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Study: Electrification/ Autonomous Driving Could Take Decades

February 28, 2018 0 Comments

While most automakers are moving towards electrification and autonomous vehicles, the Center for Automotive Research predicts that investments into the new tech could slow down in the coming years, with such futuristic vehicles only making up a fraction of sales by 2030.

On February 21, the Michigan-based research group presented their findings to the Automotive Press Association, saying that Level 4 and Level 5 self-driving vehicles will account for less than 4 percent of new-vehicle sales by 2030. However, they predict that the number will steadily increase to around 55 percent by 2040. CAR also believes that alternative powertrains (e.g. battery-electric and fuel cell vehicles) will comprise 8 percent of the market by 2030.

Government emissions and fuel economy mandates are helping drive the development of the future tech, with CAR saying that autonomous vehicles and electrification will “first impact fleets of shared vehicle services in dense urban areas.” Any economic downturn, however, could hinder the tech’s broader implementation.

“While the technology to electrify and automate vehicles will take decades to proliferate, automakers and suppliers must invest now to have a stake in the future of the transformed automotive industry,” said CAR CEO Carla Bailo during the presentation.

“Profits have been steady and investments have continued throughout the economic expansion. The challenge will come when sales begin to soften further and profitability lags. Will the auto industry continue to spend at the current pace through a downturn in the business cycle? If recent history is any guide, they will not — at least not at the current speed and scale of investment.”

Customer perception and preference may be the biggest challenges the automotive industry faces when it comes to self-driving cars.

During the presentation, CAR cited various studies suggesting that fewer Americans consider ride-hailing and car-sharing services over traditional public transport as alternatives to personal ownership.

Additionally, younger people are more open to the autonomous tech. In a 2016 study, 40 percent of respondents between 25 and 34 years old said they were comfortable will full autonomy. The percentages dropped in the 45-54 years (23.4 percent) and 55-64 (18.9 percent) years age groups.

Customer preferences also vary from country to country. In the U.S., a recent survey found that 18 percent said they preferred electrified powertrains over conventional gas engines, while the same survey in China found that 56 percent prefered the electrified powertrains.

“BEV and fuel cell vehicles may gain broader market acceptance at some point in the future, but for the coming decade, the ICE powertrain will likely remain dominant in the U.S. market,” Bailo said.

Despite the predicted slowing of progression, CAR argued that society will eventually embrace the benefits of EVs and autonomous vehicles as they get deployed in cities. The tech will then spread to the suburbs, and eventually to rural areas. Personally owned electric and autonomous vehicles will take longer to deploy, associated with more costs.

“The automotive world is inching ever closer to an electrification tipping point, and the development and deployment of automation technologies are rapidly advancing,” Bailo said. “Automakers and suppliers will develop these technologies for — and in — those markets and countries where consumers demand them, and where infrastructure, incentives and regulatory mandates are aligned.”

About the Author:

Dave Martinson is a broadcast journalist for DrivingSalesNews. He has a background as a TV News Reporter, Anchor and Producer. He has also worked in Digital Marketing and Human Resources. He received his bachelor’s degree in Communication from Brigham Young University – Idaho. He’s married and originally from the state of Washington. He’s a huge football fan and enjoys the outdoors.