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Crowdsourcing the Car of the Future
  • January 10, 2013 : 23:01
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From the time John B. Rogers Jr. was a boy he had one large and audacious dream. In the 1940s Rogers’s grandfather Ralph Rogers bought the Indian Motorcycle Company and went bust trying to convert the big workhorse cycles into lighter machines that could compete with the Triumph bikes that had entered the American market after the war. Ralph Rogers eventually accrued a new fortune in other industries, but decades later he would lament to his young grandson that the thing he loved best was his old motorcycle company. “It was the thing that got him,” Rogers says.

Jay, as everyone calls John Rogers, grew up tinkering with cars; in high school shop he tore down two Porsche 356A engines. It was out of this love and his grandfather’s nostalgic rhapsodies that he would hatch his own crazy plan—a plan from which nearly everyone tried to dissuade him: Jay Rogers would start his own automobile company. And not just his own auto company but a company that made cars that were different from the ones made by the Big Three automakers—GM, Ford and Chrysler—cars with big personalities, cars he hoped would actually polarize consumers, cars they would either love or hate.

Of course Rogers, who is 39 but looks younger, isn’t the first dreamer to want to show up the Big Three. There was Preston Tucker with his Tucker Torpedo, Malcolm Bricklin with his gull-winged car, John DeLorean with his low-slung modernist car and, more recently, Elon Musk with his electric Tesla Roadster. Their auto bodies—all but Musk’s—are strewn throughout automotive history. But Rogers is different. He doesn’t want to build a single model like the others. He wants to build specific cars for local markets all around the world—a Boston car, a New York car, a Parisian car, a Ugandan car, a Malaysian car. Hence the name Local Motors, which was inspired by Local Motion, a surfboard company whose owner roamed from beach to beach, carving custom surfboards. Rogers hopes to have four of these factories up and running in the next five years with an output of 2,000 cars at each factory. He hopes eventually to have 100 factories.

Rogers harbors another dream—a dream that is much larger. He doesn’t want just to build cars. Jay Rogers wants to reinvent the whole way American companies do business. Although he has sold only 60 cars so far at $75,000 each, he has a theory and a plan for changing business using the internet, and he is sacrificing almost everything he has to realize them. He admits he is so consumed by his vision that he has lost many friends since starting his company and there is friction with his wife because he’s almost never home. “She’s fairly well at her wits’ end,” he confesses. But, he adds, “I have nothing left. I have given my all to this. This is my life.”

It may be an odd obsession for someone whose own family seemed to benefit from the old ways of doing business. But Jay Rogers has his reasons.

People have occasionally compared Rogers to Henry Ford. It is a comparison that makes him bristle. “Ford was a fad that came for a hundred years and now I believe is going,” Rogers says. When Rogers, as a student at Harvard Business School, began to think seriously about starting a car company, he had what he calls a “thunderous moment.” It came while he was conducting a fact-finding tour of the Ford truck plant in Dearborn, Michigan, and his guide complained it was the worst time of the year—the changeover period when the plant shut down its entire production line to tool up for the new models, and the workers sat around idle. If the changes were smallish, it could mean a recess of a day. But if the changes were large, the shutdown could last a month. Rogers realized the Big Three could substantially change the way their cars looked only every seven years or so—once the machinery, which cost hundreds of millions of dollars, had been amortized. That’s why everything moved so slowly in the auto industry. It took too much money and too much effort to change.

Rogers traced this intransigence to Henry Ford. When Ford, under the guidance of efficiency expert Frederick Taylor, routinized the manufacture of cars, mass-producing them on an assembly line, he not only took the nimbleness out of the process so customers basically got the same cars year after year, he also removed the magic of carmaking and sapped the autoworker of pride in his product. That system could last a long time—and it has—but Rogers believes it is doomed. In the 21st century, when everything is becoming more personalized, people want and need to love their cars, and the industry needs to be rethought to recapture the romance of cars. Not incidentally, Rogers also thinks it is the best way to sell cars.

Step into Local Motors’ “micro-factory” in the desert outside Phoenix, and it doesn’t look anything like any other automobile plant. The Dearborn factory Rogers visited covers 600 acres. By contrast, Rogers’s plant is the size of a high school gymnasium. The area is pristine, with beige walls and linoleum floors, and the ceiling is supported by columns decorated with greenery in white plastic planters. Soft-rock music wafts through the air, and there is only the faintest hint of the smell of gasoline or oil. There is no factory whistle, just a brass bell that is rung every time Local Motors enjoys a triumph—be it the completion of a car or a bug being worked out on the company’s website.

