Loser: That Sinking Feeling
In the teeth of a global recession, an aquatic-car company ramps up to enter a market that's never made money
This is part of IEEE Spectrum's SPECIAL REPORT: WINNERS & LOSERS 2009, The Year's Best and Worst of Technology.
Soldier, scientist, and reputed sorcerer Raimondo di Sangro invents an internally propelled amphibious carriage.
In 1961, the world’s first mass-produced aquatic car came to market. The Amphicar, built in West Germany around a state-of-the-art Leyland Motors engine, could go 113 kilometers per hour on land and 7 knots on the water, and it cost a modest 11 200 marks (about US $20 000 today). Yet in seven years it sold a mere 4000 units.
For a boat, it was a good car; for a car, it was a good boat.
So what makes Gibbs Technologies, of Troy, Mich., think the prospects for an amphibious car are any better today? That’s the $64 000 question. Or, more accurately, the $85 000 question, because that’s the least it’ll cost to get behind the wheel of an Aquada, the spiritual successor of the Amphicar.
Like its predecessor, the Aquada is a technical marvel. And it too might sell several hundred units in its first year—whatever year that turns out to be. As recently as last June it was expected to be 2009, but in October, company president Neil Jenkins told this reporter it would be ”later than 2009.” It’s just the latest of a long series of delays.
Founder Alan Gibbs built his first aquatic vehicle in 1995, began design work on the Aquada in 1997 in Detroit, moved to the United Kingdom a couple of years later, and in 2004 announced that the first Aquada would soon roll off the production line. That June, billionaire adventurer Richard Branson tore across the English Channel in a prototype in 100 minutes. A £150 000 version (then about $270 000) was to be sold in the UK that September, but supplier problems kept the car from going into production. The company spoke of getting a left-hand-drive version into European showrooms by the end of 2005. That didn’t happen either.
The year 2007 found Gibbs Technologies in the Detroit suburb of Troy, promising a U.S. model in 2009. This time, the company got cold feet. ”A number of items cropped up,” Jenkins says, ”which really said that while it was ideal for a European climate and the European market, there were some things that needed changing for the U.S. So we’re in the process of engineering those changes and implementing them. It won’t be 2009. I don’t actually have a date for you yet.” He also conceded that the new features would drive the Aquada’s price even higher.
Fortunately, Alan Gibbs doesn’t need to sell cars to put food on his table. He’s not even relying on venture capital, having made several fortunes himself, first in manufacturing—television sets, refrigerators, masonry bricks, brassieres, and a lot of other things—then in merchant banking, car dealerships, and a pay television network.
You might even argue that with very few takers the car could still justify itself as a loss leader—a sexy product that casts a halo over Gibbs Technologies’ other, more marketable offerings. These include the Quadski, a combined all-terrain vehicle and jet-ski-style boat, and the Humdinga, a light amphibious truck.
The Aquada’s image might even buff Gibbs’s military business. In July, Gibbs announced an extensive partnership with mammoth defense contractor Lockheed Martin to make amphibious military vehicles that match the Aquada’s 45-km/h water speed. Today’s versions still dog-paddle along—at 7 knots, or about 10 km/h—the way their predecessors did 60 years ago in World War II. Ravi Vaidyanathan, a professor of systems engineering at the Naval Postgraduate School, in Monterey, Calif., says that Gibbs’s speed on both land and water ”could be very useful for ’rivering’—if the vehicle could also go off-road.”
Yet if all you want is image, you don’t need to mass-produce the Aquada; just give a single car—like Branson’s prototype—to Columbia Pictures for use in the next James Bond movie.
You can just picture it. Bond barrels through a haze of bullets on Chicago’s Lake Shore Drive as enemy agents corner him by the Lake Michigan shoreline. Just before plunging into the water, he hits a button on the dashboard. A hydraulic system retracts the wheels into their wells. Bond’s foot hits the accelerator again, and the already spinning propeller bites down, throwing a jet of water out the back at 100 cubic meters per minute—enough to generate a metric ton of thrust. Hapless SPECTRE agents can only stare angrily from the shore as the Aquada speeds away at 65 km/h. In the next scene, our hero steers with one hand, a dry martini in the other, as he smiles back at the bikini-clad beauty water-skiing off the rear of his aquacar.
