This business and in every day matters a little hype is okay. When it comes to matters such as this it is a little disingenuous because words are flippantly thrown around. When someone says autonomous, when someone says auto pilot, when someone says selfdriving what a consumer thinks is i come out of my home, i hit a button, and that car will take me anywhere in america at any time under any conditions. And i think as we all know thats not the case. If you go to some of the tests being done in pittsburgh the headlines says Autonomous Cars roving pittsburgh. It doesnt tell you there are two engineers in the car and at least four to five interruptions. These things are fine. The new technology is emerging and coming on but if we over hype and over stimulate the customer will have an expectation and when it is not met there will be a lack of trust and then a problem. I think it is true with the consumer and also the government. The governments point of view is if we start making these proclamations that arent true or dont manifest themselves in the market issue well have an issue. What we want is the technology to match Customer Expectations aligned with government regulation and then you have it. The reason im sensitive to this is i think this is breathtakingly cool technology. When i entered this business in 19931994 never could i have imagined in my wildest dreams as i have been the last seven or eight years inside a car thats blasting around a race track with no one behind the wheel, driving from stanford to las vegas which we did a couple years ago almost 600 miles fully autonomous, its here. E just have to communicate what is real, what the possibilities are, and how long it is going to take. My fear of over hype is well curtail the full potential. Imple as that. Host where is audi on the trail to fully Autonomous Cars . Coig a number of things. We are first and foremost a crazy pioneering company. Weve been that way. Audi didnt just wake up yesterday and decide to get into the autonomous business. Weve been doing this for over a decade. We started in 2005 with stanford and an autonomous challenge which we won back then. It led to 2009 racing in the desert, 2010 up to pikes peak. January of 2015 we drove from stanford to las vegas. Weve been around race tracks at high speeds. Its been a long effort. If you want to see where i see the world it sits in two camps to define a complicated thing simplistically. There will be a camp that is continuing to it rate and bring more advanced technologies into the market place. So the society of automotive engineers, they look at this combination of assist to full automation from zero to five. Zero is the model t, absolutely nothing on it. Level one is assist technologies. We have had these technologies in a car for probably 15 years. Adaptive cruise systems, break guard systems, turn assist systems. Customers buy them. You look at our a6 and a7, 60 to 70 of the cars we sell have the level one technologies on them. Now, we Just Launched six, seven, eight, nine months ago a4 and q7. This is level two. There are other manufacture thears have level two as well. Our definition is you have all of those assist features. You have some beginnings of getting into autonomous features. Right now we call it traffic jam assist. Its intended for traffic jams. You still have to be piloting the car. You still have to be sitting behind the wheel. And it lets you in the right circumstances take your hand off the wheel for approximately 15 seconds. I admit this is just the start of the technology. On the q7s we sell which is right behind me approximately 25 of the q7s customers paying 2300, 2400 have this technology on them. This to me is what the automotive be is does. We bring technologies. We promote them to a consumer, and the consumer pays based on whether they see the value. Our next step is going to be a8 which will be coming potentially next year. And this will be whats called level three. And the simple definition of that is youre going to get the speeds up to approximately 35 miles per hour. Youll allow it in the right conditions to have your hands off the wheel dramatically longer than 15 seconds. This is what we call traffic jam pilot. Again, still below 35 miles per hour. And this is where youll start to see more adappings. Now, that is what i call the automotive world. Continue to launch technologies and make it better with each generation. The second phase i see as well called the kennedy lets go to the moon, moon shot phase. This is level five. Fully autonomous. In almost all circumstances. In parallel fashion we are also working on that as well. I think those applications would probably confine themselves to more of a restrictive urban environment at least at the beginning and thats the two worlds. Well continue to bring the consumer along on this technology. Level three, well the first manufacturer with that in the a8 and also work on what we call the moon shot, fully autonomous. No one behind the wheel. Just someone getting around in this vehicle. Thats where we are and we believe 100 in this technology which is why were so aggressively pursuing it. Host some Car Companies have said 2020, 2025 for a level five. Is that optimistic . Mr. Keogh i think 2025 is not too bad. I think 2020 could be optimistic. When you start to peel this onion a little more, what exactly theyre talking about usually has a lot of wiggle room in there. In our minds, look. Sometime in 2018 well bring level three. We think well be able to bring lets call it level three plus which would allow higher speeds that would probably come in a 202021 window. You could see a space in 2025 where you have fully autonomous but my definition of fully autonomous would be in a confined area. The city of San Francisco or the island of manhattan. I dont see 2025 anywhere in america any time hit a button i can go there. I think there is far too much complexity, mapping, a lot of roads in america and on and on. But i think the important thing to look at and the way i view it is everyone is always essing to what ill call the 0. 