As ambitious projects go, Sir James Dyson’s plan to build a car is surely the most ambitious in the industry, comfortably eclipsing last week’s announcement of chemical billionaire Jim Ratcliffe’s plans to launch an off-roader inspired by the Land Rover Defender.
The vacuum cleaner maker is not only planning to launch a car, but is doing so completely on its own, constructing a new factory in which to build the car, powering it with battery technology no car maker has come even close to cracking, and then following it up with a range of other models.
Little is known about the car itself, let alone whether that initial £2billion investment includes the sales and marketing, and dealer/distribution network to take the cars to the masses Dyson needs to become a major player in the electric car game.
Unlike vacuum cleaners, making cars requires a quite extraordinary amount of legislation to adhere to - not just on emissions, but more crucially on crash safety and getting a whole host of highly-complex systems to talk to one another, and reliably. This is hugely costly and crucial stuff to get right, before you even think about what it’s going to look like. Dyson’s early vacuum cleaners were not known for reliability.
Sir James Dyson has recruited some good eggs in which to make the project a success, his star signing being Aston Martin’s old development chief Ian Minnards, a man well versed in creating world-class cars against the odds. For reference, see the Aston Martin V12 Vantage S.
Like its vacuum cleaners, the Dyson car will be a premium product, and priced as such. That means it will be competing head-on with the industry’s biggest players, who by the Dyson car’s 2020 launch date will each have highly desirable and viable electric cars of their own in production, and the networks in which to sell them established.
Unlike Tesla, Dyson will not have a headstart on the competition.
Remember, Tesla has never made a serious profit, and to this point has only been selling larger, more profitable models with the likes of the Model S and Model X, rather than the Model 3 and its smaller margins.
Dyson’s investment will take years to recoup, and the firm will have to hold its nerve in the face of the huge losses the project will initially mount up. For an insight into how stressful it can be to launch a new car company on your own from scratch, watch Elon Musk in the excellent 2011 film Revenge of the Electric Car.
Yet the car industry offers huge rewards. Dyson says that if the car is a success, it will quickly dwarf the revenues made from the vacuum cleaners and other products such as hairdryers, fans, and hand dryers.
China will most likely be the biggest market for the car, a country where the company’s popularity is booming. It is also the country most behind the adoption of the electric car, and with the most power and influence over the rest of the industry. China is also used to new brands; the idea of a Dyson car might not seem so alien there.
It’s the solid-state batteries, which are of a much higher density and are much quicker to charge, Dyson is promising to use which could be key to the project’s success, in giving the brand a key differentiator. Dyson has been developing its own battery technology for two decades, and knows its way around a chemistry lab. It has a headstart on the car industry, perhaps with the exception of Toyota, in this regard. Indeed, if it cracks the technology before the rest of the industry, perhaps a future as a battery supplier could await, too.
A senior car designer told me recently that even on electric cars, which are claimed to offer immense freedom in design, 70% of the car’s design is defined by the packaging requirements. Anything to reduce that will give Dyson the design freedom to to do the car what all its other products have done in reinventing the sectors in which they compete, whether they needed reinventing or not.
But Dyson joins the industry at a time when there is the biggest change in a century. The electrified, autonomous and connected car being developed now will form the basis of technology of cars that will be in all cars up until 2040 and beyond.
Dyson says he’s dreamt about this project since the 1980s, and this project has a sense of a legacy one for 70-year-old Dyson about it. It’s now or never for Dyson, yet he enters the car industry at a time when the opportunity and chance for success for a newcomer has never been greater.