Making a water jet that pulls a water-skier isn’t hard, of course, but designing one that does so while powering a boat weighed down with a car’s guts is quite another. Thus the 2.5-liter V6 engine, which puts out 130 kilowatts (175 horsepower) and 240 newton meters (177 footâ¿¿pounds) of torque—every bit of which is needed to haul around three independent bilge-pump systems and drive a 90â¿¿ centimeter-long 40-kilogram water jet. According to Jenkins, that’s half the length and a third of the weight of any other jet with a comparable level of thrust—just one of the many design challenges the company had to overcome.
Of course, another big challenge was just staying afloat. To that end, the designers omitted doors. Instead, you step up and into the vehicle on a rail that runs along the side, which deflects spray from the interior. It also helps the vehicle corner on the water, together with two additional rails underneath. A hydraulic strut lifts and retracts the wheel and tire assembly into the wheel housing.
Most of the Aquada’s innovations, such as sensors that don’t let the wheels retract until the hull is surrounded by water, would have been difficult to imagine and impossible to implement in 1960, when the Amphicar was being designed. And certainly there are more people who might find an amphibious car useful today.
Back in 2004, an enthusiastic Richard Branson, fresh from his record-breaking Channel crossing, announced plans to use the Aquada as part of the limousine service for his Virgin Airlines, which picks passengers up at home. ”But unlike our other limos,” Branson was quoted as saying, ”when the Gibbs Aquada hits traffic on its way to or from central London, the driver simply heads for the nearest slipway and takes to the Thames before rejoining the roads on the final leg of the passenger’s journey.” Unfortunately, the Aquada is far from a limousine. There’s only one seat up front—in the middle—and two in the back. A Ford Mustang has more room, at one-fourth the price.
What about other riverine locales, such as New York City, where you have to cross the Hudson to reach New Jersey? Jenkins says he’s talked with city officials and believes that amphibious crossings will be allowed. Commuters who now must take the George Washington Bridge would thus be able to save $6 to $8 a pop on tolls, enough for the car to pay for itself—in 44 years.
So does the Aquada’s prospect for success all come down to price? Of course it does. Alexander Edwards, president of the automotive division at Strategic Vision, a large analytical firm, thought that at $39 000 or so, there were ”a fair number of people entering the luxury market that might think this is an interesting option.” But that’s less than half the price Gibbs is contemplating. Tom Libby, a senior director at J.D. Power and Associates, agrees. ”If it comes in too high, volume will be very, very low,” he says.
On top of all that is the slight friction in the credit markets that you may have been reading about lately. That friction, and the economic contraction it has set off, will surely cut down on the number of people shopping for luxury cars. What does that do to Alan Gibbs’s plans?
So far, he’s sticking to what he said last year, when he predicted he’d sell 100 000 units a year in the United States, including all Quadskis, Humdingas, and military vehicles. He says he expects to ramp up to 1500 employees three years from now, from the 100 or so he has today. He plans to move his headquarters to Auburn Hills, Mich., and he’s shopping around for a manufacturing site.
I wish Gibbs well. In fact, as I contemplate another bout with the George Washington Bridge’s toll collectors, I would dearly love to be wrong in labeling the Aquada a losing proposition. But like most car buyers about to walk into a car showroom, I don’t have an extra $60 000 to throw around.
For more articles, go to Winners & Losers 2009 Special Report.
Snapshot: Water Wheels
Goal: To produce a commercially successful aquatic sports car.
Why it’s a loser: Comparable sports cars can be had for far less. Few will pay a US $60 000 premium to drive across a river.
Who: Gibbs Technologies
Where: Auburn Hills, Mich.
Staff: 100 and hiring more
Budget: Info not available
When: Any year now