Study Says Autonomous Vehicles To Be $560B Industry in 20 Years

Autonomous vehicles are projected to become a $560 billion industry within 20 years, but several problematic issues need to be worked out first.

This was the finding of a report by consulting firm AT Kearney, which interviewed 150 executives from the technology, automotive, and communications industries surveying a broad array of issues facing the future of self-driving vehicles.

Interviewed executives expect it to take up to two decades for fully autonomous vehicles to emerge in the market. Cost savings are expected to be be substantial by reducing vehicle collisions, the study says, but a few legal issues will have to be resolved for this to happen, the study reported.

“While industry players have already developed or tested many of the technological building blocks, tough and tricky legal challenges remain, including new laws on accident liability, on where self-driving cars may operate, and on who may have a license,” the AT Kearney study said.

New traffic guidelines will also need to be developed. Interviewed executives predict that the incentives for establishing the right legal framework will be strong, with California taking the lead on creating a realistic legal framework, according to the study.

The benefits gained by transitioning over to the new technology will be historic, the study said. The consulting firm estimated huge savings will come from reducing accidents by 70 percent. Autonomous vehicles will also save fuel and ease traffic congestion on highways, which will produce substantial savings, Kearney said.

SEE ALSO: Autonomous Vehicle Technology Soundly Backed by Top Federal Regulator

One executive interviewed for the study encouraged automakers to create dedicated academies to train consumers on how to become comfortable with the concept of owning an autonomous vehicle.

Consumers will see a variety of artificial intelligence on the market, including drones and commuter vehicles. One interviewed executive said that “drones will be accepted by people who are not able to drive.”

The Kearney study concluded that not all automakers will be joining the emerging autonomous vehicle market.

“Manufacturers face hard questions as they jockey for position — from thinking about their value propositions, which core capabilities they need, and which players they should partner with, to developing business models that offer the best go-to-market strategies and the best chances to win,” the Kearney study said.

The Detroit Bureau