There is a lot of talk nowadays about smart self-driving cars, but when are we going to see widespread consumer adoption? A recent McKinsey report sets out predictions for the next 35 years.
In 2015 we are not yet at the point where everyone is using an autonomous vehicle (AV). Nevertheless, there is now a lot of enthusiasm about self-driving cars and several months ago Elon Musk declared that by 2020 a Tesla car will be capable of running on auto-pilot 90% of the time.
Meanwhile industrial firms have been taking AVs on board. McKinsey forecasts that within five years autonomous vehicles will be in use for specific purposes, including repetitive tasks, in agriculture, mining, logistics and construction. Productivity is expected to boom as the cost of manpower falls and CO2 emissions are reduced. McKinsey also predicts that from 2040 road haulage firms will also be using these new types of vehicles.
OEMs and Insurers in transition
The advent of vehicles capable of taking the decision-making out of drivers’ hands will mean that insurance companies will be forced to change tack. McKinsey foresees a radical change in their business model from 2025 when their prime customers will no longer be the millions of private car owners but companies involved in the manufacture of autonomous vehicles – both original equipment manufacturers (OEMs) and infrastructure management firms. The insurance model will shift from covering people against making a mistake to covering the technical risks associated with developing and manufacturing connected cars.
Timeline for mass market adoption of smart autonomous cars Source: McKinsey
After-sales service is also likely to undergo changes as more people start to use autonomous vehicles and the market landscape evolves. OEMs might well take over vehicle maintenance and repair. In 2014, around 80% of all garage businesses in Germany were service providers working independently of the OEMs. The McKinsey report points out that ‟given the safety-critical nature of AV technologies, customers might strongly prefer strict adherence to OEM service processes and the use of original service equipment when it comes to maintaining and repairing AV systems.”
AV owners will have different daily habits
The report predicts that by 2050 owning a smart autonomous vehicle will become the norm for consumers. Car drivers will have time to attend calmly to business or personal matters during the journey, as AVs will free up as much as 50 minutes a day for their productive use. The time saved “could also create a large pool of value, potentially generating global digital-media revenues of €5 billion per year for every additional minute people spend on the mobile Internet while in a car,” state the report’s authors.
The autonomous vehicle could free up as much as 50 minutes a day for drivers
Moreover, parking will become child’s play. The McKinsey report says that the total space required for parking in the United States could potentially be reduced by more than 5.7 billion square meters.
All in all, the smart connected car will be able to take over in areas of potential human shortcomings. Consequently, road accidents in the United States are expected to fall from the second most frequent cause of death to ninth place.