Self-driving cars no longer belong to the sci-fi realm of The Jetsons as Google’s prototype shows. In fact, research today says they hold huge market potential although they’re not likely to be completely autonomous anytime soon.
In 2030, they’ll create an $87 billion opportunity for carmakers and technology developers, with software emerging as the biggest winner, says a report by Lux Research, a Boston-based technology research firm. Cars with relatively modest “Level 2″ features such as adaptive cruise control, lane departure warning and collision avoidance braking, will then account for 92% of autonomous vehicles.
More advanced “Level 3″ cars that use high-resolution maps — as demonstrated by Google and Mercedes Benz — will gain only an 8% share, but no fully autonomous “Level 4″ car will likely be on the road in 2030, the report says.
The market is already taking root, said lead author Cosmin Laslau, a Lux analyst. He says sensor hardware specialists like Velodyne Lidar are developing products with unprecedented resolution while software and big-data giants like IBM and Google are launching partnerships. “Even mapping and connectivity experts like Nokia and Cisco are throwing their hats into the ring,” he said.
Yet the field is ripe with uncertainty, much of which may have more to do with public policy and consumer attitudes than with technology, according to industry leaders who spoke earlier this month at a symposium on “connected cars” in Washington, D.C., that was hosted for the Information Technology Industry Council.
“We’re at the beginning of the beginning,” said Harry Lightsey, executive director of General Motors’ Global Connected Consumer. He said there’s an “abundance of new technologies” but it’s difficult to say how the industry will evolve.
“You have a lot of different players in this space. … We’re still figuring it out,” said Jason Harrison, director of AT&T’s Emerging Enterprises and Partnerships, noting his company is launching a 4G-enabled car.
Hillary Cain, Toyota’s director of Tech and Innovation Policy, said the lack of legislation and regulation on how self-driving cars will be governed is a hurdle. “Until we know what the rules of the road will be,” she said, “it’s hard to move forward.”
The Lux analysis expects the United States and Europe will initially lead the autonomous vehicle market, but China will grow its share quickly to claim 35% of the 120 million cars sold in 2030. It projects China’s revenue of $24 billion will then eclipse $21 billion for the U.S. market. For automakers, it says software will be a key differentiator and crucial safety tool.
“True autonomy remains elusive,” the report says. “In spite of the tremendous hype around driverless vehicles, a vehicle that can truly drive itself in all conditions will not be on the road by 2030 in the likely scenario.”
This article can also be found in USA Today.