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Grant Gerke writes about manufacturing, factory and plant automation, packaging, electric cars and renewables for business and consumer media sites.

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Wednesday
Dec122018

New Safety Perceptions for Cars Coming from Tesla

The phrase “follow the money” is being tossed around a lot in the halls of Washington D.C. these days, but another theme emerging within the electric car industry is “follow the self-driving technology.” Self-driving is an exciting topic due to its dramatic implications for the car industry, but in the meantime, Tesla is attaching itself to the technology to push forward a new, car safety narrative.

This isn’t your dad’s Oldsmobile meets Toyota safety marketing narrative, either. The safety marketing message includes Tesla’s Full-Self Driving (FSD) technology and the company’s solid National Highway Traffic and Safety (NHTSA) ratings.

Safety has always been a talking point for Musk, and he addressed the topic with the help of Madan Gopal, functional lead and principal safety engineer at Tesla in the most recent earnings call back in late October.

“The company (Tesla) came up with the lowest probability of injury metric, which is part of the new U.S. Car Assessment Program (NCAP) rating,” stated Gopal. “The Model 3 has the lowest probability of injury and there are a total of 900 plus vehicles since 2011 that have been rated.” According to the NHTSA website, “this new 5-Star Safety Ratings Program provides consumers with information about crash protection and rollover safety of new vehicles beyond what is required by Federal law.”

During this earnings call, Musk alluded to the “gaming” of car safety tests by some carmakers for specific impact areas on the car so that automakers can achieve better ratings. Musk referred to Tesla’s approach as holistic and system design approach, compared to others “not just sort of strength in where we know the test will happen and that kind of thing.”

To me, the groundwork is being laid for this 21st-century perception of safety by an automaker. Tesla is aiming, on some level, for Toyota’s position as the safety leader and, of course, is doing this without any traditional media advertising to repeat the company’s bonafides.

Alexander Edwards, President at Strategic Vision, a research-based consultancy, believes the foundation of car buying is security and trust. The automotive consulting company conducts surveys and has come up with a customer love index (CLI) metric that includes a trust and security satisfaction for cars. Once an owner feels trust and security with a car purchase, a “love index” can materialize if specific attributes are met, such as freedom, pride in our choice, fun, feelings of success.

Does this sound familiar, Tesla owners?

Musk is aiming big and many critics point to the Full Self-Driving (FSD) development being too slow to be relevant, such as E.W. Niedermeyer, an Automotive News writer. After the most recent earnings call, Niedermeyer tweeted “If we were seeing similar progress on the FSD front, that would truly be something. Unfortunately, that story is only becoming more and more tortured with every contortion and double-down. I’m not sure Musk gets that it ain’t 2016 anymore… things have changed.”

 

This tweet comes following the announcement of a new chip for the FSD — previously mentioned in the Q2 earnings call — that will produce a tenfold increase in computing power over Tesla’s current NVIDIA computer with an eye towards for FSD, which is known as level 5 by the Society Automotive Engineers (SAE).

 

Tesla’s neural network is also expanding and learning new routes by the nanosecond with more Model 3 drives into the wild.

Stuart Bowers, VP of engineering, said this in the recent earnings call, “One area that I’m personally really excited to build on this improvement is active safety. With the advancement in neural networks, covering 360 degrees of view around our car, we can provide a level of constant vigilance that humans just can’t.”

Oh, there it is again, a new safety paradigm via autopilot and there’s only one company pushing this narrative due to the company’s maturation in so many non-traditional areas of car manufacturing: battery development, software development and infrastructure build-out.

The company has had manufacturing issues, but Tesla just started manufacturing mass-market cars. In this day and age of instant declarations via media platforms, time perspectives can get a bit twisted.

The Jeffries Financial Group just updated Tesla to a buy rating due to its apparent consistency in manufacturing. Jefferies analyst Philippe Houchois recently stated, “Tesla has demonstrated its profit and self-funding potential, its growth becomes value-accretive just as peers are engaging in a mostly negative EV sum game.”

Tesla has clear momentum with this marketing narrative around safety and is pushing the message whenever it can. There is a risk with this approach, but Elon Musk has an immense tolerance for the ups and downs of self-driving technology and where it can go.

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