Business models will drive the future of autonomous vehicles

By Aarthi Rayapura August 31, 2017

Excerpts from an article by S. Somasegar in TechCrunch

Over the last year, we have seen many groundbreaking announcements regarding autonomous cars, from companies like Ford promoting its autonomous vehicle leader to the position of CEO, to Tesla’s NHSTA investigation showing a 40 percent decrease in accidents with Autopilot enabled and Audi beginning mass-market sales of a “Level 3” autonomous car.

Nevertheless, many questions in the world of autonomous vehicles remain unanswered. How will autonomous cars make ethical decisions, as in the case of the “trolley problem”? How will cities, streets and parking change? What will happen to the millions of people employed as ridesharing drivers or long-haul truck drivers? What is the right package of sensors to drive autonomous vehicles?

We believe that many of the open questions about autonomous vehicles will be answered not just by technological innovation but by the emerging business models around autonomous vehicles. For example, if regulators decide to tax autonomous vehicles based on miles traveled within a city, there will be different incentives for vehicles to stay close by to maximize trips and minimize costs. If car companies decide to sell cars directly to fleet operators instead of consumers, they will allocate marketing and research and development dollars differently.

There is no better indicator for how companies will make decisions across many technology, business and societal questions than their underlying business models and profit motives.

Here are what we see as several of the key questions and implications for autonomous vehicles today.

  • What will the autonomous vehicle operating system look like?
  • How will users pay for transportation? As a service or own cars?
  • Who generates the data? Who processes the data? And who owns the data?
  • What portion of the value chain will capture the most value?
  • What is the impact and role of regulators in the development of autonomous vehicles?

Read the full article in TechCrunch

And watch this keynote from Subscribed 2017 where Jamie Allison, Ford’s Director of Mobility and Consumer Experience explains the company’s transformation from a “car company” to a “mobility company”.