The Price of Myopic Thinking: When Product Vision, Imagination and Innovation Fall Short

IEEE Spectrum Top 10 Tech Cars Issue: April 2007 showcasing the Tesla Roadster & April 2008, with MB's innovative HCCI engine.

I was sorting through some old magazine issues recently, and came across two IEEE Spectrum issues that caught my attention. I had received them when I was doing my graduate program in Engineering, and had held on to them due to my interest in both the automotive and technology spaces. 

They were published exactly within one year of each other, both containing Spectrum's annual issue of it's pick of the Top 10 Tech Cars. As part of the April 2007 issue, Spectrum picked the Tesla Roadster to feature on its cover. In the 2008 issue, it was the innovative F700 engine from Mercedes-Benz that was chosen to grace the cover. But it was as I perused the inner pages containing the articles themselves, that startling details began to emerge, painting a stark contrast in terms of product vision, innovation and choices that in hindsight have had profound consequences, more than a decade later.

IEEE SPECTRUM, APRIL 2007: THE ELECTRIC UPSTART ARRIVES

The article in the April 2007 issue opened with a summary of Tesla and the Roadster. "Electric cars are back", the headline on the main summary page shouted, with the opposite page containing another short heading: "A new kind of car from a Silicon Valley Startup."

The summary of the situation presented by Spectrum is interesting to note. It noted that at the time of its previous issue in 2006, hybrid electric vehicles were considered the state of the art, plug-in hybrids were only being worked on by hobbyists, and General Motors was itself in serious trouble. However, the following lines from the introductory panel make for interesting reading, as it described the automotive technology landscape, taking note of hybrid, plug-in, electric-drive and hybrid, with a special mention of GM along the way:

"Today, the state of the art has passed beyond hybrids to technologies that seemed dead or ridiculously exotic even a year ago: pure electric-drive cars, including fuel-cell vehicles; and plug-in hybrids, which give the option of charging the hybrid's batteries directly from a wall socket...Few analysts will even hazard a guess about when the first pure electrics will show up in the showrooms of major manufacturers. But GM is clearly striving to be the company that puts them there. The auto giant announced several concepts and test fleets last year, all based on a common set of components using electric motors to power the wheels...Many observers remain skeptical of GM's goals,  pointing to the three decades the company spent aggressively battling any and all regulation in the fields of safety, emissions, and energy usage, while a litany of GM innovations languished in laboratories. There was the company's romance with hydrogen, for example, exemplified by Hy-wire, GM's 2002 fuel-cell car. Cars powered by hydrogen fuel cells remain in GM's vision, but they've been recast as a piece of a larger strategy involving electric-drive vehicles."

The main thrust of the panel was on hydrogen, which was being experimented with by Honda, BMW, Mazda, China and many others. Indeed, I myself had just read Jeremy Rifkin's "The Hydrogen Economy" just three years earlier, and was absolutely taken by the vision painted of hydrogen-fueled infrastructure. I had even picked my grad school with the offer presented to work on research related to distributed control and co-ordination of a hydrogen fueling network being proposed at the time in British Columbia by the National Science & Engineering Research Council (NSERC) [3]. A big deal was being made of it at the time. 

In contrast, the opposing panel that covered the Tesla Roadster in the April 2007 issue noted this: "The point of reference is the only recent electric vehicle from a major manufacturer, the late, lamented General Motors EV1. When the EV1 was introudced in 1996, it ran on lead-acid batteries, had a maximum range of 95 km(60 miles), and took up to 12 hours to recharge. The Tesla uses the same lithium-ion batteries found in laptops and digital cameras. Their energy density can be as high as 160 watt-hours per kilogram - or at least four times that of typical lead-acid cells. So the Tesla has a 400-km range and, best of all, it can recharge in as little as 3.5 hours....Tesla Motors is hardly the only new EV maker these days, though its 440 million in venture funding puts at at the top of the list. Globally, more than two dozen companies are offering electric cars of all different sorts, from drab econo-boxes to supercars like the Tesla Roadster." 

