Although we are still years away from full maturation of the AV market, the future is here. Self-driving vehicles are hitting public roads, testing new automated driving software. While developers are still perfecting their technology, huge strides are being made in autonomous vehicles. In fact, Intel and Strategy Analytics estimate that the industry will be worth $7 trillion by 2050. And, with the cost of technology dropping, they could be commercially available sooner than you expect. This leaves many investors like myself asking, what does the future hold for autonomous vehicles?
Who is Leading Autonomous Vehicle Technologies?
Three AV Developers to Watch
If you have been following the news, there are some exciting advancements happening with AV technology. However, there have also been several deaths during beta testing and an unfortunate accident involving a pedestrian. So, industry watchdogs are calling for stricter safety standards to ensure they operate safely. As developers continue to improve their AV technologies, here are three companies to watch.
1. Alphabet inc. (Nasdaq: Goog and googl)
What first started as Google’s pet project has grown into one of the industry leaders. Waymo first launched in 2018. Since then, it has logged millions of miles with its autonomous vehicles. On average, the data shows that their cars can complete 13,219 miles in automated mode before needing manual intervention. With a combination of sensors, short-range lasers, radar, and lidar technology, their vehicles have a 360-degree view that can detect and track moving objects in a 300-meter radius.
Now, they even operate a fully driverless fleet of vehicles in the Phoenix area. Through the Waymo One app, users can now call for a car that does not require a human driver. While safety remains a huge concern, Waymo is forging ahead. In addition to their self-driving ride-share program, it also hopes to break into local and long-distance transportation.
2. Tesla Inc. (Nasdaq: TSLA)
Company CEO Elon Musk has made several ambitious claims about Tesla’s Level 2 AV technology. He hopes to transform the driving industry with the addition of its Autopilot feature to electric vehicles. Although they have yet to use lidar technology, it utilizes cameras, radar and ultrasonic sensors in conjunction with it software and computing platform.
They have also been testing a beta version of its Full Self Driving (FSD) on public roads. Select customers can also purchase it, creating an even larger pool of software testers. However, recent tragedies have brought a harsher look upon the program’s safety features and protocols.
3. XPeng Inc. (Nasdaq: adr, NYSE: xpev)
This EV maker, backed by Alibaba, has made several announcements that pose a serious threat to its competitors. During a recent press event, XPeng sent a fleet of 15 sedans on an eight-day trip along the eastern coast of China. After completing the 3,600 km (1,864 miles) trek, executives claim it surpasses Tesla’s Autopilot software in several areas.
Just this week, XPeng also showcased their newest model at the Shanghai Auto Show. The P5 will be the world’s first smart EV to include its automotive-grade lidar tech. Its XPILOT 3.5 autonomous driving technology has a total of 32 sensors. It incorporates 2 lidar systems, 5 mm-wave radars, 12 ultrasonic sensors, and 13 high-res cameras. Although pricing is not yet available, you can be certain it will be a major player in international AV markets.
What Safety Concerns Exist for Autonomous Vehicles?
Despite recent safety failures, manufacturers hold that automated vehicles are statistically safer than human drivers. They claim this technology will reduce fatal car crashes by removing human elements like negligence, drowsiness, and drunk driving. However, several fatal crashes involving pedestrians and onboard operators leave consumers skeptical.
Statistics show that most accidents involving autonomous vehicles are the result of other drivers’ failure to follow traffic laws. However, industry watchdogs like the National Transportation Safety Board and the National Highway Traffic Safety Administration are calling for more accountability. Many want to impose stricter standards that require AV pilot software to outperform human drivers. They want the software to incorporate more intelligent technology to improve decision-making, detection, and response to other drivers.
Other unpredictable factors create significant safety threats as well. Weather conditions, poor infrastructure, traffic congestion, and the behavior of other drivers are just a few that come to mind. In many instances, AV systems still require an onboard pilot to take manual control when reacting to unexpected environmental factors.
What Does the Future Hold for Autonomous Vehicles?
The million-dollar question for investors is what the future looks like for autonomous vehicles. Although no one has a crystal ball, experts can offer insights into how this technology could transform our lives. In his research brief “Autonomous Vehicles, Mobility, and Employment Policy: the Roads Ahead,” MIT professor John Leonard takes a hard look at AV technologies. He discusses both the current progress that has been made and future applications as the software becomes more reliable.
Current AV Technologies
Presently, most operating systems would best be described as driver assistance. While there are many more Level 2 and Level 3 automated vehicles, most still need a human driver on board. Leonard believes it will likely be another decade before fully automated Level 4 vehicles become widespread.
However, you can be certain that manufacturers will be racing to perfect technologies after Amazon, FedEx, and UPS committed to electrifying their fleet of delivery trucks.
The Future of Autonomous Vehicles
AV technology could potentially be one of the biggest technological breakthroughs of our generation. It has limitless applications in several industries such as trucking, delivery, and rideshare services. However, its success will be largely dependent on consumers’ acceptance of electric cars and driverless technology. You can be certain though that affordability and government incentives will speed up the transition.
It will also have a huge impact on the job markets and labor requirements to support the new technology. Although some fear it will reduce the number of human jobs, developers believe that it will merely change the nature of the jobs they need. With proper workforce training, the driving and transportation workers will be able to transition into support services. While much is left to speculation still, there will be a huge demand for technical and maintenance staff, call center and dispatch operators, and engineers.
The growth and application of AV technology will likely be a gradual expansion on a regional basis. Once developers determine when and where it will be most profitable, they will continue to target specific types of transportation. However, a slow rollout will probably be the most effective way to gain consumer acceptance. Not only will it allow manufacturers to improve the safety features, but it will also help ease critics’ concerns.