Lux Research is an that offers strategic advice and ongoing intelligence about emerging technologies. In a recent report, independent research and advisory firm Lux Research said that there will be no truly autonomous cars on the road before 2030. However, developing the software and sensor systems needed to make those cars possible will be an $87 billion dollar opportunity for those who tackle the challenges and find the most successful solutions.
But first let’s define our terms. What is an autonomous car anyway? Here is how the National Highway Traffic Safety Administration (NHTSA) puts it:
- Level 0: The driver completely controls the vehicle at all times.
- Level 1: Individual vehicle controls are automated, such as electronic stability control or automatic braking.
- Level 2: At least two controls can be automated in unison, such as adaptive cruise control in combination with lane keeping.
- Level 3: The driver can fully cede control of all safety-critical functions in certain conditions. The car senses when conditions require the driver to retake control and provides a “sufficiently comfortable transition time” for the driver to do so.
- Level 4: The vehicle performs all safety-critical functions for the entire trip, with the driver not expected to control the vehicle at any time. As this vehicle would control all functions from start to stop, including all parking functions, it could include unoccupied cars.
So when Lux predicts there will be no autonomous cars on the market before 2030, they mean no Level 4 cars. In other words, there is a long way to go before the Google Car is more than just an adorable experiment.
Many cars today already qualify as Level 1 or Level 2 cars, because they offer electronic stability control, automatic braking adaptive cruise control and/or lane departure warning systems. Where Lux sees the greatest opportunity for growth is in making the leap from Level 2 to Level 3.
Lux predicts that Level 2 cars will be the norm in 15 years, but that Level 3 vehicles currently in development by Mercedes Benz, Volvo, Volkswagen and Toyota, among others, will account for only 8% of the market by then. They also predict that while the US and Europe will lead the way in creating this new technology, ultimately China will be the largest player in the self driving car market.
Cosmin Laslau, Lux senior research analyst and the lead author of the report entitled Set Autopilot for Profits: Capitalizing on the $87 Billion Self-driving Car Opportunity says:
“Today the autonomous vehicle value chain is already starting to take root, and it involves many players new to the industry. Sensor hardware specialists like Velodyne Lidar are developing products with unprecedented resolution. Software and big-data powerhouses like IBM and Google are striking up partnerships and even mapping and connectivity experts like Nokia and Cisco are throwing their hats into the ring.”
What the Lux Research report makes clear is that fully self driving cars are still a ways off yet but are definitely coming. Discovering how to build them will generate big profits for the nascent self driving car industry. One day in the not too distant future we may very well go over the river and through the woods to Grandmother’s house not in a sleigh, but in a car that knows the way.
How long do you think it will be before autonomous cars hit a critical mass?