First-to-Market Battle May Prove Decisive for Autonomous Vehicles
September 21, 2016
Joshua Baca, Senior Vice President, Client Relations
As originally published in Real Clear Policy.
Autonomous Vehicles (AVs) are no longer a figment of science fiction. They are the future. The technology behind the biggest transportation market disruptor in decades is advancing rapidly, with the “first to market” battle well underway. As the legislative and regulatory challenges in this emerging market are sure to intensify, whichever company can avoid the obstacles and cross the finish line first may reap all of the rewards. We could be on the cusp of the next Model T.
Uber, in partnership with Volvo, is already deploying AVs on the streets of Pittsburgh. General Motors is working with Lyft on a fleet of driverless cars, and Ford has announced their AVs will be on the market by 2021. Foreign automakers are also looking to penetrate the U.S. market: Audi is testing AVs in Washington, D.C., and Toyota is pledging to spend over $22 million to develop driverless vehicles. Given the nature of AVs and the inherent loss of control on behalf of the “driver,” questions of trust, privacy, and safety will dominate the market.
In June 2016, DDC Public Affairs conducted an online survey of 500 registered voters, in partnership with our research partner Axis Research, to better understand the political environment surrounding AVs. Findings show that awareness of AVs is high at 89 percent, while support is much lower with only 24 percent feeling strongly that AVs are a good thing for the future. Soft support creates an opportunity for voters to be swayed in either direction, and, as such, both auto manufacturers and technology companies have some work to do in order to establish a strong base.
The survey also found the average makeup of AV supporters to be high-income men ages 35—54, who are also more likely to speak out on the issue. On the other hand, characteristics of the opposition include women over 55, who are less likely to speak out. This presents a challenge as a cornerstone argument for AVs is their promise to provide increased mobility for groups such as seniors and women — both of which are hesitant to buy into the technology, according to the survey.
When asked what companies voters trusted to bring this technology to the market, domestic automakers had the strongest support, with General Motors and Ford leading the pack. Comparatively, trust in foreign automakers and technology companies such as Google and Apple to develop this revolutionary technology was much lower. And ride-sharing companies Uber and Lyft, which have an increasingly visible stake in the industry, proved to be the least trusted entities, with only 9 and 5 percent of voter trust, respectively. The lack of independent support for ride-sharing companies only adds additional credence to the importance of their partnerships with auto manufactures.
Barring federal preemption, state and municipal laws and regulations will dictate how AVs for consumer use will be introduced and tested for the market. Seven states have enacted legislation or adopted regulations that govern the testing and use of AVs. These policies vary drastically, with some states, such as Michigan and Florida, seen as AV-friendly, while others, e.g., California, deemed much more restrictive. While 59 percent of survey respondents believe state officials should be welcoming of AVs to market, they also see a need for additional regulations and the ability for human passengers to take over control.
AVs have a promising future. Despite the possibility of increased mobility and safety and environmental benefits, the emerging industry faces major challenges. Insurance groups, labor unions and privacy groups are developing arguments against AV safety, highlighting pitfalls in the technology and actual market implementation. Our research shows voters are not yet convinced of the technology’s viability.
The AV industry was rocked when a recent report came out showing that autonomous technology was responsible for a fatal Tesla crash. An incident like that is exactly why average Americans are hesitant to embrace this futuristic technology. Removing the human element from the driving experience is a massive societal change; only time will tell if we are ready to embrace the accompanying challenges. In the meantime, the companies competing for this golden goose would be well advised to address the concerns of the general public and adapt accordingly.