Autonomous Driving: The Opportunities and Obstacles for Multiple Industries
The adoption of self-driving vehicle (SDV) technology will have significant impacts – favourable and unfavourable – across multiple industries, not just transportation.
Among the benefits, SDV technology will aid in the expansion of sustainable energy and the decrease of carbon emissions. It will also increase safety, improve mobility, and reduce costs. All this in addition to revolutionizing the way we travel and experience transportation.
However, by disrupting traditional business models, the adoption of SDV technology will also create varying challenges. For some industries the challenges will be greater than others.
Right now, Actalent is supporting multiple automotive companies that are working on electric and autonomous driving capabilities. Actalent supports the hardware and software design activities and functional safety analysis such as FTA, FMEA, Reliability analysis, and stress analysis. Actalent has a team of functional safety-certified engineers who supports autonomous driving projects.
Overall, companies aiming to reach fully autonomous driving (level 5) can expect to encounter a wide range of both opportunities and obstacles.
What follows below is a breakdown, by industry, of the opportunities and obstacles associated with SDV technology and the electric vehicle market.
- Automotive manufacturers: The electric vehicile (EV) market is rapidly growing, and automakers that can successfully transition to electric vehicles will be well-positioned to capture market share and generate significant revenue. SDVs will require a significant amount of technology and hardware, creating new opportunities for automakers to develop and produce vehicles with advanced safety features, autonomous capabilities, and other innovative technologies.
- Battery and Charger manufacturers: The production of EV batteries requires significant investment and research, creating opportunities for battery manufacturers to develop new technology and supply the growing demand for high-capacity batteries. Lithium technology and fast charging technology still need to advance more to meet the traditional gasoline or diesel car reliability. There will be a need for more charging infrastructure, creating opportunities for companies that provide charging stations and related services.
- Public transportation providers: The adoption of EVs could help public transportation providers reduce their carbon footprint, decrease operating costs, and improve the rider experience.
- Ridesharing and taxi services: SDVs have the potential to facilitate ride-sharing and taxi services, leading to reduced labor costs, enhanced safety, and the provision of new, convenient transportation choices for customers.
- Electric utilities and renewable energy companies: The widespread adoption of EVs will increase demand for electricity, creating new opportunities for electric utilities and renewable energy companies to supply clean electricity for transportation. The adoption of EVs is linked to the growth of clean energy, as EVs run on electricity that can be generated from renewable sources like solar and wind power. This will require significant upgrades to the electrical grid infrastructure to support the increased demand for electricity, creating opportunities for companies involved in grid modernization and management
- Software and technology companies: With the increasing intelligence and connectivity of EVs, there will be ample opportunities for Artificial Intelligence (AI) and Machine Learning (ML) software technology firms to innovate new solutions for managing autonomous driving, optimizing EV charging, and integrating EVs into smart cities and grids.
- Electronics and Infrastructure providers: The widespread implementation of SDVs will necessitate substantial investment in infrastructure, including the development of new sensors, cameras, and other technologies to facilitate autonomous driving. This presents opportunities for businesses that specialize in offering such products and services.
- Logistics and delivery companies: The integration of SDVs in logistics and delivery operations has the potential to assist companies in lowering labor expenses, enhancing efficiency, and advancing safety.
- Insurance companies: As the use of SDVs becomes more prevalent, insurance companies will have the opportunity to create and market new insurance products that address the unique risks associated with autonomous driving.
- Entertainment and media companies: The advent of SDVs may offer fresh prospects for companies that offer in-vehicle entertainment and advertising, as it could lead to the emergence of novel forms of such services. As the degree of autonomous driving increases, it is likely that there will be a rise in the demand for movies and entertainment media consumption within vehicles.
Actalent has seen a rise in the electric and autonomous driving project demands and has seen a similar decline in the projects in gasoline and internal combustion engine (ICE)-based projects. As the number of mechanical parts and wiring is less in the EVs, there is also a reduction in the electro/mechanical design analysis needed compared to ICE-based projects.
- Oil and gas companies: EVs do not use gasoline or diesel fuel, reducing the demand for fossil fuels and potentially impacting the revenue of oil and gas companies.
- Gas station operators: As the adoption of EVs grows, the demand for gasoline could decrease, potentially impacting the profitability/job of gas station operators.
- Automotive aftermarket companies: EVs offer several advantages over traditional ICE vehicles. As EVs have no clutch or gears, they can provide smooth and rapid acceleration, giving drivers a similar experience to driving a sports car. Moreover, EVs have fewer moving parts, resulting in reduced maintenance costs. An electric engine has around 20 moving parts, while an ICEV has nearly 2,000, making electric engines simpler and more reliable. This could reduce the demand for automotive aftermarket parts and services.
- Traditional car dealerships: EVs may require a different sales approach than traditional vehicles, and some dealerships may struggle to adapt to the new technology and sales models. There are EVs that are sold online and direct to customers without a dealership in between.
- Auto repair shops & Auto mechanics: As SDVs have a simpler design and may require less maintenance compared to traditional vehicles, the shift towards SDVs could lead to a decline in demand for certain auto repair services. EVs’ maintenance needs differ from those of traditional vehicles, and auto mechanics may need to develop new skills to service EVs.
- Public transportation providers: The adoption of SDVs could disrupt the traditional public transportation industry, potentially leading to a decline in ridership and revenue for public transportation providers.
- Driving schools and Transport officers: As the need for drivers will be declining, the need of driving schools and transport officers may come down
- Logistics and delivery companies: The adoption of SDVs could lead to the displacement of human drivers, which could impact employment in the transportation and logistics industry.
- Auto insurance companies: The evolving risk profile of accidents and liability, shifting from individual drivers to the manufacturers and operators of SDVs, could require auto insurance companies to adjust their business models accordingly.
Real Estate (parking revenue)
- As SDVs are designed to operate continuously and can be shared between multiple users, the demand for parking spaces may decline, leading to a reduction in revenue for parking operators.
In summary, although SDV adoption will likely offer significant advantages, it could pose difficulties and disturbances for industries that depend on human drivers or conventional transportation methods. Industries that rely on fossil fuels or traditional combustion engine vehicles may also suffer negative consequences. Nevertheless, it is crucial to acknowledge that many of these industries have the potential to shift towards SDVs and take part in the increasing market for self-driving transportation.