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Google and FCA partner to develop Chrysler Pacifica Hybrid self-driving vehicles

04 May 2016 IHS Markit Automotive Expert

Fiat Chrysler Automobiles (FCA) has found a partner in Google to develop autonomous technology, while the technology giant has found a partner to help increase its test fleet and provide an opportunity to integrate the technology into an existing production car.

IHS Automotive Perspective

  • Significance: FCA and Google have announced a partnership that will result in 100 Chrysler Pacifica Hybrid minivans being developed with Google's self-driving technology. Engineers from the two companies will work together in co-located facilities in Michigan, US.
  • Implications: This is the first time that Google has partnered with an automaker, though it may not be the last. The agreement between FCA and Google does not restrict Google from other partnerships. A timeline for when the Pacifica would be ready for delivery to Google, or further commercialisation, is not clear.
  • Outlook: Among the opportunities from the partnership are for FCA to potentially access self-driving technology for its future fleet, or to develop into a larger source of contract manufacturing for Google, and for Google to develop a more thorough understanding of the practicalities of auto manufacturing and development. There are several ways for automakers to advance development of autonomous vehicles into their product ranges − licensing the technology from Google or contract manufacturing for the company is one of those ways and is the route that FCA is exploring with this partnership.

Fiat Chrysler Automobiles (FCA) and Google announced yesterday (3 May) a partnership to expand Google's self-driving test fleet. FCA and Google engineers will work together to integrate Google's self-driving technology into the all-new Chrysler Pacifica Hybrid. The two companies will co-locate in a facility in southeastern Michigan, United States, to "accelerate the design, testing and manufacturing of the self-driving Chrysler Pacifica", according to an FCA press release and comments posted to Google's blog.

"FCA will initially design and engineer around 100 vehicles uniquely built for Google's self-driving technology. Google will integrate the suite of sensors and computers that the vehicles will rely on to navigate roads autonomously," a statement from FCA reads. At the Google+ page for the self-driving car project, Google posted "In the coming months, our team will collaborate closely with FCA engineers. This experience will help both teams better understand how to create a fully self-driving car that can take you from A to B with the touch of a button. Collaborations like these are an important part of realizing the potential of self-driving technology to improve road safety and make transportation more accessible for millions of people. "

In an FCA release, CEO Sergio Marchionne said, "Working with Google provides an opportunity for FCA to partner with one of the world's leading technology companies to accelerate the pace of innovation in the automotive industry. The experience both companies gain will be fundamental to delivering automotive technology solutions that ultimately have far-reaching consumer benefits."

Outlook and implications

Among the opportunities here are for FCA to potentially access self-driving technology for its future fleet, or to develop into a larger source of contract manufacturing for Google, and for Google to develop a more thorough understanding of the practicalities of auto manufacturing and development. There are several ways for automakers to advance development of autonomous vehicles into their product ranges − licensing the technology from Google or contract manufacturing for the company is one of those ways, and is the route that FCA is exploring with this partnership.

Missing from the announcement was any projection of timelines for when the first Pacific Hybrids with self-driving technology are planned to be in Google's test fleet. This is the first stage of the partnership, and must be successfully executed if FCA and Google are to move it to a commercialisation stage.

Generally, IHS expects that there are several strategies to be employed as automakers move into the autonomous space: They can develop the technology on their own (including Ford's autonomous test fleet and Toyota's USD1 billion investment in the space), they can leverage advancements being developed by Tier 1 suppliers, they can acquire start-up companies (like GM's acquisition of Cruise Automation), and they can partner with Google and license its technologies. IHS expects different OEMs to approach the solution in different ways, with FCA clearly signaling it is likely to leverage a relationship with Google for access to the technology.

According to IHS Automotive senior analyst Colin Bird, "Up to now, based on IHS Automotive analysis, FCA has little to no research or development in terms of L3-L5 autonomous car research and the carmaker has made no remarks to the contrary. Thus far, more than 8 OEMs have made autonomous car announcements (mostly with target dates of 2020) and FCA has not been one of them. IHS forecasts that there will be approximately 10.5 million self-driving and driverless (L4 and L5) cars in use globally by 2030."

The partnership is in line with FCA CEO Sergio Marchionne's views on the capital-intensive nature of the industry, and a solution that can be well suited to FCA's situation and strategy − and both FCA's motivation for partnering and lack of experience in the area are elements Google might find appealing. FCA will look to partnerships for access to technology that it does not have either the resources or the expertise to develop on its own, as compared with developing in-house core competency. The approach is in contrast of several other automakers who are developing their own systems, or who lag access to the technology for lack of resources. For FCA, the project gives access to technology with less investment − though it is not indicated when (or if) this project would lead to specific projects for other vehicles in the FCA stable. FCA's interest is expected to include not only access to the technology and engineering development, but also the opportunity to sell autonomous vehicles later, whether that proves out to be as a contract provider to Google or through its own dealer network. For FCA, the move has potential to get them closer to the technology faster and with less expense than otherwise possible.

Google, which has developed a prototype of its own pod-like autonomous vehicle as well as logged millions of test miles using modified Toyota products, prefers to work with several manufacturers for its products. According to Bird, "It has been the belief of IHS analysts that Google not only wants to develop the driverless car software, but that the company would want to partner with an OEM or supplier for a future potential product(s) and potentially a car-as-a-service (CaaS). The company may also simply want to license its technology to OEMs, under a more traditional manufacturer-supplier relationship."

Google also has no direct experience with auto manufacturing or the process of integrating its technology into a vehicle road-ready in today's environment − the self-driving prototype does not meet federal vehicle safety standards as written today, but was developed as much as an example and not production-ready in the traditional sense. The project development with FCA can provide Google valuable experience with the details of manufacturing and adapting the ungainly add-on system it is testing to something that is ready for manufacturing and meets US vehicle safety requirements. While, over time, autonomous vehicles may change some of the current rules on vehicle safety equipment, those changes will come over time. Understanding how to integrate its technology into today's vehicles has potential to benefit Google's future vehicle development programs as well.

Remarks from Krafcik around the North American International Auto Show suggested that, Google also believes in more than one partner for its car projects. A deal with Ford was rumoured, but has not yet been announced, and Bloomberg reports that Google was in talks with GM as well. The company indicated in February it was looking for R&D space as well as engineers in Michigan. Co-locating the engineering development in Michigan, rather than California, ensures closer physical proximity to the teams of FCA engineers responsible for all elements of the minivan, from design to engineering to vehicle development and systems to manufacturing expertise. While Google has said it will test the self-driving Pacifica at its private test track in California ahead of public testing, potential resources in Michigan include FCA's private proving grounds facilities and the MCity autonomous vehicle development center.

About this article

The above article is from IHS Automotive Same-Day Analysis of automotive news, events and trends, and is a deliverable of the World Markets Automotive Service. The service averages thirty stories per day and also provides competitor and country intelligence. Get a free trial.

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