in discussions with Uber about a similar venture. Google has, in turn, invested in Uber, as have Toyota, Microsoft and Tata, owner of Jaguar Land Rover. Bill Ford, chairman of the eponymous carmaker, has meanwhile invested in Lyft, as has General Motors, and Lyft has partnered with China’s Didi, itself the subject of a $1 billion investment from Apple.

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