BMW boss not afraid of tech rivals: 'Cars aren't iPhones on wheels'

By dpa | 12 January 2023

LAS VEGAS: Big tech may seem to be muscling into the car business, but that is not bothering BMW boss Oliver Zipse, who says his business is not threatened by such rivals.

"We are not afraid of tech players at all because we work with all of them," Zipse said amid a flurry of high-tech automotive unveilings in early January at the just-ended CES tech

He says the future of the car industry lies in the task of combining hardware and software. Companies need to maintain sovereignty over the data, Zipse says.

Vehicles are complicated and that complexity is a hurdle for tech rivals, he says. "The car is not an iPhone on wheels."

His comments come as the tech sector has gained influence in the car industry over the past few years. Google and Apple offer smartphone users the option of having their phones take over the cars' infotainment displays, for example.

Google is also developing the Android operating system that car manufacturers are increasingly using as a software base in cockpits. Google's sister company Waymo is meanwhile building robotaxi services and Apple is also working on autonomous driving technology.

At the Jan 5-8 CES, Sony showed the prototype of a car developed with Honda that is to be launched in 2026 under the brand name Afeela.

All that comes as the car business is undergoing a profound transformation. The transition to electromobility is leading to the creation of new vehicle architectures, while car makers want to earn more money through digital services, beyond vehicle sales.

But customers are only willing to a certain extent to pay for vehicle functions as part of a subscription, in Zipse's opinion. If they pay US$50,000 for a car they are not going to want to say it is not fully equipped, he says.

Those who do not subscribe to built-in technology "have installed it for free," he added.

Zipse was also sceptical about the market prospects for autonomous driving systems, where cars can take over control of the vehicle in some situations. At those times, the liability lies with the manufacturer.

Under common classification, that is Level 3 of autonomous driving. At level 4, a car also only drives itself under predefined conditions, but should not need human intervention.

BMW competitor Mercedes started selling some models with a Level 3 system last year. The system takes over the steering and liability on motorways at speeds of up to 60 kilometres per hour until a person takes back control when requested.

Zipse says the current technical standards are not sufficiently advanced to work as a business model. "A Level 3 system, regardless of whether it is operating at 60, 80 or 120kph, that constantly switches off in a tunnel, switches off in the rain, switches off in the dark, switches off in fog - what's the point? No customer will buy it."

Also, nobody wants to be in the shoes of a car maker in the liability phase, for example, if the car misinterprets a traffic situation when handing control back to the driver. "We are not taking that risk."