Ten ways autonomous driving could
redefine the automotive world
The development of self-driving, or autonomous, vehicles is
accelerating. Here’s how they could affect consumers and companies.
Autonomous vehicles (AVs) represent a major innovation for the automotive industry,
but their potential impact with respect to timing, uptake, and penetration
remains hazy. While high levels of uncertainty currently surround the issue,
the ultimate role that AVs could play regarding the economy, mobility, and
society as a whole could be profound. In an effort to look beyond today’s
rapidly changing predictions on AV penetration, we interviewed more than 30
experts across Europe, the United States, and Asia and combined these findings
with our insights to arrive at ten thought-provoking potential implications of
self-driving cars.
The widespread use of AVs could
profoundly affect a variety of industry sectors. To explore these implications
in depth, we focused on three time horizons of AV diffusion: before such
vehicles are commercially available to individual buyers, when they are in the
early stage of adoption, and when they become the primary means of transport.
1.
Industrial fleets lead the way.
While it’s unlikely that any on-road
vehicles will feature “fully autonomous” drive technology in the short term
(for instance, by 2020–22), AVs are already a reality in selected applications
that feature controlled environments, such as mining and farming. In these
cases, the restricted nature of operations and the possibility to operate on
private roads facilitate adoption. Some of the benefits of autonomy in these
fields include labor-cost savings and the reduction in carbon dioxide (CO2)
emissions through optimized driving (shown to cut emissions by as much as 60
percent). Other adjacent equipment applications—for example, in the
construction and warehousing sectors—should see the next AV applications for
vehicles such as excavators, forklifts, and loaders.
In the medium term (through 2040),
on-highway trucks will likely be the first vehicles to feature the full
technology on public roads. Prototypes already exist, and companies are
currently developing the software algorithms needed to handle complex driving
situations. Long-term automated commercial fleets might include vehicles for
parcel delivery as well as automated drones, which multiple players are already
field-testing.
2.
Car OEMs face a decision.
Automakers worldwide will likely
define and communicate their strategic position on AVs in the next two to three
years. We have identified four strategic stances they can assume when
introducing their autonomous-vehicle offerings:
- Premium incumbents.
Established premium players with extensive customer bases and strong
technical and commercial legacies will probably take an incremental
approach to AVs. This likely means they will gradually introduce
increasing levels of advanced driver-assistance systems (ADAS) in their
vehicles.
- Attackers.
New industry players developing “radically new” vehicle architectures—such
as high-tech giants, first-tier suppliers, and mobility operators—will
focus on the “accessible mobility” consumer segment to capture volumes
quickly and sustain ancillary business models.
- Fast followers.
These OEMs have significant technical and commercial legacies. They will
most likely invest in AV research and then wait for the vehicle-level
costs of the core technologies to drop while penetration in the premium
segments grows.
- Late entrants/nonadopters. As the name implies, these automakers will avoid
entering the AV market in the short to medium term.
3.
New mobility models emerge.
While OEMs are developing autonomous
vehicles, a variety of other transport-mobility innovations are already hitting
the road. Many of these take the form of pay-per-use models such as car
sharing, carpooling, “e-hailing” taxi alternatives, and peer-to-peer car
rentals. These plays are attracting investments and seeing impressive growth
rates. The e-hailing model in particular has experienced strong growth given
both annual investment funding and market penetration.
4.
The car-service landscape changes.
The proliferation of AVs could
represent an opportunity for car OEMs. As of 2014, for example, roughly 80
percent of the car-service shops in Germany were “independent” from OEMs. Given
the safety-critical nature of AV technologies, customers might strongly prefer
strict adherence to OEM service processes and the use of original service
equipment when it comes to maintaining and repairing AV systems. This could
imply a disadvantaged position for independent service providers unable to
afford AV-maintenance systems. Furthermore, our research shows that nearly 60
percent of customers would follow their smart cars’ recommendations for service
locations. Beyond the benefits of a bigger after-sales revenue stream, OEMs
will have a strong incentive to service these vehicles, since regulators could
ultimately force them to take on the greatest portion of the responsibility and
risk associated with crashes caused by AV technical failures.
5.
Car insurers might shift their business model.
Car insurers have always provided
consumer coverage in the event of accidents caused by human error. With
driverless vehicles, auto insurers might shift the core of their business model,
focusing mainly on insuring car manufacturers from liabilities from technical
failure of their AVs, as opposed to protecting private customers from risks
associated with human error in accidents. This change could transform the
insurance industry from its current focus on millions of private consumers to
one that involves a few OEMs and infrastructure operators, similar to insurance
for cruise lines and shipping companies.
6.
Companies could reshape their supply chains.
AV technologies could help to optimize
the industry supply chains and logistics operations of the future, as players
employ automation to increase efficiency and flexibility. AVs in combination
with smart technologies could reduce labor costs while boosting equipment and
facility productivity. What’s more, a fully automated and lean supply chain can
help reduce load sizes and stocks by leveraging smart distribution technologies
and smaller AVs.
7.
Drivers have more time for everything.
AVs could free as much as 50 minutes
a day for users, who will be able to spend traveling time working, relaxing, or
accessing entertainment. The time saved by commuters every day might add up
globally to a mind-blowing one billion hours—equivalent to twice the time it
took to build the Great Pyramid of Giza. It could also create a large pool of
value, potentially generating global digital-media revenues of €5 billion per
year for every additional minute people spend on the mobile Internet while in a
car.
8.
Parking becomes easier.
AVs could change the mobility
behavior of consumers, potentially reducing the need for parking space in the
United States by more than 5.7 billion square meters. Multiple factors would
contribute to the reduction in parking infrastructure. For example,
self-parking AVs do not require open-door space for dropping off passengers
when parked, allowing them to occupy parking spaces that are 15 percent
tighter.
9.
Accident rates drop.
By midcentury, the penetration of
AVs and other ADAS could ultimately cause vehicle crashes in the United States
to fall from second to ninth place in terms of their lethality ranking among
accident types. Today, car crashes have an enormous impact on the US economy.
For every person killed in a motor-vehicle accident, 8 are hospitalized, and
100 are treated and released from emergency rooms. The overall annual cost of
roadway crashes to the US economy was $212 billion in 2012. Taking that year as
an example, advanced ADAS and AVs reducing accidents by up to 90 percent would
have potentially saved about $190 billion.
10.
AVs accelerate robotics development for consumer applications.
The broad penetration of AVs will
likely accelerate the development of robotics for consumer applications
(including humanoid robots), since the two share many technologies. These
include remote advanced sensing, hyperprecise positioning/GPS, image
recognition, and advanced artificial intelligence. In addition to sharing
technology, AVs and robots could benefit from using the same infrastructure,
including recharging stations, service centers, and machine-to-machine
communication networks. These commonalities might push multiple players to
invest in both applications, as already shown by the significant investments in
robotics made by selected automakers and high-tech players.
In addition to transforming the
automotive industry, the rise of autonomous vehicles will likely have a
profound impact on society. The ten developments described here provide a
snapshot over the wide spectrum of possible outcomes linked to the increasing
penetration of AVs in the market, offering industry leaders a look forward at
this evolving landscape as it unfolds before them. Defining how to shape this
landscape effectively represents a significant strategic challenge for the
industry and regulatory authorities in the coming years.
| byMichele Bertoncello and Dominik
Wee
http://www.mckinsey.com/Insights/Automotive_and_Assembly/Ten_ways_autonomous_driving_could_redefine_the_automotive_world?cid=other-eml-alt-mip-mck-oth-1506
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