Globally, the number of on-road vehicles that were available in the year 2022 was close to 1.5 billion. Out of these, Asia recorded almost one-third of the share, recording close to 550 million vehicles on-road. Europe and North America followed the rank, taking the second and third place respectively with about 400 million and 350 million vehicles on road respectively. On the other hand, the United States Center for Disease Control and Prevention (CDC), globally 1.35 million were killed each year on roadways, while 3700 people were killed every day worldwide as a result of crashes from cars, buses, motorcycles, bicycles, pedestrians, or trucks (see Figure 1).
Vehicle fleet around the globe is growing at a rapid pace, and so is the concern for vehicular fatalities. These concerns have raised the need amongst the government to take numerous stringent measures to curb the issue as crash injuries are known to occupy a major share of the economic burden, especially in the low- and middle-income countries (LMICs). For instance, the CDC estimated that between 2015 and 2030, the LMICs would experience economic losses of about USD 834 billion dollars as a result of fatal and non-fatal crash injuries. Recently, the World Health Organization (WHO) had also released a road safety technical package, known as “Save LIVES” which lays down a proforma for governments and businesses so that they can take measures upon speed management, vehicle safety standards, and infrastructure design and improvement among others.
However, business organizations, such as Google Inc., subsidiary of Alphabet Inc., had in turn, taken this as an opportunity and developed the Google Self-Driving Car Project, currently known as Waymo LLC, which is also another subsidiary of Alphabet Inc. and a commercial self-driving taxi services provider, using the self-driving technology developed by Google X lab of Google. Despite the numerous opportunities that lies ahead with autonomous vehicles, which is also known for transforming mobility in the 21st century, the biggest question that lies ahead for businesses is if this seems to be another great opportunity for the automobile manufacturers. Research Nester analyzes how vehicle OEMs can grab the numerous opportunities that lies ahead in regards to self-driving cars by the end of 2035.
A self-driving car (also called an autonomous car or driverless car) uses artificial intelligence (AI), IoT devices, and supporting software to cover distances without much human supervision. This futuristic-sounding automotive may be able to drive itself to any pre-determined location, but it still requires the presence of a human being ready to take control. A truly autonomous car with a mind of its own, able to decide on the destination and the route, and exercise caution within the lanes, will be a commonplace occurrence in the coming decades.
A recent survey conducted by Research Nester revealed that over 55% of global respondents were okay with riding in a fully self-driving vehicle. The numbers were higher in emerging markets such as China, India, and the United Arab Emirates, and the least in countries like Japan and Germany. The Society of Automotive Engineers (SAE) has identified 6 levels of automation in driving which have been accepted by the U.S. Department of Transportation as ranging from Level 0 (fully manual) to Level 5 (fully autonomous). Here they are –
Despite of the several obstacles associated with self-driving cars, governments and businesses are collaborating to develop transportation infrastructure that integrates artificial intelligence in automotive and self-driving technology. Self-driving pilot initiatives are being launched in many places such as Singapore, Sweden, South Korea, and the US to build confidence in both the public and private sectors regarding the efficacy of this new technology. On the other hand, several initiatives are being planned and implemented across nations globally, which provides a major outlook to the adoption of these autonomous vehicles in the future. Here is a glimpse of some of the initiatives taken worldwide on adoption of self-driving cars and its vehicle safety:
The global market for self-driving cars, as estimated by Research Nester is to reach beyond USD 64 billion by the end of 2035 by growing at a steady CAGR of ~13% during the forecast period of 2023 and 2035. The expected value is to increase from the market value of nearly USD 22 billion in 2022. Moreover, the market is surrounded by several key players some of which include Autoliv Inc. (Stockholm, Sweden), Baidu (Beijing, China), AutoX, Inc. (California, US), Volvo (Gothenburg, Sweden), HYUNDAI MOTOR GROUP (Seoul, South Korea), Aptiv (Dublin, Ireland), Daimler AG (Stuttgart, Germany), and others.
On the other hand, auto manufacturing companies are entering into strategic partnerships with their competitors and tech companies to launch new and improved self-driving vehicles. For instance, Honda is collaborating with GM and its subsidiary Cruise to manufacture self-driving cars. The companies have already invested over USD 700 million and plan to spend about USD 1.5 billion over the next few years. Here is a glimpse of the different markets that are associated with self-driving cars (see Figure 2).
The future of self-driving cars by the end of 2035 is definitely going to give vehicle OEMs as well as other manufacturers associated with these technologies, several opportunities for growth. With end number of research and innovation that has gone into self-driving technology over the years, the smart mobility solution has a long way to go. Rising participation from regulatory bodies, industry associations, and the governmental support, all are expected to help vehicle OEMs of self-driving cars touch new heights. Moreover, vehicle OEMs are also shifting their focus from passenger segment to commercial segment, which is also expected to generate several investment opportunities for business organizations. For instance, the Government of the United Kingdom has recently announced that in association with industries, it has funded close to USD 98 Million to commercial self-driving passenger and freight services providers (see Figure 3). All in all, the transition for conventional vehicle manufacturers to manufacture autonomous vehicles is not much challenging. Despite the growing competition in the field, OEMs can still catch up to their competitors by creating a bold strategy and executing it at the earliest, without further missing out on any other opportunities.