By Ken Stewart
August 8, 2019
What happened to the promise of autonomous vehicles? AV’s have been the tech news darlings for some time with promises of fleets to use and cars to buy soon. It seems however, there is a hedging trend underway. Delays and repositioning are hardly the best ways to keep us excited at the prospects of climbing in our new car, announcing our intended destination and then sitting back to read a book as we travel.
- General Motors subsidiary Cruise, has postponed a planned launch of an autonomous ride-share service.
- Although sticking with his forecast of one million Teslas capable of being robo-taxis on the road by the end of next year, Tesla’s CEO Elon Musk is hedging, “We will still need regulatory approval, but the capability will be there.”
- Kristin Kolodge, Executive Director at J.D. Power concluded their recent research by saying, “It’s going to be around a decade-plus before that is going to be an option for consumers to purchase a self-driving vehicle.”
If the hype of the autonomous car has died down, has the development pace slowed down too?
Thankfully, no. The industry is simply maturing… right on schedule. It’s a good thing.
Funding sources are more particular
I wish I had a dollar for every Powerpoint presentation in the last several years from every start-up in the autonomy space promising great things, if they only had funding. I am not criticizing those companies, as that is how new initiatives start.
The bar to attract funding was set pretty low a few years ago but lately the economy is slowing and the industry is maturing. The private and corporate capital environment is more conservative and selective now. Funding is no longer willing to chase promises, as it is now chasing a company’s development capability and their prospects for creating strategic partnerships.
One key area that has quietly seen tremendous investment is in the field of Lidar sensing. More than $1 billion in corporate and private investment has gone into some 50 Lidar startups over the past three years, including a record $420 million in 2018 alone. Why? Lidar sensors are a key enabler for AVs, with innovation and technology development moving fast and partnerships developing quickly.
Sometimes the ultimate goal can move farther away from you
If one can engineer the situation, one can engineer the solution. Making an AV turn right at the street corner is easy. Making the car however, avoid a pedestrian walking his dog at that street corner on a snowy day as he decides to J-walk today is something different.
There are 8.8 billion road miles traveled every day in the US, full of unpredictable variables. We have all dealt with drivers that have acted as though traffic laws were merely suggestions. The realism of having to write code to handle random events has sunk in and the AV engineering is far enough along to where the “What if?” questions have really piled up.
It’s like knocking out a few walls in your house to get underway on a remodeling project only to find deeper problems that must be fixed first. Actually, it’s harder than that. Once a car can ‘drive itself’ safely you are not done. It has to perform properly every time even if the road situation changes from day to day. Once that is mastered, you are still not done. There needs to be certainty that the AV will perform properly every time. This requires validation and testing that is often way beyond the imagination of a company’s original tech outlined on those early Powerpoints.
No one can do it all without partnerships
Partnerships have been occurring, quietly, steadily and strategically. The music at the prom has been playing for a while now, and most of the attractive guests have picked their dance partners. Not only Tier 2 to Tier 1 suppliers and Tier 1 suppliers to OEMs, but now even rival OEMs are partnering:
- Ford and Volkswagen have reached an agreement to share electric and autonomous car technologies, extending their alliance well beyond commercial trucks.
- 1,200 developers at BMW and Daimler will team up to develop automated driving technology.
- Honda has partnered with Cruise and General Motors to fund and develop a high-volume purpose-built autonomous vehicle. Honda will contribute approximately $2.75 billion over the next 12 years.
Partnerships among OEMs are not new but previously they often focused on co-development of powertrains, subsystems or researching technologies with a limited scope. These modern partnerships are arguably broader, with huge implications in determining the ‘winners and losers’ among the future providers of personal transportation.
So, when can I get one?
Earlier this year, J.D. Power polled more than 100 auto and tech experts and more than 5,000 consumers as part of its first Mobility Confidence Index. That survey indicated that auto and tech industry experts predict that robo-taxis will not be ready for widespread public use until 2025. Moreover, it will be at least 12 years before fully autonomous vehicles are being sold to private buyers.
That same study indicated that consumers predict it will be close to a decade before self-driving vehicles are ready in a variety of uses. Fifteen years from now, we should expect autonomous vehicles to make up just 10% of all vehicles being bought and sold.
The takeaway is this; Engineering AVs to operate safely and reliably is probably the hardest thing to face automotive developers in the last 100 years. So, it will take more time than some industry watchers would like. The industry ‘do-ers’ are working very hard and very fast on the daunting problems facing autonomous vehicles. We should not measure their progress based on the headlines.
Sources: CNBC, Phil LeBeau referencing J.D. Power research. Reuters. GM Media.
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