No. 969
October 24, 2018

About The Autoextremist

Peter M. DeLorenzo has been immersed in all things automotive since childhood. Privileged to be an up-close-and-personal witness to the glory days of the U.S. auto industry, DeLorenzo combines that historical legacy with his own 22-year career in automotive marketing and advertising to bring unmatched industry perspectives to the Internet with, which was founded on June 1, 1999. DeLorenzo is known for his incendiary commentaries and laser-accurate analysis of the automobile business, as well as racing and the business of motorsports. Author. Commentator. Influencer. The Consigliere. Minister of the High-Octane Truth. DeLorenzo is considered to be one of the most influential voices commenting on the business today.

DeLorenzo's latest book is Witch Hunt (Octane Press It is available on Amazon in both hardcover and Kindle formats, as well as on iBookstore. DeLorenzo is also the author of The United States of Toyota.

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By Peter M. DeLorenzo

Detroit. As I wrote last week in “Tesla Burns, Wall Street Fiddles,” this industry is living in a fog of delusional thinking made up of one part hubris and two parts arrogance, with a large dollop of the ever-present unmitigated bullshit thrown in for good measure.

A charlatan like Elon Musk, who has been deified as America’s most notorious blue-sky visionary, but who has also been enabled and empowered by Wall Street to fleece investors by repeatedly "selling air" when it comes to Tesla, is now dancing on the vapors of empty promises made about the Model 3, which is shaping up to be the Silicon Valley resident genius’s Waterloo when it comes to the business of making cars. When the ugly reality of the Model 3 hits home, with prototypes being slapped together by hand and promised volumes turning into a grandiose pipe dream, Tesla stock is going to crater faster than the latest product put on the field by this city’s hapless baseball team.

But even though Musk may be America’s Air Salesman-in-Chief, he is not the only one engaging in misguided hyperbole and fanciful notions about the future direction of this industry, because right here in the Motor City allegedly smart executives are bathing in the promised glow of a connected future for the automobile, which, by their reasoned analysis, will lead to a future of untold riches the likes of which this industry has never experienced before.

And it may be the most egregious case of delusional thinking that this business has ever seen.

These serious-minded executives are operating under the assumption that having the automobile of the future be a center of connectivity will lead to a world of endless possibilities and open up a vast, limitless future of unbridled profitability. Which is all well and good and even noble to a degree, but it also exposes a fundamental naïveté about the world that is excruciatingly painful to observe. And it certainly wouldn’t be the first time.

The auto companies plan on mining reams of data collected so that they can “know” you down to the very last detail and proclivity, and then they plan on using that data so that your car can tell you where the nearest Starbucks is, or where the shoes you’re lusting after are, or where the best local French fries are, or even where your favorite movies are playing in town. And they think they’re going to monetize these and countless other scenarios of desirability until the cows come home, gleaning profits from consumers and businesses alike.

Right now certain manufacturers are feverishly building data collection “farms” and corralling the power of that data so that they can be an integral part of a connected movement that will propel them to what’s certain to be (in their minds) a new, utopian reality. Except that the movement has long been established, and we already have and use our smart devices for all of this so tell me, what is the driving difference that the auto companies will provide, again? No matter how hard the car companies try to usurp the power of our omnipresent smart devices and convince people that their cars are not only the new centers of connectivity but that they’re actually better at it than smart phones, it’s just never going to happen. Ever.

Do you think I’m exaggerating the gravity of this development? Well, you would be wrong. Auto executives are pissing away billions upon billions of dollars on the quixotic notion that if they turn the automobile – autonomous or otherwise – into a rolling hotbed of connectivity, that everything will be right with the world again and that they’ll be serious players to be reckoned with in The Game. In fact they are absolutely convinced of it.

The ugly reality? There is not a chance in hell that it’s going to happen. The automobile industry – domestic or otherwise – has never gotten over the fact that there has been a seismic shift to Silicon Valley when it comes to societal cool. Smart, handheld devices have transformed everything about the culture here and around the world, and even though the automobile companies are still an inexorable part of America’s industrial fabric and a center of technology and manufacturing expertise, the once ever-present automojo that dominated our culture isn’t there anymore. And it’s not coming back either.

So what to do? The automobile companies actually do know how to do some things better than The New Masters of the Universe in Silicon Valley. For instance the auto companies know how to mass produce a wide variety of precision, complicated machines for a bewildering kaleidoscope of applications that transfer people safely, efficiently and in comfort to their destinations. In fact, most in Silicon Valley – except for St. Elon, of course – have acknowledged that fact both publicly and behind the scenes, so what’s wrong with the auto companies concentrating on that? What’s wrong with the auto companies continuing their pursuit of building the best machines possible while exploring new avenues of propulsion and efficiency? Sure, future automobiles should be ready to be connected – at the discretion of consumers – but connectivity in and of itself should never be the raison d’etre of these machines.

Not surprisingly, rational thinking and logic are in short supply in the auto biz of late, and “selling air” has progressed from being a perennial cottage industry in marketing to an all-hands-on-deck pursuit at the highest levels of these companies. And the Siren Song of Connectivity has lured normally smart auto executives into a zombie state, which has caused them to lose all touch with reality. These auto execs actually believe that they can be Masters of the Universe again, when in fact that chapter of the storied history of the automobile was closed over 50 years ago.

The idea that connectivity is the pot of gold at the end of the rainbow for the auto industry is preposterous. It may be boom times for “selling air” – but beyond that there is simply no there there.

And that’s the High-Octane Truth for this week.