2 scenario, the 0. 3 scenario. The truth of the matter is what people dont like about driving is congested areas in major city rotting in traffic. That is what we are attacking right off the bat. We see a lot of people that like to drive on open roads, like to cruise around their neighborhoods, like to do those types of things, and thats why we feel this is the way to go. Lets address the major issues. The major issue is traffic and what comes of traffic as we all know . Like all human endeavors, humans get bored. They can easily get distracted. Thats when they grab the phone. Thats when they grab something. Thats when something bad happens. And the other thing i like to think about is, you know, you can drive a car to your commute an hour and 15 minutes each way. And for one hour, 14 minutes, and 48 seconds, you can be dialed in, hand behind the wheel dialed in. One second, onehalf second, one split second you can look away. You can look at a phone. And you can pay with you and your familys life. Why would we not be thinking of these technologies that are there . We can bring them. That can mitigate that. Thats what were looking to do. Host you mentioned a level two package on this a7, 2400 is the cost. Mr. Keogh yes. Host are you recouping your investment or is there a subsidy there . Mr. Keogh truth be told what happens in the automotive business is you have a lot of high invest up front and then of course you get that back as youre able to scale it over a host of models. Right now on this car at 2400 probably not but as a q7 morphs into an a4 that morphs into an a5, covers 20,000 units, next year covers a hundred thousand units, then the answer is quickly yes. We do believe investing in the front end is going to give you this competitive advantage and then you scale the competitive advantage. But back to your original question, you can only scale the competitive advantage if a consumer wants the technology. So this is a bet were making. We believe the consumers do. So far they do. And we feel good about it. The other thing i think is crucial, though, and this is a nice advantage that we have being in the luxury segment and being audi is we do command price premiums. We command higher pricing. The type of people who purchase our cars are highly educated. These are people who are affluent and people who want the latest and greatest technology. So its little easier for us being in our position with our demographic and the mindset, you know, we are really a Creative Class brand if you will. People want the latest and greatest. Audis mantra is sort of high tech meets high design meets the times stow works for us. A volume oriented brand with a more pragmatic, strictly value oriented customer, its going to be a little bit tougher without a doubt. Host in the recent guidelines on Autonomous Vehicles from ntsa, as we go into that direction, data recording and sharing, is that something that audi supports . Mr. Keogh if you look at their latest guidelines it was 116 pages and a lot of governmental stuff. This is not a criticism but it is a lot to digest. Im going to zoom up at the higher level and of course like all government things you like to pick out the things that you agree with and like. So if i take the high level stuff, which i think was quite good, first and foremost, the government could have said, we dont believe in this technology and lets stop doing it. They could have said that and they did not. They said we believe in this technology right off the bat. So we like that. The second thing they said is we want to get behind innovation. We love that. The third thing thats crucial for us that they did write in there, it would be really helpful to get federal regulations aligned with independent state regulations on this issue because, of course, our disire desire is to launch one car with one technology set, one regulation, and sell the car throughout the United States. As you look at it right now you have examples like new york that say you always have to have one hand on the wheel for example. When we did our test in florida and did our state test in nevada and did our states in california, we had to get a distinct and different license for each one of these states and, of course, as a consumer there is no way in the world you want to be driving a semiautonomous vehicle and have a different license for a state that you cross. I think we have to get these things cleared. The final piece of the puzzle has to do a little bit with the campaign and a little bit of america in general lets say is we do need to invest, no joke, in the infrastructure. Because in my strong opinion the better the infrastructure, the greater leverageable advantage america can take in this technology. We can position ourselves that this is the place where autonomous and piloted is coming to life. This will bring the new business model. This will bring the high tech jobs. This will bring all the things we theoretically all want, republican or democrat. So we need well paved roads. We need