The overall autonomous driving market is expected to grow by $560 billion by 2035. This transformation will bring about significant efficiency gains and reduce externalities, especially accidents, congestion, and energy use.
Autonomous vehicles (AVs) offer a range of benefits to users and society. Accidents could fall by up to 70% per year, resulting in huge savings for the economy and welfare. Costs for users could fall by 35% as such vehicles would experience less wear and tear. Electric vehicles (widely expected as the standard for AVs) would be considerably more energy efficient, and connected cars could become even more efficient through platooning. Finally, insurance premiums could fall as the risks associated with accidents would be reduced.
A new analysis explores some of the broader impacts these efficiencies could have in the U.S. and around the world. The analysis by AT Kearney is part of the firm’s “How Automakers Can Survive in the Autonomous Era” report.
The economic benefits of autonomous vehicles could add $1.3 billion to the U.S. economy, including nearly $150 billion from reduced congestion, nearly $500 billion from the cars themselves, and nearly $500 billion from fewer accidents, while the technology could free up up to 1.9 trillion minutes of time.
The development of self-driving cars is by no means complete, and it could be up to 20 years of development before fully autonomous cars are widely available.
The market for AV vehicles is expected to be huge, with in-vehicle guidance, control, and communication systems estimated at $103 billion, mobile apps at $83 billion, and the market for the vehicles themselves predicted to reach up to $95 billion by the end of the 2020s.
The company predicts that the market will double to $560 billion between 2030 and 2035, or about 17% of the total automotive market.
The time currently spent traveling could be freed up to 4 trillion minutes by 2035.
The market remains relatively fragmented, with OEMs, big tech companies and others trying to establish themselves in the market, but there is often a different overall idea of what the market for autonomous vehicles looks like.
The next decade is expected to see a relatively rapid increase in technological advances, with different generations of autonomous vehicle technology expected to be released. These technologies tend to be considered driver-assist, in that they provide emergency support and other assistance to the driver while remaining seated in the driver’s seat. At the end of the development cycle, fully autonomous technology will only become a reality if it meets various criteria.
The study also notes that implementing this technology will require the achievement of a range of new standards, not just at the technical level but also to be integrated into broader public policy and regulatory frameworks. The introduction of driverless vehicles will also require the implementation of infrastructure to meet whatever requirements are imposed.
