Automotive industry executives who are looking at the future of automobiles “should look beyond the traditional industry hubs in Detroit, Frankfurt, and Tokyo to a place that might appear to be an unlikely location: Israel,” a think tank expert wrote in Foreign Affairs on Tuesday.
Avi Jorisch, a senior fellow at the American Foreign Policy Council, wrote that Israel’s importance to the future of the automotive industry has increased, given the push by companies such as Ford, General Motors, Fiat Chrysler, Google, Lyft, and Uber to develop autonomous, or self-driving, vehicles.
Jorisch explained the environment in which Israel plays such a outsize role:
Future cars will use less sheet metal and iron and rely more on software. Engineers must overcome huge challenges to seamlessly integrate cutting-edge computer chips, communication devices, and data analytics, all while protecting vehicles and drivers from potential cyberattacks. Israel’s strong military and academic culture, along with its edge in information technology and cybersecurity, gives it a competitive advantage.
Israel has more than 5,000 startups and 750 venture-capital-backed companies, and the country attracts more venture money than any other country in the world relative to the size of its economy. In addition, Israel’s so-called Silicon Wadi, or valley, has the second largest number of technology startups per capita, right behind California. Even though Israel lacks a native automobile production industry, companies focusing on this global sector comprise about 15 percent of Israel’s industry sector businesses, and their numbers are growing steadily. In the last two years, Israeli automotive startups have raised $820 million, according to Yoram Oron, founder of Vertex Ventures and a member of the Singaporean sovereign wealth fund Temasek Holdings. In addition, over 500 Israeli companies are currently focused on creating the infrastructure for driverless vehicles.
Jorisch noted a number of collaborations between auto giants and Israeli firms. Volkswagen invested last year in Israel’s Uber-like ride-sharing app Gett as part of its strategy to create a fleet of smart vehicles. Volkswagen also invested in a cybersecurity firm partly owned former Shin Bet head Yuval Diskin.
BMW and the tech company Intel signed a deal last July with the Israeli firm Mobileye, which makes accident avoidance systems, to partner in developing a driverless car by 2021. Mobileye’s technology, which warns drivers of other vehicles that are too close, is being integrated into vehicles made by Audi, General Motors, Hyundai, Renault-Nissan, Tesla Motors, and Volvo.
And last August, Ford bought SAIPS, an Israeli machine learning startup in its attempt to develop an automated car.
As Volkmar Denner, CEO of Robert Bosch GmbH, the world’s largest supplier of automotive components, said last year, “Israel is a highly developed business location. Relative to its population, no other country is as innovative.”
Even when not investing or collaborating with Israeli companies, global car makers are seeking to benefit from Israeli technical expertise. Daimler AG, which owns Mercedes-Benz, and General Motors both established research centers in Israel last year. And in February, Honda and Volvo opened a joint development center in Tel Aviv.
Prof. Thomas Weber, the former head of research and Mercedes-Benz car development at Daimler, observed that the company’s research and development center “is aimed at boosting the global R&D array with the help of Israel, the high tech nation.” Jorisch added that “Israeli technology companies have been extraordinarily successful in fostering innovation in fields that directly affect the autonomous car industry: cybersecurity, communication, computer vision, sensors, and artificial intelligence.”
Jorisch also pointed out that governments are also availing themselves of Israel’s expertise. Last May, then-United States Secretary of Transportation Anthony Foxx signed a memorandum of cooperation with his Israeli counterpart, Transportation Minister Yaakov Katz, establishing a jointly-operated $40 million center to develop autonomous vehicles.
And after signing a bill last December allowing autonomous vehicles on the road with no driver in the front seat, Rick Snyder, the governor of the historically auto-centric state of Michigan, traveled to Israel to meet with companies involved in developing automotive technologies. “Israel has an important role in the development of autonomous vehicle technology,” Snyder observed. “The United States, and Michigan in particular, [have] a lot to learn from the Jewish state and we welcome their expertise.”
Jorisch described the automotive industry as being in “transition,” writing that soon, “how humans use their cars will fundamentally differ from how they use them today.” Because of this, he recommended that “as the auto industry transitions from semi- to fully autonomous vehicles, it should continue to look to Israel to help it cross the finish line as quickly and safely as possible.”
[Photo: Mobileye / YouTube ]