well marked roads. We need well lit roads. We need well divided roads. We need well labeled parks. All the things Consumers Want and bring jobs and has a knock down effect of making a more hospitable place for autonomous driving. These are crucial things. I did see that in the 116 pages. Of course there was a lot more detail in there but i think it is heading in the right direction. We do applaud and we do recognize what the government has done. Its moving forward on this, which is cool. Host you just spoke about infrastructure. Does that lend itself to connected cars . Mr. Keogh obviously it does as well because when you start to talk about infrastructure, you can give a more expansive definition of infrastructure. When you get to what youre saying, there is the hard infrastructure, which is the road and the markings and all of that but then once you start to connect infrastructure, and a simplistic example, weve shown the technology, weve demonstrated a technology called traffic light online, a pretty slick piece of technology that in your m. M. I. Or instrument cluster if you will, you can see the light. You can see when its going to turn red, when its going to turn green. How many seconds it is going to take to do that. Now, this is simple stuff right now but fast forward to where this could go. Lets say its linked to your Autonomous Car. It can start to slow down the car knowing that there is a red light pending. This can save fuel without a doubt. It can also be much more efficient on traffic flow. You look at traffic flow and being someone from long island who grew up on the long island expressway, one brake tap, whether due to looking at a phone or due to being distracted can then spiral back to 70 cars. You get more traffic just from inefficient flow and brake tapping. All of that stuff could go away when you start to get to the infrastructure. I think the other future state and again, were looking way out, is the start connects not only to the infrastructure in the city but start to connect not only to infrastructure in the city but car to car. Not just audis but all cars. Imagine the level of intelligence that could come if all that information was put up into a cloud and then accessed where applicable. You want to talk the be traffic reports and you get a traffic report from 400 million cars out on the u. S. Roads that would be one precise traffic report. Youd know about pot holes, a whole assortment of things. And again, it can get there but that is a connected data world that can make things a lot smarter. Another example, and again, futuristic, but its there if you look at cities and look at the issue with parking, think how bloody, inefficient it is to go to a parking. You come in. You might have just passed the spot thats going to open. You circle around five decks of parking burning fuel, wasting time, co2 and then come back around. That spot may be taken. Then you go back up. If you get into an autonomous, connected world you know exactly where that parking spot is whether there is or isnt one and go directly there. The other thing is get yourself out of the car. You get 30 to 40 tighter parking in these things. More cars in there because you dont have to open doors. There is a lot of opportunity with this technology. Again, im optimistic. Host whats going on in germany with autonomous, connected cars . Mr. Keogh i think very similar things. Honestly what happened is a lot of the Technology Particularly for audi and i think a lot of brands you experienced it with uber in pittsburgh, people experienced it with the other manufacturers, a lot of the work is happening here because, frankly, a lot of the sensors, a lot of the chips, a lot of the companies in Silicon Valley obviously doing what Silicon Valley does brilliantly, we get a piece of technology, they invest, and they move quickly. Develop, develop, develop. Its happening here. I think the rest of the world has been catching wind of all of the none administrations and press announcements and now europe is starting to come onboard. I think they have a very similar thing as well. They have lots of lets say government regulations written, some of them in the turn of the 20th century, some updated in 1950s. This really needs a thorough looking at. If you look a the European Union it gets more complicated as you know because its convoluted and complex as america can be i think it is a little bit easier here. I would put america in the lead on this stuff. One, because of the sensors, the data, the tech that we have, a lot of it from Silicon Valley. I think the second thing is the American Consumer is open to these types of things and hopefully we get a government and i think we do that gets onboard. Weve seen what obama has done. Weve seen what rosekind has done. I think there is an opportunity to blend this stuff and put america in the lead on something. But china is heading here as well. This is the holy grail. A lot of people are heading there. Host is audi working with other Car Companies on this technology or is this audi centric . Mr. Keogh oh, this is awed cien trick. I think where we would work with the companies is on the regulations and infrastructure. That is a common area where we mutually agree it needs to be there. Most of the technology were developing on our own. The only one we do have a partnership for the most part is a Mapping Company called here and it is jointly owned by b. M. W. , audi, and mercedes bens. If you look at the digitized future as you can imagine extremely accurate maps are going to become