IEEE Spectrum Vol 44, N0. 4, April 2007 issue, "Top 10 Tech Cars", p. 34-35: Tesla Roadster

Anyone who has watched the Tesla story since then, or read the recent biographies on Tesla and Elon Musk, such as Elon Musk: Tesla, SpaceX and the Quest for a Fantastic Future by Ashlee Vance [7] or Insane Mode by Hamish McKenzie [8], knows the rest of the story to date. The sad story of the EV1 was chronicled in the 2006 documentary Who Killed the Electric Car?, and a later documentary in 2011 titled The Revenge of the Electric Car covered the story of Tesla from the Roadster to the arrival of the Model S sedan. GM was nowhere to be seen on the electric car scene after the publication of that Spectrum issue, only arriving extremely late to the party with a compact EV in 2017, the Chevrolet Bolt [9]. By that time, Tesla had delivered the Roadster, the Model S sedan, the Model X crossover and had just begun delivery of the Model 3, all of which had redefined the idea of what the electric car could be.

IEEE SPECTRUM, APRIL 2008: THE MB HCCI "DIESOTTO" INNOVATOR

This chronology of events in hindsight is all the more significant, because of what I noticed a year later, in the issue of April 2008. It began with an editorial by John Voelcker, who by that time had become Spectrum's automotive editor, titled An Almost All-Electric Car? Like the previous year's article on the Roadster, it is absolutely fascinating to read in hindsight.  

IEEE Spectrum editorial, April 2008

Voelcker began by recounting the sad story of GM's EV1, before moving onto some news of hope on the horizon, again featuring GM:

"Well, despite all the post-EV1 talk that America's premier automaker had cynically jettisoned its electric and alternative-fuel dreams to pursue gas-guzzling SUV cash cows, GM seems never to have abandoned the e-car game. This time the automaker's back with some economical gas/electric hybrids and fuel-cell vehicles, including a fuel-cell SUV. But the big news is GM's snappy new hybrid plug-in technology, used in the Chevrolet Volt concept car, which some are touting as the Toyota killer."  

The editorial went on to describe GM's approach to the plug-in hybrid vehicle solution with the series hybrid, and Toyota's proposal of the power-split hybrid (which would go on to become the best-selling Prius). Towards the end, in the second-last paragraph were these rather obscure sentences: "Silicon Valley has joined the fray...Other Valley-based start-ups are making high and low-end all-electric cars." That last sentence would have been in partial reference to Tesla.

It was the main article, however, that forms the second topic of consideration for this post. Expanding on Mercedes-Benz's F700 concept car with the DiesOtto engine featured on the cover, Spectrum went into great depth to describe an innovative, 1.8 liter, four-cylinder twin turbocharged engine that had the efficiency of a diesel and the power output of a V8, leveraging Homogeneous Charge Compression Ignition (HCCI) technology. The numbers quoted were simply incredible: a claimed fuel efficiency of 5.3 l/100km (44 mpg) at cruising speed, a power output of 255 hp, in a car weighing in at 1.7 tonnes. The engine was described as one "that combines the advantages of diesel and spark-ignition while avoiding the disadvantages peculiar to both." In the course of the article, another player experimenting with HCCI was also mentioned - GM.

The Mercedes-Benz F700 and its HCCI powerplant, featured in IEEE Spectrum, April 2008

Spectrum's assessment of the MB F700 and its innovative HCCI powerplant concluded with the following paragraph:

"The industry expects HCCI engines to make it into production sometime between 2015 and 2020. This concept car could be the basis of perhaps the least conservative model even seen in the S-Class, the most prestigious Mercedes line. Even ina world of rising ool prices and legislated limits on carbon emissions, this daring vehicle shows that there's life left in the combustion engine."

CONCLUSION

More than a decade (11 and 12 years, respectively) has passed since the publication of those IEEE Spectrum issues. 

So with all that automotive technology innovation, what finally happened?

What do we see having transpired with the edicts on the rise of hydrogen fueling infrastructure, fuel-cells and hydrogen-burning internal combustion engines as we look both around and in the rearview mirror? Nothing of any significance. The speculation in the 2007 Spectrum issue amounted to just that - speculation. The famed BMW 7-series that was toted to run on hydrogen was abandoned after 2007 [4]. The Hydrogen Highway research project that I was supposed to do my Master's research project on collapsed and was abandoned shortly after I arrived at grad school to start my research. As Wikipedia notes, "Five stations were built, one each in Whistler, at the University of British Columbia, in Burnaby, and two that were later moved to Surrey. But aside from Whistler they are little-used. Reportedly, only three leased Ford fuel cell cars remain in Surrey, and there is a fleet of 20 hydrogen buses in Whistler. There are no official plans to build any more fuelling stations as the Hydrogen Highway project closed in 2011." GM's fuel cell vision that started with the AUTOnomy platform has yet to materialize into something commercially significant [5]. Honda did bring it's Clarity fuel-cell powered car to market and it is currently on sale, but it only operates with limited availability California in the United States due to the limited number of hydrogen fueling stations that exist there, and that too within a limited geographical region. It is almost non-existent in Canada as I write this, and could reasonably be considered an endangered species.

