Business Take: Will Google's Self-Driving Car Business Be Bigger Than its Search Business?

The search giant has been moving forward with self-driving cars. Will that become its identity?

Jun 3, 2014 at 11:59AM

Though people think of Google (NASDAQ:GOOG) as a search engine, the company has a number of products in the pipeline that could radically change its business going forward. One of those -- the driverless car -- moved a step closer to reality as the company unveiled a new prototype last week.

"They've developed a car that doesn't even tempt you to drive. It has no wheel and it has no pedals," said host Jason Hellmann on Business Take, the show that gives you the Foolish perspective on the most important business stories of the week  

The new vehicle, which looks a bit like a futuristic version of a child's Little Tikes car, is notable because it has nothing to do with Google as we know it now. Though in some ways driverless vehicles are a logical extension of Google's GPS services, it's a huge departure from what has been the company's core business. 

Google Car

 Little Tikes, left, has a wheel but it does not have an engine or gas pedals.

Hellmann asked Business Take panelist Daniel Kline whether in 20 years we would think of the brand as a search or a car company.

"I don't think they are going to be a self-driving car company," Kline said. "I still think the self-driving car is a novelty. Maybe there will be cities that employ the self-driving cars."

Kline added that New York City or Disney World might employ the technology, but it's hard to imagine a world in which Americans give up their vehicles. 

"It feels to me like the Segway ... not a practical item," Kline said.

"I disagree," Hellmann argued. "I see self-driving cars as a really exciting thing that Americans can really get behind."

Hellmann cited the productivity advantages of being able to do other things while traveling. He also brought up the fact that self-driving cars bring up huge insurance questions. 

"What happens when your self-driving car gets in an accident?" Hellmann asked.

Overall if self-driving cars become the norm it should lower costs across everything from insurance to health care, police, and other costs related to driving and accidents. The challenge for Google is handling liability for whatever accidents occur. 

"Google's going to sued," Kline said. "But that may be a relatively trivial expense compared to the millions of these cars it could sell. That might just be an acceptable cost of doing business."

Do you believe self-driving cars will be how people know Google in the future? Watch the full video then share your thoughts in the comments section below.

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Daniel Kline has no position in any stocks mentioned. Jason Hellmann has no position in any stocks mentioned. The Motley Fool recommends Google (C shares). The Motley Fool owns shares of Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

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Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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