Much of AutoNation’s quarterly conference call included nearly every Wall Street observer who participated wanting more details about the dealer group’s partnership with self-driving technology company Waymo—part of Google's parent company Alphabet Inc.
To recap, AutoNation on Thursday announced a multi-year agreement to support Waymo’s autonomous vehicle program. AutoNation said it will offer strategic capabilities to maximize the life of Waymo's vehicles across the United States.
The company highlighted AutoNation franchised stores, AutoNation USA stores and other AutoNation locations, will provide long-term vehicle maintenance and repairs for Waymo’s self-driving Chrysler Pacifica hybrid vehicle fleet and will expand with Waymo as they add additional brands.
Having served more than 40 million customers and representing 33 brands, AutoNation believes it is uniquely positioned to work with Waymo as it expands its operations. AutoNation will offer complex mechanical and cosmetic repairs to maintain Waymo's self-driving fleet.
So how did the companies get to this point? That’s what AutoNation AutoNation chairman, chief executive officer and president Mike Jackson addressed first, sharing that he visited Waymo six years ago when it was GoogleX.
“I was probably one of the first industry people in the door, and had spent a day debating and discussing their approach to autonomous and had one of their earliest vehicles going down the 101,” Jackson said about his visit that included a journey along one of California’s famous highways.
From that point, Jackson said he interacted with Waymo at least once per year.
“I developed a deep admiration for the rigor and discipline of thought and principle,” Jackson said. “They had the whole approach to autonomy where you have to under-promise and over-deliver rather than over-promise and under-deliver when it comes to autonomy and safety.”
Then, Jackson encountered what he called “an epiphany” with regard to autonomous vehicles.
“I confirmed from my own experience and my understanding of customers that this idea that you can have an autonomous system that the driver has to supervise and be prepared to intervene at any moment doesn't really work,” Jackson recollected. “It’s almost against human nature that you have to pay strict attention and be prepared to intervene.
“So they said they don’t need 99.9 percent perfection, they need 100 percent perfection, which means you need redundancy, duplication and sophistication,” Jackson added.
Then entering the picture is Waymo chief executive officer John Krafcik, who already had a strong relationship with Jackson stemming from his days as one of top leaders for Hyundai.
“He and I had a running discussion that, obviously, these are some of the most sophisticated vehicles on the road and to realize the value of the investment in a vehicle, they need to perform at a high level for literally hundreds of thousands of miles,” Jackson said.
“And we both agreed that AutoNation was uniquely positioned to provide those capabilities, both with our scale and our expertise,” Jackson went on to say.
“So you put that together, you now have a strategic partnership to realize this vision of a shared vehicle that is operating autonomously, but at the highest levels of safety, and we think we have significant value,” Jackson added. “And I believe Waymo is the leader in this ambition to have a shared autonomous vehicle operate on a commercial basis with customers in the marketplace.”
In a news release announcing the partnership, Krafcik concurred with Jackson’s account of the relationship development.
“AutoNation has built a reputation for providing excellent service and maintenance that makes cars safer and more reliable,” Krafcik said. “Both companies have a shared vision of enhancing the in-car experience of our customers.
“With its compelling national footprint, modern facilities and trained technicians, AutoNation will help assure that Waymo vehicles are always in top condition as we bring fully self-driving cars to the public,” Krafcik continue.
And with Waymo’s self-driving hybrid vehicle fleet primarily made up of the Chrysler Pacifica at least for now, Fiat Chrysler Automobiles chief executive officer Sergio Marchionne applauded Jackson for making this move.
“As a long standing partner in vehicle sales and service for our brands, FCA commends AutoNation for preparing their operations to support the maintenance and service of autonomous vehicles, including the Chrysler Pacifica Minivans produced and developed for self-driving in collaboration between FCA and Waymo,” Marchionne said.