iTWire – Is Detroit's tech industry becoming America's next hub of innovation?

GUEST OPINION: The automotive industry is experiencing a period of transformation and innovation. Cars, previously consisting of mechanical parts, are experiencing a level of digitization that is transforming the way that vehicles operate. 

To tackle the challenges of global warming, manufacturers are reimagining the world of motor vehicles. This is in order to reduce greenhouse gas emissions, promote sustainable practices, and work towards a safer world. As the designs of computers and cars become enmeshed, the automotive workforce is transforming on a scale that has not been seen since the introduction of robotic information in vehicle production.

Detroit is getting in on the action, promoting investment in the technology and automotive sectors. In the 2020s, Detroit is rapidly becoming the place to be if you’re a graduate of an online MBA from Michigan and are looking to make your mark in automotive. From an automotive exodus to the next innovation hub, let’s explore how Michigan businesses are punching above their weight in a highly competitive industry.

The Evolution of Automotive Design

It’s difficult to believe that electric cars have been around in some form or another for more than a century – the dominance of the internal combustion engine suppressed much interest in electric vehicle development for more than a century – as the old adage goes if it ain’t broke, don’t fix it.

In recent decades, however, greater attention has been placed on the hazardous emission of greenhouse gases, a key contributor to global warming. As the world has sought to reach climate targets and reduce emissions, the automotive sector has been highlighted as an industry that can help address the perils of emissions. With transportation accounting for more than 25% of all greenhouse gas emissions in the United States, changing the design of modern motor vehicles has become essential in reducing emissions in this vital sector.

Modern inventions, such as the humble computer chip, have also allowed for innovations in vehicle design. Technology has come a long way in the automotive space – and this integration with high-power, low-latency computing has led to the operational design of many modern computers feeling more like a high-tech computer than a motor vehicle.

New Frontiers in Manufacturing and Beyond

This rapid shift in automotive design has allowed for the emergence of start-ups looking to invest and develop the technologies of tomorrow. From applications such as vehicle charging technology, battery design, and self-driving applications, new opportunities are coming to the forefront every day.

New players are entering the automotive space – such as May Mobility, a Michigan start-up that looks to offer autonomous driving technology that can be used in commercial fleets. Operating as a software-as-a-service (SaaS) product, May looks to provide automation technology for a wide range of vehicles. Autonomous vehicles are not without their perils, however, if implemented correctly, could help reduce the amount of new vehicles that are required to be manufactured annually.

With the emergence of digital technology also comes growth in the risks and challenges present for motor vehicles. With more than one million motor vehicles stolen in 2022, according to the National Insurance Crime Bureau, a greater focus is being placed on the ways that companies can produce solutions to tackle vehicle theft. Companies such as Canopy Security highlight how startups can emerge from all fields, including security – and present new opportunities for those that look to pursue a career in the automotive sector.

Supporting Startups in Michigan

For many businesses, finding initial seed funding can sometimes be difficult. Existing tech hubs, such as Silicon Valley, provide channels of investment through hedge funds and well-placed contacts.

Michigan is looking to support start-ups at an early stage – with the Michigan Economic Development Corporation operating a number of funds, such as the Michigan Mobility Funding Platform and the Entrepreneurship & Innovation Pre-Seed III fund. Most notably, Michigan attempts to lead the way in connecting prospective investors with exciting start-ups – offering the potential for grants and funding for well-vetted ideas.

There has been a great deal of success from Detroit-based companies, both within and beyond the automotive sector. Where companies such as May Mobility and Canopy highlight the successes of automotive startups in Michigan, non-automotive companies such as online clothing marketplace StockX are thriving.

The Future is Bright For Detroit

Starting a business can be challenging – even for those with the brightest of ideas, sometimes starting a business can be challenging. Fortunately, Michigan offers a range of support for the budding entrepreneur – providing support to maximise the potential of these budding organizations. 

No matter whether you’re looking to leap into a new tech-based role or are simply excited to explore opportunities, Detroit is a fantastic place to get immersed in the world of startups. Time will tell if Detroit truly becomes the next Silicon Valley – but by all accounts, it’s looking hopeful at this stage.