The F700 engine is non-existent in the Mercedes-Benz lineup, with the only known operating unit housed in the F700 concept car which now exists as a collector's item, as Wikipedia notes: "The Mercedes-Benz F700 is a concept car produced by Mercedes-Benz in 2007. It was first revealed to the public at the 2007 Frankfurt motor show. It was given as a gift to UAE President Khalifa bin Zayed Al Nahyan." The only manufacturer to bring an HCCI (OttoDiesel) engine to market since then has been Mazda, with the upcoming debut of it's Skyactiv-X engine in late 2020: "As of 2017, the only company which announced to launch a car with a DiesOtto motor is Mazda, with SKYACTIV-X" [10-11].

GM, touted as the champion and visionary of the industry at the time, has not brought a HCCI engine, a commercially viable fuel-cell vehicle, or a meaningful electric-drive linueup (the Bolt is the only EV product to date). The Chevrolet Volt, that was touted with much fanfare in these two Spectrum issues, both as a concept and at its inception as a "Toyota killer", was recently put out of its misery due to lackluster sales, as part of a company-wide restructuring that involved a shutdown of 4 assembly plants in the United States and Canada [12 - 13]. GM is said to be accelerating electric drivetrain development, but it is already behind the curve and scrambling to catch up.

In contrast, the April 2207 issue of IEEE Spectrum closing its summary on Tesla and the Roadster with these sentences that seemed like an afterthought said in passing, rather mundane and obscure: "Tesla also has plans for a second car, a sporty four-seat sedan code-named WhiteStar. The company hopes to launch that car by 2010, at a price of $50,000. To do so, it has set up an engineering center in Rochester Hills, Mich., and plans to staff it with more than 50 engineers." It seems amazing to contemplate the events that have transpired since then; I doubt John Voelcker, the author of the articles in both issues, could have imagined in his wildest dreams the magnitude of what Elon Musk and his team have wrought upon the industry. 

While the MB F700 HCCI engine probably sits unused and gathering dust in a collection, Mazda has brought its own HCCI to market. Tesla has gone from the Roadster to a current lineup of 6 electric-drive vehicles, three of which are in production, one just unveiled a few days ago (the Model Y), and two more destined for production (the semi and the new Roadster), with the Tesla pickup yet to be revealed.

It is instructive to contemplate some of the quotes on electric cars that were referenced during the Model Y unveiling presentation, as an example of the paradigm shift in thinking that has resulted due to the drive to implement the product vision at Tesla:

THEN

"Electric Cars Are an Extraordinarily Bad Idea" - Forbes, 2011
"More like a glorified golf cart than a harbinger of tomorrow tech" - Los Angeles Times, 2009
"Sorry, but electric cars are a waste of space" - Daily Mail, 2011

NOW
"General Motors is Going All Electric" - Wired, 2017
"Ford goes 'All In' on electric cars" - Bloomberg, 2018
"Volkswagen is betting its future on electric cars" - CNN, 2019
  

Contemplating the Tesla phenomenon, Ashlee Vance wrote the following paragraphs at different sections in in his book on Elon Musk:

"He’d started the company to put a dent in the automotive industry and force people to rethink electric cars....Surely Musk did not have the gall to try to revamp the very idea of the automobile and build an energy network at the same time with a budget equivalent to what Ford and ExxonMobil spend on their annual holiday parties...

Yet, one year after the Model S went on sale, Tesla had posted a profit, hit $562 million in quarterly revenue, raised its sales forecast, and become as valuable as Mazda Motor. Elon Musk had built the automotive equivalent of the iPhone.

At the heart of this transformation are Musk’s skills as a software maker and his ability to apply them to machines. He’s merged atoms and bits in ways that few people thought possible, and the results have been spectacular.

What separated Tesla from the competition was the willingness to charge after its vision without compromise, a complete commitment to execute to Musk’s standards.

