Will Ford Lead the Stampede of the Dinosaur Disruptors?

What will the transportation revolution look like? - flights to Mars, hyperloops, autonomous vehicles, anon. Is it possible or likely that a century-ago disruptor, may become a new disruptor? The key to divining the future of autonomous vehicle transport, with all of the cool, mind-bending projects ongoing today, really comes down to one thing: scalability.

Few companies can manufacture, deliver, maintain, attract mega-financing, and handle legal hits, when the end users number in the tens of millions in the U.S. alone. The bet would seem to be with a company that has already done it and does it currently. Could Ford be the 'Netflix of Transport' a decade from now?

Ford recently announced that they will be discontinuing auto production (other than the Mustang) and will focus on more profitable SUVs, trucks, and commercial vehicles. Sounds odd but not telling of some grand game plan. Ford's website has a section devoted to "Autonomous 2021" that offers: "The effort to build fully autonomous vehicles by 2021 is a main pillar of Ford Smart Mobility: our plan to be a leader in autonomy, connectivity, mobility, customer experience and analytics. The vehicle will operate without a steering wheel, gas pedal or brake pedal within geo-fenced areas as part of a ride sharing or ride hailing experience." Ford Autonomous 2021

"Geo-fenced areas..." refers to the plan to 'seed' certain cities with these autonomous vehicles and allow the circumference to expand over time, allowing demand to catalyze directional growth. Ford's announced purpose is ride sharing and hailing. Digging a bit deeper, Jim Farley, Ford Executive Vice President and President, Global Markets offers:

But, it’s the new partnership platform we have just launched that excites me most because it will help us validate our self-driving business model by working with partners — like Domino’s Pizza, Lyft, and now  Postmates... Lyft, for example, is already testing the platform, which includes specific communications protocols that will be used to request and dispatch autonomous vehicles from our fleet for times and locations with surging customer demand, or to areas that are often underserved...  In the realm of goods delivery, we want to support small and medium-size businesses who may want to take advantage of delivery services but don’t have the ability to tap into complex, expensive logistics systems. 

Jim Farley's Article (1/9/18) found here

Chris Brewer, Chief Engineer of Ford's Autonomous Projects, explains that on the commercial side of the business, "We’re going to initially own the vehicles and sell time on [them]. Our goal is to literally run the heck out of the vehicle. Suppose you’re forking over tens of thousands of dollars but you only use it five percent of the time — I’ll sell you your five percent and they sell it to someone else and they sell it to a third party. One of the things we want to do is work with businesses, whether they’re small businesses or big businesses, to provide this service in an affordable manner." Chris Brewer quote found here (trucks.com)

The phrase that pays, "We're going to initially OWN the vehicles..." seems to be the glimpse into the master plan. Ford doesn't want to simply make and sell autonomous vehicles. Ford's agenda is to make and own all of their autonomous vehicles. They have the scale to do this in hundreds of thousands of units, or more, annually. A few more points:

• Ford has made acquisitions of Autonomic and TransLoc for scale and microtransit solutions.
• Ford has invested in Velodyne, SAIPS, Nirenberg Neuroscience LLC and Civil Maps
• Ford is focusing on "...[E]xpanding its Silicon Valley presence by creating a dedicated campus in Palo Alto to ensure that these innovations will be made. The Ford Research and Innovation Center that was initially created in 2015 will have two new buildings and 150,000 square feet of work and lab space added..." Ford Autonomous 2021
• Ford is reorganizing its "...mobility products, services and businesses: Ford X, which is responsible for ensuring Ford is continuously discovering and actively incubating new business models, and will oversee the Transportation Mobility Cloud platform; Mobility Business Group, which will oversee Ford Commercial Solutions, Ford’s microtransit businesses, autonomous vehicle businesses, and other future businesses; Mobility Platforms and Products, which will lead design and development for the technology underpinning Ford’s mobility businesses; and Mobility Marketing and Growth, which will seek to drive demand with consumers and commercial customers..." Automotive-Fleet.com
• Business Insider comments, "Chariot allows customers to book seats on the shuttles through a mobile app, and Ford could seek to integrate its self-driving technologies into these shuttle buses, in a similar fashion to mobility firm Navya's setup in London. In addition, Ford agreed to join Lyft's open self-driving car platform earlier this year, which gives it an easy avenue for deploying cars and pulling in revenue from rides, without needing to do the legwork of building its own ride-hailing service. Overall, it's clear that Ford has multiple paths to generating revenue from the massive investments it's made in self-driving technologies over the past 10 years." (emphasis mine) BI Ford Self Driving Car Strategy here

From CNBC, and a repeated theme from Warren Buffet (owner of Geico and other insurance and re-insurance concerns): "The self-driving car business could become a major threat to insurance companies when the technology hits the market, billionaire investor Warren Buffett told CNBC's "Squawk Box" on Monday." CNBC article here How about this?- If a mega-company like Ford owns all of its autonomous vehicles, rest assured Ford will self-insure those vehicles with it's massive balance sheet.

The transportation revolution is close to full launch, at least in regards to autonomous vehicles. Scalability will prevent some 'new-comer' from jumping in. Ford has quietly been massing its resources for a decade and should be an interesting participant when the picture sharpens.

How can anyone be certain that this is Ford's direction? Well, no certainty. But if Ford wasn't going to own all of its own autonomous vehicles, I'm guessing they'd put a steering wheel, a brake and other things car drivers tend to use on their AVs.

I offer no legal, accounting, investment nor any other kind of advice. My opinions are my own and do not reflect those of any employer, employee or anyone or enterprise but myself. I own Ford stock.