Are cars self-driving Apple’s $1B stake in China’s Didi?

A just-announced $1 billion investment in Chinese ride-hailing service Didi Chuxing serves to expand Apple Inc.’s China strategy on several fronts including self-driving cars.

As reported by Reuters, the U.S. tech behemoth’s decision to invest in Didi aligns Apple with Uber’s main competition for the Chinese market. According to Apple, a key driver of the investment was a chance to gain valuable insight into the Chinese consumer market, an area where Apple has struggled recently as iPhone sales level off.

“We are making the investment for a number of strategic reasons, including a chance to learn more about certain segments of the China market,” said Apple chief executive Tim Cook. “Of course, we believe it will deliver a strong return for our invested capital over time as well.”

The Didi deal gives Apple access to insight from the ride-sharing service’s 11 million rides a day, representing over 87% of the Chinese market for private car-sharing services. However, Didi has been losing billions in its ongoing battle for market share with the aggressive U.S. ride-sharing firm Uber.

From a larger perspective, the Didi investment comes amidst a trend where technology and automotive companies are increasingly collaborating and cross-investing. For example,General Motors recently invested in U.S. car-sharing service Lyft and bought Cruise Automation, a maker of autonomous vehicle technology.

Apple has been closely watched by technology investors for indications that it was diving headlong into developing self-driving cars. The Didi investment is seen as an important step towards Apple’s entry into the automotive business.

Didi investment ties together other Apple interests

The Didi investment is also seen as neatly tying together a variety of Apple businesses, such as mobile payment platform Apple Pay, while diversifying away from its dependence on the iPhone which is seeing sales flatten.

“After all the hints about the service business and what they would like to do in the future, it’s all starting to fit together,” said Moor Insights & Strategy analyst Patrick Moorhead.

Recent studies have found that the Chinese consumer is notably less inclined towards car ownership than their U.S. counterparts, which is advantageous to firms like Didi. But more significantly, the Chinese consumer’s indifference to the freedom car ownership can offer makes China an ideal market in which to develop self-driving cars. And the data on consumer behavior that Didi will provide would be pure gold to Apple in any initiative to develop self-driving cars for the Chinese market.

And the environment for developing autonomous cars just got more amenable. The Chinese government recently made a major commitment to developing the regulatory framework to speed the introduction of autonomous vehicles on its highways and city streets.

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Beverly Hills’ autonomous shuttles to self-dodge paparazzi

The Beverly Hills City Council unanimously agreed last week to work on a plan to develop autonomous shuttles which will provide transportation for the citizens of Beverly Hills.

The idea is to create a fleet of city-owned driverless shuttles which will act as part of a municipal on-demand transportation service picking up and dropping off individuals at virtually any spot in the city.

So, instead of hiring an Uber driver or calling for a taxi, the people of Beverly Hills will be able to call for and hop in driverless shuttles that will take them anywhere in the city they want to go.

The Beverly Hills City Council wants to pave the way for autonomous vehicles to occupy roads in the United States – without breaking the budget of their riders.

Until recently, purchasing a vehicle with self-driving capabilities has been a recent experience reserved for the wealthy.

Tesla recently received over 325,000 reservations of its upcoming Model 3 vehicle, which has a moderately high price tag of $35,000 – roughly half the price of any Tesla vehicle prior. One of the key features of a Tesla vehicle that has so many people eagerly standing in line for it: autonomous driving.

From a safety standpoint, autonomous vehicles are proven to be as safe – if not safer – than ones driven by a human.

According to several studies, over 90% of all vehicle accidents are caused by human error. This includes driving while distracted, intoxicated, or simple lapse in judgement.

Beverly Hills hasn’t yet decided which technology to use

Google’s Self-Driving Car Project has already exceeded 1.7 million miles of autonomous driving on US roadways in cities including: Mountain View, CA, Austin, TX, Kirkland, TA, and Metro Phoenix, AZ.

During all that time, not one accident out of the 11 that Google was involved in was attributed to the autonomous vehicle.

Even a city with as small of a footprint as Beverly Hills’ 5.7 square miles could benefit greatlyfrom this initiative. Traffic congestion, driver costs, the need for parking spaces, and the amount of accidents taking place in its roadways stand to be reduced by an accessible fleet of autonomous vehicles.

This autonomous vehicle program will be discussed in greater detail during a public summit set to be held this fall. Attendees will receive demonstration rides and witness expert-lead panel discussions on the new program.

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Smart cities require smart construction

Many cities around the world find themselves in a complicated tug-of-war between modernization, funding, and preserving history. This makes it difficult for some regions to take advantage of the latest trends and technologies that shape our society today.

The trend of devolution going on as more cities are getting newly-elected mayors and power over their infrastructure’s forecasted needs and development creates an opportune time for cities to adopt a new philosophy of city planning.

Building an evolving, more connected society

However, it’s becoming increasingly important that city leaders take into account not only how their infrastructure is being used today, but what the citizens of their cities will need over the next 20-50 years.

More and more people are using services like Uber. Instead of buying your own car and paying a high monthly payment to do so, many city inhabitants find themselves using these services to get around – and often saving a lot money by doing so.

In a thought piece for Construction News, Amanda Clack, head of infrastructure advisory at consulting firm EY and based in the UK, offered insight on how important smart construction is to the development of a “smart” city.

“Charging points for electric vehicles are springing up across UK cities and are fast becoming a familiar sight,” she said of the developments she’s seeing near her. “The sharing economy is also having an impact – with authorities designating parking for car clubs such as Zipcar over private vehicles.”

Construction of the future mean rethinking city planning

This means a major shift in how mayors, architects, developers and even contractors think about how they plan their cities.

“It’s about getting the right group of leaders together, from the public and private sector, to create, drive and deliver a vision for their city,” Clack said.

She added that this type of change doesn’t happen overnight, and shouldn’t. Budgets alone would explode if every major city suddenly added facilities for electric vehicle charging and designated spaces for ride sharers to park their vehicles.

However, she pointed out, an evolutionary change – gradual improvements and modernizations – are possible.

If we want our cities to become the trendsetters and most livable places they can be, they need to focus on investing their time and resources into evolving their cities to meet the needs of a modern citizenry.

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