Why Silicon Valley Is the New Detroit

Question: What will cars look like in the coming years?

Felix Kramer: In the future the cars are going to get a lot more slippery, which is what an engineer would say about aerodynamics, so a lot of cars… a lot more cars are going to look like sports cars and like the Prius, very sloped with a spoiler fin I in the back of some sort and there is a lot of things that can be done to make cars move more easily through the air. At high speeds aerodynamics is everything and weight doesn’t matter at all, so the cars are going to look more streamlined, which is okay.

Question: What major carmaker will be making the first plug-in hybrid?

Felix Kramer: The first vehicles that we’ll see in the next year are the first plug in hybrid by a large carmaker. There is some small ones, but the first large one is going to be General Motors with the Chevy Volt, a four-passenger vehicle that most people estimate will cost in the 30 to $35,000 range after tax credits. At the same time Nissan will probably have the first large company’s large volume production with the Nissan LEAF and that’s a 100 mile range all electric vehicle and if Americans understood now what… how this all works they would realize that anyone who has… any family that has a… If Americans thought about it they would realize that every two car family right now, the second car could be an all electric vehicle.

A 100 mile range vehicle is plenty for everybody to do their local driving and then when they want to go across the country they use their first vehicle, but most people go into a showroom and they say, “Well what if one day I happen to want to use that car to drive 1,000 miles?” “I can’t do it.” “I don’t want the car.” But in fact, they could do that right now, so as the 100 mile range all electric vehicles come in I think we’ll see a change in people’s attitudes and from Cal Cars perspective who have been promoting plug in hybrids if we turn out to be wrong about our sense that the platform for future development of most cars for the next ten or twenty years is going to be plug in hybrids, that is vehicles that have an electric range that carries you for your local commuting, but the same car can take you across the country because it does have a gasoline engine as well. If we turn out to be wrong and all electric vehicles get there sooner we win even bigger.

Question: Is Silicon Valley the new center of the auto industry?

Felix Kramer: The whole auto industry is changing. It used to be the Detroit three, then it was the American three, now it’s the you know the American two with Chrysler going to Fiat and meanwhile there are a bunch of startups in Indiana and other places and Silicon Valley has emerged as a center for automotive technology as well because cars are becoming more and more electronic and the control systems become more and more important and the battery technology has become more important, so the whole auto industry is going national and actually international because probably within a decade or two most of the cars in the world will be built in China and other countries in Asia, so this is all changing, but the ability to have local manufacturing is actually increasing as a result of this because when you have a car that is more electronic you can build it in many more places.

The future of the American auto-industry will be based around start-ups, creating slick, even "slippery"-looking electronic cars.

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