Daimler courts Amazon, Microsoft

A senior Daimler executive confirmed to the Wall Street Journal on Wednesday that his company and two other German carmakers were courting the American tech giants Amazon and Microsoft as part of a broader plan to establish end-to-end control over their stake in the driverless car market.

Daimler, BMW and Audi are trying to sell Amazon and Microsoft minority stakes in the Berlin-based digital mapping service HERE, which the consortium of top German automakers bought last year for 2.5 billion euros ($2.85 billion).

"We need a cloud provider to handle the huge amounts of data created by HERE and its users," the business daily quoted Thomas Weber, Daimler's head of R&D, as saying. "We haven't taken any decisions yet."

Daimler, which owns Mercedes-Benz, teamed up with BMW and Audi last summer to acquire HERE, which is working to create high-definition, 3-D digital maps that could one day be used to inform autonomous vehicles of road conditions and potential hazards in real time.

Such information - and the means of obtaining, processing and feeding it back to fleets of self-driving cars and trucks instantaneously - is imperative if Germany's top auto makers want to stay independent of companies like Google, which are developing their own driverless cars and have access to similar real-time data through the Google Maps and Waze apps.

"We've always said that we wanted to protect our independence," Weber told the Wall Street Journal.

Foxconn syndrome

His statements echoed similar ones made last month by Daimler's chairman of the board, Dieter Zetsche, who said the company didn't want to become like Foxconn, the Taiwanese manufacturer that makes Apple's iPhones but whose annual net profits, while in the billions of dollars, still paled in comparison to those of the American tech giant.

"The risk of digitalization is that third parties may insert themselves between us and our customers, turning us into the Foxconn of the auto industry, if we don't manage to offer our customers a complete service," Zetsche said in an interview with Reuters.

Germany's reputation for high-quality engineering and design puts it in a unique position to lead a shift to a future in which cars navigate city roads and highways without a human needing to be behind the wheel.

The involvement of big American tech companies - which isn't a given - would bolster the Germans' efforts to create a global network of Internet-connected cars that produce valuable real-time data.

Daimler, BMW and Audi have made clear all along that they intended to look for other partners to enter a joint venture and help share the cost of the acquisition.

cjc/hg (AFP, Reuters, Wall Street Journal)