Md. Taqi Yasir
If there’s an example of a company about to disruptively innovate an entire industry, it’s Tesla. Partly, this is because of raw technology, and Tesla’s is clearly superior to that of its competitors. Partly, it’s because Tesla has a more efficient business model. As Slate recently pointed out, Tesla bypasses value-subtracting dealer franchises and universally disliked car salespeople. More important, though, Tesla will kill traditional car companies because companies like GM, Ford, and Honda simply do not understand digital technology and are unlikely to understand it any time soon. Tesla is a high-tech company that happens to be making automobiles. They understand technology because without technology a Tesla is just a huge, expensive paperweight.
By contrast, the customary automobile stiffs are heavy equipment manufacturers who are cramming high tech into their products without really understanding it or mastering its complexities. Most people probably assume that today’s autos are more reliable than in the past, because they have all those nifty built-in computers that monitor performance, warn of problems in advance, and so forth. In fact, it appears that the opposite is the case. According to the recent J.D. Power’s Vehicle Dependability Study, late-model used cars are getting less dependable over time. While that study cited engine and transmission issues as the cause of the decline, these are the very systems that the built-in microprocessors are supposed to monitor and improve.
When these built-in microprocessor fail, or are poorly programmed, problems inevitably result, problems that will manifest themselves not as computer glitches but as mechanical failures. Anybody who has been buying cars for any amount of time knows that, when it comes to microprocessors and computer technology, traditional car companies simply don’t know what they’re doing. For example, someone still have a 2000 Honda CRV that runs perfectly except for the digital clock. Now, even back in 2000, a digital clock was a very simple circuit; literally child’s play. Nevertheless, the clock failed after about three years. To make matters worse, when anyone went to the dealership to get it replaced, he/she discovered that the only way to replace it was to remove the entire dashboard, for which they were going to charge a buck of $250.