the holy grail. This is something that for one company to invest in probably would have been a little too expensive to scale it up and make it work and then only scale it to one brand so it is where the three brands got together. There are examples that make sense and are smart and i think if you look at a lot of the Chip Technology certainly some of that is shared whether from the nvidias of the world or the mobile eyes of the world and stuff like that but right now we are developing this because in my mind this is going to be a competitive enterprise like the automotive business is. Someone is going to come into a show and say, i want the best piloted or Autonomous Car there is and who has it. And when that conversation happens i want audi and we want audi to be at the top the list. Because i think what these technologies are going to do is cause a little bit of a reset in the market place. Someone today wants to buy a luxury car they say okay. Ill look at b. M. W. , mercedes, and audi and see what features they have. In the future someone could come in and say i want an Autonomous Car. That is going to cause a reset. If you dont have one youre off the list and if you do youre on and thats where we want to be. Host you write Software Companies actively aim to fail fast. They experiment in the real world to work out kinks as they go. This makes sense for those developing a smartphone operating system, but fine tuning on the fly isnt feasible in the automotive world. Mr. Keogh and obviously i wrote it and agree with itment look, the automotive business sometimes gets a bum rap. Its little bureaucratic, a little dog matich, people say, and a little slow to move, but the truth be told there is a lot of government regulation in the automotive business which there should be and the stakes are extremely high. A, number one we have peoples futures, lives, families. Theyre moving in vehicles going 65 to 70 miles per hour. Verything has to be right. Everything has to be right each and every time all the time for a long time. That sounds over stated but its not. When you hit that brake on a car 15 years from now in the middle of iowa with 120,000 miles on the car those brakes need to work. When a crash happens, those air bags need to go off 100 full stop. Now, if you just down loaded the latest i. O. S. Software and your email jams up or you get a flash code, okay. Reset. No problem. Get it back to life. No problem. Theres no real major life altering that is going to impact that. In the automotive business there is. So, yes. It may make us perceived as a little cautious. It may make us perceived as a little bit slower. But weve got to be right all of the time. And thats what we want to do. Host Cyber Security and privacyment weve all seen the reports on hacking and Cyber Security. What about with these cars as they develop more and more technology and more and more software . Mr. Keogh without a doubt this is a massive and big and robust issue. I do not think we have all of the answers. And, you know, without a doubt that is a top priority on our list. And our 100 stated goal is to bring technologies that are embraced by customers, embraced by government regulators, and secure and safe. Now, certainly im not going to go into specifics about what we are and are not doing but we sernl certainly recognize the challenge without a doubt. Host how did somebody who majored in comparative literature end up at a car company . Mr. Keogh a very good question. I majored in comparative literature. My ideal at the time was i was going to become a journalist for the New York Times working in latin america. That was my goal. I speak spanish. I wrote my thesis on latin american authors. And, of course, life takes a lot of turns. And one of the turns that it took in my career path was to get an opportunity to work for another german car company. I was living in new york city at the time and this company was up in new jersey. I said, you know what . Ill just work there for one year. Itll look good in my resume and be kind of exciting. They were looking for someone in the Digital Space and lo and behold one year turned into 24 years and here i am as president of audi. One of the things i like to say about my father, who is now 81, 82 years old. He bought an audi 100 ls in 1971, 1972. At the time, having a 100 ls in the streets of america with all of the cameros and dusters and country squires and all of the cars out there, this car was it. I always thought, man. What was my dad thinking buying an audi in the early 1970s . I loved the car and loved him and it just got in my mind with this brand and fast forward it makes me very proud to be here. Host have you found so far the federal government to be relatively passive when it comes to developing this technology . Mr. Keogh i wouldnt say passive is the right word. I would say highly engaged. Host encouraging . Mr. Keogh for me encouraging . Absolutely 100 encouraging. I know youve had mr. Rosekind on your program. Weve had him here in our offices. Weve met him at the Detroit Auto Show and had a number of conversations with him and meetings with the regulators. I think it is clear. Obama said and he wrote in his oped, by the way i like the way i was in the wall street journal and he was in the pittsburgh post gazette. But he said, we embrace this technology 100 . And the government regulations if you simplify them said we want to move forward. So i am encouraged and i have no reason yet to be discouraged. I think this is a technology if you take all the noise and all the