Two prominent executives at companies building self-driving technologies recently offered their thoughts on the future of the autonomous car industry:
- Kevin Clark, CEO of Aptiv, formerly auto supplier Delphi, told Bloomberg that autonomous cars will arrive as part of commercial services next year, but it won’t be until around 2025 that market for consumer-owned vehicles develops. Aptiv is focused solely on connected and autonomous car technologies, following the company’s spinoff of its powertrain business. Commercial services providers, such as ride-hailing and parcel delivery companies, have long-term financial incentives to integrate autonomous cars into their fleets, even if the upfront price of the cars reaches $150,000. The per-mile operating cost of an autonomous car used as part of a ride-hailing service is only $0.17, significantly lower than the $1.05 it currently costs per mile to operate a manually driven car for a ride-hailing fleet. And McKinsey estimates that autonomous delivery vehicles with parcel lockers may cut delivery costs by up to 40%. However, Clark also argued that companies will reduce the cost of LiDAR, an image sensing technology that helps cars create a virtual image of the world around them, from around $100,000 to only $5,000 by 2025. Since LiDAR is often the most expensive tech component of an autonomous vehicle, this will lower the price of the cars enough to create a vibrant market for individual car buyers for the first time.
- Lyft’s chief strategy officer, Raj Kapoor, argued that the self-driving car market “will go through a gut-wrenching decade before there are clear winners and losers,” at the Built to Adapt conference hosted by software company Pivotal. He elaborated that the current lack of vehicle standards incentivizes companies to collaborate, since there aren’t yet any best practices for building a self-driving vehicle. Kapoor said this was the driving factor behind Lyft’s decision to work with Alphabet’s self-driving spinoff Waymo. However, Kapoor predicts that many companies currently working together will eventually come into fierce competition with one another. For instance, high-definition mapping could become an area of intense competition among self-driving players. Google Maps is the clear and long-standing market leader, but companies like Lyft can also collect loads of mapping data through autonomous vehicles. That data can be used to create high-definition maps for self-driving cars that are much more accurate than Google Maps, Kapoor said. In addition, as the partners for Lyft’s open autonomous car platform begin to deploy vehicles in the ride-hailing company’s network, they will be able to collect even more mapping data to bolster Lyft’s mapping platform. However, Google is already fighting back by improving the capabilities of the cameras equipped on Google Maps’ cars that could eventually be used by Waymo. These map the streets for its Google Maps StreetView setting, allowing them to capture more accurate details of the roads.
Both executives emphasized that we are still in the very early stages of the self-driving car market’s development. Clark, for instance, said the race to make self-driving technologies affordable for average consumers is “only in the first inning,” while Kapoor indicated that a brutal war between companies in the space will last nearly 10 years. Moreover, both executives’ comments indicate that the ripple effects of autonomous vehicles — from cost-savings for companies using the cars to the changes in consumers’ mobility habits the cars will bring — will be substantial even if competition in the market is steep.
Looking ahead, after the first handful of companies deploy self-driving cars in limited, confined settings, and the regulatory environment around these vehicles begins to take shape, companies will start to form blueprints for how they can compete in, and potentially dominate, the market for self-driving cars and autonomous mobility.
- Sizes the current and future self-driving car market, forecasting shipments and projecting installed base.
- Explains the current state of technology, regulation, and consumer perception.
- Analyzes how the development of autonomous cars will impact employment and the economy.
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