Self-Driving Cars, Luxury Trends on Tap at J.D. Power/NADA Conference

Within three years, Adam Jonas, managing director at Morgan Stanley, expects a city like San Francisco to authorize self-driving pods to shuttle its citizens around. At some point soon, Cadillac President Johan de Nysschen says Tesla-style over-the-air updates will become a reality for the brand. But at no point in the near future does Warren Buffett, well, you know who he is, expect self-driving cars to become mainstream.
 
The trio were among the more than 20 speakers at the 2015 Automotive Forum, hosted March 31 in New York by the National Auto Dealers Association and J.D. Power and Associates.

More 2015 New York Auto Show News

Analysts and executives held court on economic trends, dealership strategies, new products and marketing efforts. And Buffett, whose holding company, Berkshire Hathaway, just acquired a major dealership group, took questions on everything from interest rates to Iran.
 
For car shoppers, here’s a rundown of the most interesting tidbits:

• Cadillac’s filling some holes. Cadillac’s de Nysschen, who recently left Infiniti to head up GM’s luxury brand, said he sees Tesla-style over-the-air vehicle updates as “very realistic and part of our time [frame].” Asked what cars are missing from Cadillac, de Nysschen said he’d like to see a proper “luxury flagship” for the brand, as well as something that “could capture the excitement and imagination of the millennials.” The latter is a not-so-veiled reference at the subcompact cars and SUVs from Audi, BMW and Mercedes that are flooding the market with starting prices near $30,000. Compare that to Cadillac’s current lineup. Including destination, the brand’s least expensive car is the $34,210 ATS, and its cheapest SUV is the $38,600 SRX.
• But wagon fans won’t get their halo-car back. Don’t expect to see a return of the CTS-V wagon. Cadillac isn’t planning on a CTS-V wagon or ATS-V wagon for the U.S., de Nysschen said.
• Lexus won’t pull a BMW. Mark Templin, head of Toyota’s Lexus division, said the luxury brand won’t have a plug-in version of the redesigned RX, which debuted this week at the 2015 New York International Auto Show. Lexus also doesn’t want to sprout all kinds of in-between cars, like some of its, um, European competitors: “I’m dead set against having too many cars in our lineup,” Templin said. “With too many cars it creates too much complexity. … Over time, you’ll see more entries, but nowhere near what you see the Germans do.”
• Subaru’s family hauler is still on track. Subaru told us in 2014 that it was working on an eventual replacement for the slow-selling three-row Tribeca SUV. That’s still the case. The brand won’t venture into any other major segments, including premium ones, but President and Chief Operating Officer Tom Doll told attendees that a seven-passenger vehicle is in the works. It will be “larger than our Tribeca,” and it’s “not a minivan.” That spells SUV, folks.
• Self-driving cars could be coming soon to a city near you. Morgan Stanley’s outspoken Jonas expects a public-private partnership in a city like San Francisco that could have autonomous pods whisking people around the city at speeds up to 25 mph. Google and Apple are just the tip of the iceberg; even Uber wants to build a car, Jonas said, and so-called “contract manufacturing” — where a supplier essentially builds the car for your brand — makes the possibility very real. Uber has already kicked off some research, by the way.
• But they might not go mainstream anytime soon. Autonomous cars are still “a long way off,” Berkshire Hathaway’s Buffett said. “If I’m taking over-under on 10 percent [market] penetration in 2030, I would take the under.” He added a macabre illustration: How does a self-driving car respond when a child runs in front of you but there’s another car with four people in the oncoming lane? Computing an outcome is uncertain business, and Buffett warned that whatever happened would land a lawsuit in someone’s lap.