Mapbox – SPAC Dash

Mapbox claims a navigation niche.

• Hot on the heels of announcing a new CEO and a new strategy (see here), Mapbox has announced a navigation product for automotive which is nicely timed with the possibility of a public listing via SPAC.
• The new product is called Mapbox Dash which is a navigation system designed for the infotainment system that is fully customisable, constantly updated from the cloud, and is available as a subscription service to the OEMs.
• Mapbox has announced General Motors (GM) as the first customer in yet another sign that GM is trying everything that is available to see what works best for its strategy.
• In this case, the strategy is to backfill navigation services to Chevrolet, Buick, GMC, and Cadillac buyers who did not opt for in-vehicle navigation at the point of purchase.
• Some of the 2018 model years and all of the newer vehicles should have access to this service by the end of 2021.
• The service will be delivered through GM’s OnStar Connected Services Package which costs $14.99 per month.
• This move neatly sidesteps a big potential problem with this offering.
• This problem is Google Maps on smartphones which is by far the biggest digital competitor that all of the OEMs have to deal with as opposed to each other.
• GM will be paying Mapbox for this service and so GM has passed this cost on by making it part of a service that its customers are already paying for.
• This will give them a strong incentive to at least give it a try as it will cost them nothing to do so.
• Furthermore, by being fully integrated into the infotainment unit as opposed to being projected by a smartphone, Mapbox Dash will be able to offer a deeper experience.
• The main feature here will be the ability to project the navigation into the instrument cluster as well as other screens that may also be present in the vehicle.
• Mapbox Dash also allows the overlay of media consumption assets like Spotify or podcasts thereby also taking care of the other big Digital Life service utilized by the driver.
• As more and more screens appear in the vehicle, the value of having information that can be displayed throughout the vehicle will increase.
• This is one area where the OEMs can push back against the competitive threat represented by the smartphone because at the moment, Android Auto and Apple CarPlay are limited to the central infotainment display in the vehicle.
• What is new about this launch is that this will be one of the first instances where a completely new service is able to deploy simply through the use of an over-the-air software update.
• I have long believed that this is how all services that do not require a hardware upgrade should be deployed and so far really only Tesla has embraced this.
• Hence, to see GM move in this direction is encouraging as most OEMs bitterly resist changes like this to their detriment.
• Mapbox’s entry into navigation is not going to disrupt the existing status quo although it may dissuade some vehicle buyers from purchasing navigation as an extra at the time of purchase.
• Mapbox is setting out its wares in terms of the new automotive strategy which will allow estimates to be increased and make the proposition more palatable to investors in any SPAC-related listing.
• This proposition further challenges the narrative of automotive-grade maps being required to deliver navigation in vehicles.
• Mapbox’s map is crowdsourced and consequently is not as accurate, detailed, or up to date as the established automotive map providers.
• However, the fact that GM is happy to use Mapbox to offer a navigation experience and the fact that many users are quite happy using Google Maps is an indication that the importance of automotive-grade maps is eroding.
• Maps of this quality are almost certainly required for autonomous driving but these are different types of maps that help the vehicle understand and drive in its environment rather than telling it where to go.
• Mapbox has found a niche in the automotive world, but it will require a lot more than that if it is to justify the high valuation that Softbank is going to demand the SPAC investors to pay.