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The Wall Street Journal has an article about how traditional carmakers like Ford are benefiting from the surge in e-commerce delivery.
This got me thinking: Booming growth in ecommerce has obviously reshaped traditional businesses like retail and delivery. And much has been made of the fact that retailers are bringing fulfillment in-house.
Consider, for example, Target buying Shipt or Amazon building out its own network of subcontractor delivery fleets or creating “Prime Air.” These plausibly create some kind of weak point for growth at “traditional” folks like FedEx or UPS
But delivery and logistics networks are obviously incredibly sophisticated, and it’s hard to imagine a future where Amazon or Target or Walmart do *all of their own* logistics.
At the same time, it’s easy to gloss over how this shift produces real benefits for traditional, capital-intensive businesses like carmakers Ford or Fiat Chrysler, who have substantial manufacturing moats.
Amazon may build out a delivery fleet, but it’s unlikely to build its own delivery vans or planes, at scale, in the near term.
This jibes nicely (I think!) w/ something Ben Thompson of Stratechery mentioned a while back: the rise of Uber/Lyft and autonomous vehicles is better for commodity vehicle makers than it is for differentiated brands – you don’t particularly care if your robot taxi is a Mercedes or an Audi. And so all the brand-building behind the “Ultimate Driving Machine” doesn’t much matter when you’re not the one doing the driving. And while being a non-differentiated supplier of, say, delivery vans, doesn’t really give you a whole lotta curb appeal, but high upfront costs, a technical moat, and an auto parts supply chain can be remarkably difficult to replicate. Tesla’s attempt to rethink auto manufacturing, while valiant, proves that there’s a reason why there are far fewer carmakers than software firms.
Silicon Spatula 