The Steve Jobs Warning Automakers Ignored for 30 Years

Welcome to Issue #90 of The German Autopreneur.

Last week, I was invited to speak at Stellantis. The topic? The current state of the automotive industry.

Let's be honest: We're in crisis mode.

But today, we're not discussing symptoms. We're going to the root cause: The broken operating system of Western automakers.

I explain this with a simple framework: The 3+1 transformations.

The first three? Everyone knows them. They're about technology. And yes, they're hard.

But the +1 is different. And right now, it's the one breaking everything.

The 3 Technological Transformations

You know these:

• From combustion to electric

• From hardware to software

• From human driving to autonomous

Each one is complex. All three at once? That's a massive challenge.

And yet, some companies are handling it.

So why are traditional automakers struggling?

The +1 Transformation: From Hardware to Software-First Company

The real problem runs deeper.

We need to replace our entire operating system. I mean: How we work. How we decide. How we're organized.

This is the fourth transformation. The organizational one. The cultural one.

The old system was built for a stable world. For hardware. For predictable cycles. For central control.

But the world isn't stable anymore. It's volatile. Digital. Decentralized.

The old system no longer fits the new reality.

But why software-first?

Cars are about getting from A to B, right? Do we really need software for that?

Why Software Decides Everything

"Software is eating the world." We've seen this in music, consumer electronics, photography, and retail.

Now it's happening with cars.

Don't get me wrong: Hardware still matters. But software becomes the key differentiator. The competitive advantage. The reason people buy.

Here's where many get it wrong: They think software means infotainment. Apps. Displays.

But software is much more. It's a new way of thinking about products.

The car becomes a platform. It's connected. It gets updates. It learns. It drives itself. It becomes part of your digital life.

Software enables all three technological transformations.

And it determines who wins.

Why? Markets are drifting apart. The "world car" is dead. China, Europe, USA, emerging markets. All have different expectations.

Try solving that with hardware? You've already lost. Too slow. Too expensive.

Market customization now happens through software. Not hardware variants.

And that's why the fourth transformation matters so much.

What the Numbers Say

The Gartner Digital Automaker Index measures how ready automakers are for this future.

The results:

1) Tesla: 79.3%

2) Nio: 76.9%

3) Xiaomi: 72.5%

...

13) Mercedes: 37%

14) BMW: 36.9%

16) VW: 34.8%

By region:

China: 53%. USA: 50%. Europe: 33%.

But here's the most important number: 0.88

That's the correlation between "Software-first Organization" and "Software-first Vehicle".

In other words: Your product is only as good as your organization.

The wrong organization will slow down any transformation. Or kills it completely.

And there's another pattern: The top 5 are all led by their founders. Founders with tech backgrounds. Who built software companies before.

Traditional automakers? Their boards are homogeneous. Professional managers. Mostly mechanical engineers. No software mindset.

What Steve Jobs Already Knew in 1995

In an interview, Steve Jobs talked about IBM. Back then, one of the world's largest tech companies.

His diagnosis: "Companies get confused that the process is the content."

What does that mean?

Companies create processes to replicate success. That makes sense.

But as they grow, something happens:

They start believing the processes are the secret sauce. They forget the actual goal: The product. And the experience.

The processes get more detailed. They regulate everything. They become the organization's operating system.

Eventually, people forget why these processes even exist. What the original goal was.

Processes get followed. Because "that's how we do it". Because "that's how it's always been".

The process becomes the goal. Not the result. Not the product.

Steve said: "IBM has the best process people in the world. They just forgot about the content."

Here's the crazy part:

This interview is 30 years old. And it describes exactly what's happening to traditional automakers today.

They're not fighting technology. They're fighting themselves. Fighting their inability to change.

You See This Everywhere in Traditional Automotive Companies

1. Nobody Wants or Can Decide

The culture is extremely risk-averse. Every decision gets pushed up.

