Autonomous vehicles are reshaping the automotive industry
Autonomous vehicles have been taking the automotive industry by storm in the last couple of years. As autonomous-vehicle technology progresses from needing driver assistance to having full autonomy, driverless cars are looking more likely to become a reality. Automotive industry giants need to adapt in order to maintain their position in the future mobility value chain. Companies like Ford, Mercedes, Audi, Volkswagen, Toyota, General Motors, Tesla, and Google have already reiterated that driverless vehicles are the future.
Recent autonomous vehicle forecasts claim that there will be more than 30 million autonomous vehicles by 2040. Still, market analysts expect that the fully autonomous vehicle (level 5) market will only start rapidly picking up from 2030 onwards. Between 2021 to 2025, we can expect modest improvement with more and more OEMs commercially introducing their level 4 autonomous models to the market.
As more autonomous vehicles make their debut in the mainstream market, we can expect that there will be a shift to the concept of driving and transportation. These advances will change how people think about mobility in urban environments, with the greatest impact seen in car ownership and public transportation use. In fact, all the benefits that are being promoted by autonomous vehicle manufacturers are driving enormous interest and enthusiasm in the market.
Below are some of the key trends that we believe will drive the global autonomous vehicles market in the near future –
Emphasis on software instead of hardware
The automotive industry is becoming less and less driven by “hardware” (i.e. build material, quality, speed, performance), but more and more driven by “software”. Especially with the emergence of autonomous cars, we can expect consumers to treat cars more and more as functional assets instead of merely as status symbols or just a way to get to another place. Modern cars are expected to have a variety of additional functions available.
Advanced driver-assistance systems (ADAS) will be the key
In the short term, ADAS technology and capabilities will play a very important role in getting the market ready for fully autonomous vehicles. The market for ADAS is expected to double in 2021, reaching $35 billion in revenue. As time progresses, ADAS will start to move from premium category to mass offerings as consumers begin to expect significant declines in auto-related accidents and thus becoming more willing to pay for the enhanced feature.
Robo-taxis & autonomous commercial vehicles are gaining popularity
While widespread adoption is not expected until 2030, robo-taxis (self-driving or e-hailing) and autonomous commercial trucks have the potential to bring near-term disruption to the industry due to their efficiency – ability to find routes that are less congested – and most importantly safety as it eliminates human error/fatigue.
A cross-industry impact can be expected
As autonomous vehicles come to market, we anticipate disruption across multiple sectors and industries beyond automotive. In the travel, transport, and logistic industries, autonomous vehicles will disrupt the way companies operate, as they offer a much better alternative and cost-efficient solution.
Autonomous vehicles will also help governments in their “green city” initiatives as they improve mobility (traffic patterns, reduce congestion) while reducing the negative impact on the environment. The insurance industry will, for better or worse, feel the impact due to autonomous vehicles as people get more confident and reassured about the boosted safety of self-driving cars.
At ADK Insights, we continue to monitor trends emerging in mobility and translate their impact on consumer behaviours, providing insights to help businesses future-proof their innovation.
To find out more about our experience in mobility and what it could mean for you, please contact Dam.