drama aside, 90 to 94 of every accident that happens out there on the road is caused by human error. From distraction or miscalculation. A whole lot of that can be alleviated with this technology. Sensors are always on. Radar is always on. Theyre not looking at cell phones. Theyre not 17 years old holding their girlfriends hand. Theyre not talking to jimmy about when the next party is or whats going to happen. Theyre not spaced out with 20 kids yapping in the back coming out of the High School Prom. These sensors dont do that. There is no High School Prom for them, no twitter. This is on. And so i think that is the upside. If you look at it, its quite, you know, troubling accidents and fatalities are up i think 10 . There was just an article in the New York Times the other day. How can that be when we have all of these technologies in the car from seat belts to air bags to crumple zones to everything yet fatalities are up . Granted, slightly more miles are being driven but they are higher. Something is going on out there and i think this technology is a big, big help. No debate. Host finally, this is the end of your wall street journal oped. Whether you develop software or end metal or all auto makers now. Mr. Keogh this is a little ode. It seems to be the trending thing that everybody wants to get into the car business. Uber, rumors of apple with whatever theyre doing with project titan and google of course with an Autonomous Car and a host of other people. Frankly, in my mind, we love this. You know, the automotive business was sort of marginalized to the automotive page. Now were in the front page with the technology and government regulations, in the front page of the conversation. If you look at the big three thats causing that, you know, primary number one is the conversation that we had on autonomous and piloted. The second one is of course the regulations and the emergence of battery and what that will lead to. The third one is a changed business model. Youre looking in a place now with the ubers and say a subscriber based model versus a straight retail model which youve always been used to. You are going to see a profound amount of change in the automotive business over the coming years. Thats why i referenced so many players coming in. But i think basic truths wont go away. You need to have a strong brand, embrace Technology Like crazy, and need to embrace tomorrow, tomorrow, tomorrow. Dont defend the old world. Embrace the new world. Thats what were doing here even if it is a little challenging sometimes. Scott keogh is president of audi of america. The communicators has several recent programs on car technology. If youd like to see those and programs on other communications and Technology Topics go to cspan. Org. Cspan, where history unfolds daily. In 1979, cspan was created as a Public Service by americas Cable Television companies. And is brought to you today by your cable or satellite rovider. Every weekend book tv brings you 48 hours of nonfiction books and authors. Heres whats coming up this weekend. Tonight at 10 00 eastern, afterwards. Harvard University Economist examines the Historical Impact of immigration on the u. S. Economy in his book, we wanted workers, unraveling the immigration narrative. There is no doubt about the fact that when immigrants come in they do all kinds of things in the economy. One thing is they affect wages by basically reducing the wages of people who look like immigrants. The other thing is that itself creates gains. Think about it. Somebody is overweight, somebody offers higher profit. Eople who use immigrants win dramatically. Sunday, many questions of the universe are answered including how it began and the likelihood of intelligent life elsewhere in their book elcome to the universe, an astrophysical tour. In our book we calculate how you might go about finding xo planets that would be of particular interest to us and what it is youd be after . Not necessarily rings though rings are quite beautiful. Really at the end of the day youre after whether it can harbor life. Go to book tv. Org for the complete weekend schedule. On wednesday the Supreme Court heard oral argument in a case testing the constitutionality of a 1952 Immigration Law that makes it easier for unmarried mothers and unmarried fathers to pass u. S. Citizenship to their children born in other countries. This is an hour. Well hear argument this. Rning in case 151191 mr. Chief justice and may it please the court, the United States constitution does not confer u. S. Citizenship on anyone born outside the United States, whether facilitates Plenary Authority under article one of the constitution it is for congress to determine which categories such persons should be granted u. S. Citizenship by statute. In doing so congress has always required that the persons involved have a demonstrated d sufficient connection to the United States either in themselves or through their parents to warrant the citizenship because it carries with it attendant duties and rights on the part of the individual and important duties of protection and obligation on the part of the United States government. This case confirms the frame of the immigration act of 1952 as originally enacted for granting citizenship to persons outside the United States as of the day of their birth. Other provisions deal with the granting of citizenship later in life. Those who are open to respond but were not taken advantage of. In particular this case concerns the granting of citizenship to children born abroad, a ck situation in