One committee prepares for the next committee. Then the next. And the next.

For each level, the content must be reframed. So the next level understands what it's about.

Result: Small decisions eat up massive resources. And take months.

2. Everyone Sits in Meetings, Nobody Works

Most time goes to alignment. To reporting. To politics.

That's why a startup with 40 people achieves the same as an OEM with 400.

Despite all the processes, people still spend all day communicating.

Why? Organizations got too big. Responsibilities overlap. Nobody has full authority. Everything needs consensus. Every decision requires dozens of stakeholders.

Jeff Bezos put it this way: "Communication is a sign of dysfunction. We should be trying to figure out ways for teams to communicate less with each other, not more."

3. The Ownership Propaganda

We demand entrepreneurship. Employees should take ownership. Decide more.

But in reality?

Procurement decides on suppliers. Controlling decides on budgets. IT decides on tools.

Responsibility for the result? That stays with the team.

CARIAD is the perfect example. They got full software responsibility for Volkswagen. But no decision-making power. No ownership. The result? Failure.

It's a culture of distrust. Employees get squeezed into tight processes. They can't make any real decisions.

Companies demand ownership. But make it impossible.

4. The Zero-Mistake Culture

Risk avoidance is deeply rooted in the culture. Mistakes carry huge stigma.

Companies say they embrace failure. But they don't.

The safest career path? Don't make mistakes. You'll get promoted by default.

This breeds a culture where nobody takes risks. Nobody has new ideas. Nobody questions anything. That's what gets rewarded.

After Dieselgate, VW added so many compliance rules that innovation became nearly impossible.

Understandable. But fatal.

The result: Better to delay a year than risk a "wrong" decision.

The Apple Way

In another interview, Steve Jobs was asked how many committees Apple has.

His answer: "Zero."

"We are organized like a startup. We're the biggest startup on the planet."

His principle:

• One weekly 3-hour meeting for the entire leadership team

• Clear responsibilities instead of endless committees

• Decisions made by those doing the work

As Steve explained: "One person is in charge of iPhone OS. One person is in charge of Mac hardware. One person is in charge of worldwide marketing."

The key: It's always one person. That person can and should decide.

This only works with trust. Not control.

"If you want to hire great people and have them stay working for you, you have to let them make a lot of decisions."

And: "You have to run on ideas, not hierarchy. The best ideas have to win."

At traditional automakers? It's not the idea that matters. It's who presents it.

And those who question? Who are uncomfortable? They're immediately filtered out in the current operating system.

And Tesla?

Tesla ranked #1 in the Gartner study. They have a crucial advantage: They never had to transform.

Tesla was built as a software company from day one. Not as an automaker trying to learn software.

No century-old structures. No hardware culture. No old-school middle management.

Why Can't We Just Become Like Apple and Tesla?

Here's the hard part. Even if leadership makes the right call, change often fails at the organization itself.

More precisely: At middle management. Not all of them. But many.

They have the most to lose. Their power comes from old structures. From processes. From committees. From hierarchies and relationships.

Many actively block change. To keep their power. Out of convenience. Some just want an easy ride until retirement.

Companies recognize that fundamental change is necessary. But they can't implement it.

Because the people who need to execute the change are the same ones it threatens most.

My Take

After preparing for Stellantis, something became clearer:

The three technological transformations are difficult. But solvable.

Technology can be developed. Bought. Or acquired through partnerships.

The fourth transformation doesn't fail because of technology. It fails because of the existing operating system. And the resistance from people who benefit from the old one.

As long as we can't replace the operating system, transformation will fail.

This means: Different power. Different decisions. Different culture. Different leaders.

A new way of thinking. A new mindset. More trust. Less control. More willingness to take risks.

And yes: Removing those who block change.

After this transformation, your company won't look anything like it does today.

That's not failure. That's success.

That's all for today.

Feel free to reply to this email with your thoughts.

Until next week,
— Philipp

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