Ford’s Dearborn truck plant alone employs 3,200 workers. LM’s full crew is roughly 40, though that is largely because the bulk of the work is done by people who aren’t employed by the company and because the cars’ bodies aren’t stamped in steel by massive machines. The chassis are prefabricated tubes, the bodies are fiberglass covered with vinyl wrap, and the entire tooling costs somewhere around $20,000. Ford, GM and Chrysler have huge office towers for their thousands of executives, but at LM everyone—and that means the marketers, the finance staff, the designers and the tech people—shares one long room, with Rogers at the center of a table in a white rubber wingback chair like everyone else’s. The employees are different too. They are young, mostly in their 20s, and many of them come to work in black Local Motors T-shirts. And they are a disparate group. The web troubleshooter used to be a professional waterskier, the head of the design program is a Frenchman who once worked at a slaughterhouse, the CIO was pried away from a website he was creating for the recently divorced, and the chief salesman is an off-road racer. Another salesman just left the PGA Tour after 10 years. About the only thing they share is their passion for the company, so much so that at times it is almost like a corporate cult.

The word you hear most frequently at LM is not cult, it’s team. There is no hierarchy; just about everyone reports directly to Rogers, who usually shows up to work in a polo shirt, shorts and an old pair of Asics running shoes. Decisions are almost always arrived at democratically. Every Tuesday morning the entire staff gathers for a “stand-up” to resolve any issues or conflicts, from where a car is parked to leaving the factory space in a mess. The sessions are so informal that anyone from the outside is invited to sit in. Later that afternoon Local Motors conducts a “field day” during which everyone stops work to pitch in and clean the factory. Every second Friday they convene a “sprint” to discuss solutions for website problems—a method Rogers borrowed from software developers. To top it off, nearly everyone has been given a stake in the company.

But one of the main reasons Rogers wanted to reimagine the automobile company as a more democratic and passionate institution was to reimagine the cars it made. To date, Local Motors has only one commercial vehicle in production—the aptly named Rally Fighter.

Rogers has described it as an earthbound airplane, adding, “The soul of this car is actually down and dirty.” It is a fierce, testosterone-fueled beast of a machine, designed primarily for off-road, though it is street legal in all 50 states. One writer said, “It looks like it could eat a Jeep Grand Cherokee for breakfast and belch up a Hummer H3.” It certainly wouldn’t be out of place in a Batman movie. It is 189 inches long and just over 80 inches wide, has a 430-horsepower engine and sits high over its wheels like something in a monster-truck rally. The interior is industrial, and it gets only 16 miles a gallon—Rogers insists there are other green attributes besides mileage—but you don’t buy this car for comfort or economy. You buy it for power, and you buy it for show.

The Rally Fighter is not the kind of car Detroit would be likely to design. It is far too idiosyncratic. But the same could have been said of the Tucker or the Bricklin or the DeLorean. Detroit wasn’t going to make those cars either. No, there is something else about the Rally Fighter and Local Motors that may, as Rogers hopes, put them in the vanguard of American business and create the new paradigm he so desperately wants. That something else is the fact that the Rally Fighter wasn’t designed by professional designers, nor was it drawn up in a studio. What makes Local Motors possibly the most unusual auto company ever is that the Rally Fighter was designed on the internet by would-be car designers from all over the world collaborating on LM’s website. Put simply, it is the first entirely crowdsourced car. Rogers is betting that it won’t be the last. In fact, he is betting that this is the future—products not only for consumers but by consumers. And he is laying a very big bet.

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read more: lifestyle, News, cars, issue january 2013

5 comments

  • Anonymous
    Anonymous
    Funny that Rodger's doesn't even drive his own car - he has a 1971 Mercedes. I guess he was too busy working to find the time to build one.
  • Anonymous
    Anonymous
    Very eye opening Neal! Thank you. -Jenna
  • Anonymous
    Anonymous
    To insult Henry Ford and suggest that you are the next coming of the automotive messiah is much more than a bit dilusional. Local Motors is a neat little company for sure, and John Rogers sounds like a talented guy. Still, in 5 years he has designed and built about 25 custom cars (Brizzio does more Hot Rods) BUT to do this he has burned 12 million dollars in the process! To imagine that he will, in the next 5 years, build not 25 cars, but 8,000 cars AND in four all-new facilities, and to find someone to actually print that without laughing out loud, explains why this article is in Playboy Magazine and not the Wall Street Journal. I think Local Motors will probably make money (that's what Harvard MBA's do) but the next Henry Ford? Please. My guess is that with Hubris like this from doing almost nothing, he is destined to be more like the next Paris Hilton rather than Henry Ford.
  • Anonymous
    Anonymous
    A car that is build for The Army res. a Urban assault Vehicle (UAV) No particular job for that car I guess -Michael
  • Anonymous
    Anonymous
    You should look into a company called EV West in San Marcos, CA which has a similar business model and builds a dune buggy looks very much like this one, also with extraordinary performance, except it's 100% electric! They are the same people who drove an incredibly fast electric BMW M3 up Pikes Peak.
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