Strength in Numbers: Local Motors

Big statistics are an accepted part of the car industry. Dismantle Tesla’s new sedan and you’ll find more than 7,000 battery cells, for example, and in 2011 over 4.2 million vehicles were built in South Korea – more than double the number built in the US.

But consider this: there are around 30,000 component parts in a modern car, and in December last year General Motors had 788,194 unsold cars and trucks on its hands. That’s 236,458,200,000 headlights, inlet manifolds, bolts, radiators, sun visors and all manner of parts crafted and put together at great energy and expense that were and still are sitting on forecourts and in parking lots, doing very little. And that’s just one, albeit a very prominent, automaker. That can’t be right.

LM's first and, right now, only microfactory is in Arizona, but they plan to build further afield

It is right, but there’s an antidote in the form of Arizona-based Local Motors, who are bucking the trend by manufacturing low volume, made-by- demand cars born from the collective minds of thousands of designers, engineers, CAD modelers and fabricators. Local Motors is the world’s first open-source automaker, and CEO and ex-USMC man Jay Rodgers believes this is the way to give people the cars they actually want at less detriment to the environment.

“Today, if you have an idea for a car, you are so far away from getting that idea into an actual car it’s almost unfathomable,” he argues, adding that after building test systems that would be beyond the capital capabilities of almost all inventors, finding someone with the money and desire to buy the technology and take it forward would present an equal challenge. “The odds are that at the end of their [an automaker’s] test and evaluation period they would return it to you and say ‘thank you but the efficiency gains are not great enough for us to invest in a plan where we would roll these out eight years from now’ ... and you’d be out of business.” Brutal this scenario may be, but it’s also the status quo in an industry that’s systematically holding itself back, stifling ideas by hiring intelligent people into relentlessly intransigent positions – straightjackets – and expecting them to come up with rapid innovation across what has become an increasingly complex enterprise. Rodgers points out that the engineers working on Chevy’s range- extending Volt obviously ‘aren’t idiots’, so how did they manage to spend over a billion dollars in developing hardware that had already been done?

Crowd- or open-sourcing is the antithesis of this corporate attitude, and in the automotive arena it offers people a previously impossible shot of seeing their idea make it into a production car. “We have tried, and been very successful, at creating the first version of a platform where people with great ideas can discuss them without fear of being told ‘that will never become real’”, Rodgers proudly explains, and this apporach is evidenced in Local Motors’ first car: the Paris-Dakar-esque Rally Fighter. Everything about the Rally Fighter – now eighteen months into production - is the result of a community that shares ideas in a virtual space known as ‘The Forge’ – Local Motor’s living room in more ways than one. It’s also a tangible example of Local Motor’s desire to devolve the needlessly complicated makeup of modern cars – it’s 40% lighter than anything else in it’s class and passes up innovation for innovation’s sake (the recent glut of fault-prone electronic parking brakes being a particularly irking illustration of the problems caused by incessant one-upmanship). Incremental innovation is the enemy.

LM only stock parts for a very short time, so construction is both quick and frugal

As mentioned, the car’s design, its powertrain, and its dimensions, even the name ‘Rally Fighter’ – they’ve all been reached through community-wide discussion and that’s what makes this car, and any subsequent cars that Local Motor decide to build, so exciting. Each car is a product of a given community’s taste, and there’s nothing to say that had the Rally Fighter been built in one of Local Motors’ micro factories of the future – possibly in the Middle East or Russia – it may well have turned out very differently as both regional aesthetic tastes and the needs of the community would be different. There’s clearly potential here, as Rally Fighters have found homes in Russia, Kazakhstan, Poland and the UAE, although most customers reside in the US. Rodgers hopes to see the business expand and with the goal of building niche cars in the environments where they will be used and appreciated (very different from shipping thousands of cars across the world as the major OEMs currently do) has identified seven desert regions around the world that Local Motors can pursue selling Rally Fighters.

So how do you go about getting your own Rally Fighter, or any car, for that matter, which has been dreamt up in the creative furnace of The Forge? The inspiration, or genesis, for a car usually comes from one of the community’s industrial designers. It’s not hard to imagine that there’s a plethora of exciting future projects that Rodgers and his colleagues have to choose from, either. Local Motors purposely avoided putting a price for the Rally Fighter online as it would encourage curious and potential buyers to call up and ask, and that initial contact is all-important. “When people find out who we are, they want to be part of it, especially when we take them out [in the Rally Fighter] over a jump or something. Then we tell them that they’ll actually be building the car,” explains Rodgers in a fashion that has parted many a car-lover from the $75,000 it costs to own what can only be described as a cross- country weapon. Then the buyer spends between three and six eye-opening days at the factory and, under supervision, builds the guts of their own car, “like and adult Lego process.” Tempting? Not half.

J Rodgers, a former marine, is now CEO of LM. He's also a multiple classic SL owner, too.

Speaking to Rodgers shortly after his return from negotiating a new micro factory in the Middle East, he explained that “building micro factories around the world, to build low volumes, is very much part of our plan to change the ecosystem of specialty automotive.” The micro factories themselves, whilst quick and, at $300,000, relatively cheap to build, are surprisingly flexible and could potentially house ‘production lines’ for four vehicles simultaneously. This would, however, go against Rodger’s policy of only storing mechanical parts in the supply chain for one-and-a-half weeks and solely ordering what Local Motors can use. More vehicles mean a larger stockpile.

If things go to plan, however, there may well be a need to produce more than one vehicle at a given factory, as a region’s climate, economy and taste may facilitate more than one niche. For example, a city of 1.5-2 million people on the edge of a desert may yield a market for not only a Rally Fighter-type vehicle for buyers to enjoy, but also a smaller, electric vehicle for urban environments. Electric vehicles are certainly on the radar for Local Motors, especially as early adopters of environmentally friendly cars not only want something more unique than a Prius, for example, but are often prepared to pay more for the privilege. This isn’t simply cynicism on Rodgers’ part, however, as he estimates that simply getting an electric motor system into a car would cost around $30,000, or double that of a similarly capable gas engine. Factor in the standard industry mark-up of around 200% and you’re looking at $60,000 before considering the rest of the car. Would people be prepared to pay? Yes, but possibly not enough people to make a profit, and Local Motors is ultimately a business.

“Right now the community is working on something called an ‘open tandem’ which is sort of a reincarnation of the Messerschmitt, so it’s an inline-seated vehicle to be made for under $10,000. It’s not an electric vehicle, but it’s a small-block, one-litre, super light, inexpensive vehicle for two people made for highway driving,” says Rodgers, but there’s clearly a personal desire to build something electric that’s tailor-made, as this is the direction that we’re all steadily moving in.

The circumstances have to right, though. “We want to sell them locally, we don’t ever want to pay for international marketing. It’s part of business plan that if you make a niche vehicle, don’t try and sell it to people who aren’t in the niche.” It all goes back to the idea that buyers should not have to compromise on the car they buy – currently buyers have a choice of cars that are adequate or even very good to everyone, but absolutely perfect for nobody.

LM's first car, the Rally Fighter, in full flight. The idea is to build cars in the appropriate place

Local Motors and the Rally Fighter raise the question about what exactly is sustainable motoring? Is it a Nissan Leaf, which although clean at of point use, has skeletons such as battery recycling, supply chain, an enormous inventory and extra tooling for complex servicing that soon becomes obselete in its closet? Or does the future lie in low-volume, locally-sourced vehicles that are tailored to the users needs, challenge the culture of changing cars regularly, and are enthusiastically designed and built by the buyer? In the end it comes down to what we want and what we need, and Local Motors seem to be offering both.

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