Tesla had transformed the car into a gadget—a device that actually got better after you bought it....It produces the best Model S it can at the time, and that’s what the customer receives. This means that Tesla does not develop and hold on to a bunch of new features over the course of the year and then unleash them in a new model all at once. It adds features one by one to the manufacturing line when they’re ready. Some customers may be frustrated to miss out on a feature here and there. Tesla, however, manages to deliver most of the upgrades as software updates that everyone gets, providing current Model S owners with pleasant surprises...What Musk had done that the rival automakers missed or didn’t have the means to combat was turn Tesla into a lifestyle. It did not just sell someone a car. It sold them an image, a feeling they were tapping into the future, a relationship.

The Model S also offered a way to fix issues in a manner that people had never before encountered with a mass-produced car....While the owner slept, Tesla’s engineers tapped into the car via the Internet connection and downloaded software updates...Tesla had transformed the car into a gadget—a device that actually got better after you bought it. As Craig Venter, one of the earliest Model S owners and the famed scientist who first decoded man’s DNA, put it, “It changes everything about transportation. It’s a computer on wheels“...

The vehicle handled like a sports car, drove as smoothly as a Rolls-Royce, held as much as a Chevy Equinox, and was more efficient than a Toyota Prius.

If, and it’s a big if, Tesla’s Model 3 turned into a massive hit—the thing that everyone with enough money wanted because buying something else would just be paying for the past—then the rival automakers would be in a terrible bind. Most of the car companies dabbling in electric vehicles continue to buy bulky, off-the-shelf batteries rather than developing their own technology. No matter how much they wanted to respond to the Model 3, the automakers would need years to come up with a real challenger and even then they might not have a ready supply of batteries for their vehicles. “I think it is going to be a bit like that,” Musk said. “When will the first non-Tesla Gigafactory get built? Probably no sooner than six years from now. The big car companies are so derivative. They want to see it work somewhere else before they will approve the project and move forward. They’re probably more like seven years away. But I hope I’m wrong.

As the Model S fever gripped Silicon Valley, I visited Ford’s small research and development lab in Palo Alto. The head of the lab at the time was a ponytailed, sandal-wearing engineer named T. J. Giuli, who felt very jealous of Tesla. Inside of every Ford were dozens of computing systems made by different companies that all had to speak to each other and work as one. It was a mess of complexity that had evolved over time, and simplifying the situation would prove near impossible at this point, especially for a company like Ford, which needed to pump out hundreds of thousands of cars per year and could not afford to stop and reboot. Tesla, by contrast, got to start from scratch and make its own software the focus of the Model S. Giuli would have loved the same opportunity. “Software is in many ways the heart of the new vehicle experience,” he said. “From the powertrain to the warning chimes in the car, you’re using software to create an expressive and pleasing environment. The level of integration that the software has into the rest of the Model S is really impressive. Tesla is a benchmark for what we do here.”"

I should note at this point that I'm not employed by or work for Tesla. I'm not a "Teslerati", a fanboy or own any TSLA stock. I'm just an enthusiastic engineer who likes cars and wants to build innovative things.

As an engineer and from the viewpoint of product management, these points taken together drive home some very important points: the cost of myopic thinking, lack of vision, imagination and long-term focus; the cost of getting "stuck in the rut" of complacency; the failure to discern and act on innovation, even if it jeopardized the comfort of the establishment and finally, the consequences of a lack of agility and drive to make things happen.

There is a lesson to be learned here that almost borders on a parable. It has been said that history repeats itself. As a corollary, to paraphrase George Santayana, those who fail to learn from history are forced to repeat its mistakes. That may well be said of the vision, imagination, innovation (or lack thereof) exhibited by the players in these two IEEE Spectrum articles, and the ensuing consequences of the choices made and paths taken by each one, which are a fascinating study in themselves.

 
REFERENCES:
===========
[1] IEEE Spectrum, Vol. 44, No. 4 (NA), April 2007, p. 34-35
[2] IEEE Spectrum, Vol. 44, No. 4 (NA), April 2008, p.9, 30-31
[3] BC Hydrogen Highway (Wikipedia)
[4] BMW Hydrogen 7
[5] What Happened To The General Motors Hy-Wire?
[6] General Motors Hy-wire
[7] Elon Musk: Tesla, SpaceX and the Quest for a Fantastic Future by Ashlee Vance
[8] Insane Mode by Hamish McKenzie
[9] https://en.wikipedia.org/wiki/Chevrolet_Bolt
[10] Mazda SKYACTIV-X
[11] Mercedes-Benz DiesOtto
[12] GM Killing Off Chevy Volt, Cruze, Impala and Buick Lacrosse Cars
[13] The Chevy Volt is dead; long live the Chevy Volt