Presentation on theme: "The deployment of AVs is less about technological capabilities and more about the ability of stakeholders to manage various commercial and governance complexities."— Presentation transcript:
1Deploying autonomous vehicles Commercial considerations and urban mobility scenarios
2The deployment of AVs is less about technological capabilities and more about the ability of stakeholders to manage various commercial and governance complexities associated with having such vehicles on the roadEY’s Global Automotive Center has developed the following points of view:AVs offer several benefits…however, the road to autonomous driving has a number of challenges that will need to be resolved to achieve a sustainable mobility ecosystem in the future.Given the implementation complexities, AVs are expected to be launched through multiple controlled scenarios in and around urban areas.As the benefits outweigh the costs, and liability, safety and security concerns are addressed, these controlled scenarios will expand and merge across vast urban areas and eventually integrate intercity mobility as well.AVs represent a significant paradigm shift to the mobility ecosystem — not only a technological revolution, but a value chain transformation. The commercial deployment of AVs will have far-reaching implications for stakeholders across all levels of the mobility value chain.
3AVs are coming but through controlled deployment in an integrated urban mobility ecosystem.. Are stakeholders prepared for the technological, commercial and governance complexities?road accidents caused due to human error95%leading cause of death globally: Road accidents8thincrease in delay hours due to congestion by 20502xUrban dwellers accounting for 70% of population by 20506.3 BillionTrendicatorsControlled, AV-only environmentsModerate level of automationLow to medium speedsLarge, connected vehicle networks; no constraintsOn demand mobility & fleet servicesCustomized consumer AVsLess restricted environmentsHigh level of automationMedium to high speedsyearsyearsBeyond 20 yearsSource: UN World Urbanization Prospects, World Business Council for Sustainable Development, Factiva, Navigant Research, Cnet.com, EY analysis
41 2 3 Agenda Case for AVs, levels of autonomy, likely AV deployment scenarios,Benefits andchallenges of AVdeployment, role of governmentKey considerations for industry participants to become competitive in the AV space
5Vehicles with varying levels of autonomous driving capability will coexist over the next few decades, and therefore different deployment scenarios will be necessaryL0L1L2L3L4LowHighLevels of autonomyDriver controlVehicle controlConnectivity*Source: EY analysis* Connectivity includes vehicle-to-device, vehicle-to-vehicle, vehicle-to-infrastructure, and vehicle-to-home
6Control shifts from Driver to the Vehicle across scenarios AVs to be deployed in controlled environment initially… as benefits outweigh costs, and concerns addressed, AV landscape will evolve and expand to connected highways, urban centers, public AV transportationControl shifts from Driver to the Vehicle across scenarios1Self-parking structures/lots2Dedicated AV highway lanes3Connected urban centers4Public AV transportation5Expanded AV highways1. Self parking structure –Low to medium speeds; controlled driving parametersAutomation: vehicle system control only within range of self-parking infrastructure networkAV-only parking sections/floors to accommodate early stages of self-park technology roll out2. Dedicated AV highway lanes –Driver cedes control of primary vehicle functions when entering connected highway; regains control upon lane exitCommuter “trains” or “platoons” of AVs in AV-only, connected highway lanes3. Connected urban centers –Driver enters AV network within city center, cedes control of primary vehicle functionsAutomation: vehicle system control within networked, urban centers4. Public AV transportation –AV taxi, busing services, shuttle servicesRide-share, car-share servicesFirst mile/last mile commuter services5. Expanded AV highways –AVs function at higher speedsCommuter AV “trains”/“platoons” navigate AV lanes with independently operated AVsDriving restrictions shift to human-operated vehicles – limited/no access6. Fully AV ecosystem –AV networks expand to suburban areasUrban centers and suburban networks “attached” by connected highways6Fully AV ecosystem
7AV deployment case studies Case studies: consumer AV deployment will look similar to the real-world AV testing already initiated around the globeBenefits/advantagesChallenges/constraintsAV deployment case studiesLow =Medium =High =1Self-parking structures/lotsAudi to install self-parking system in Ingolstadt, Germany (with wireless payment system)Self-parking of vehicle in the nearest garage spaceCan be activated through a smartphone app2Dedicated AV highway lanesSafe road trains for the environment (SARTRE) project has been tested in Europe to enhance road transportationSmoother flow of trafficReduce/eliminate the accidents caused due to human error3Connected urban centersThe University of Michigan Transportation Research Institute 30+ acre test track for AVs to be tested in real world conditions. The test sight includes an urban center simulation, merging lanes, roundabouts, gravel roads, traffic lights and a stretch of four-lane highway.4Public AV transportationA fleet of autonomous electric pods will operate in Milton Keynes, UK between city’s central station, shopping center and office parksPods will carry two passengers plus baggageBooking through smartphones1. Self parking structure –Low to medium speeds; controlled driving parametersAutomation: vehicle system control only within range of self-parking infrastructure networkAV-only parking sections/floors to accommodate early stages of self-park technology roll out2. Dedicated AV highway lanes –Driver cedes control of primary vehicle functions when entering connected highway; regains control upon lane exitCommuter “trains” or “platoons” of AVs in AV-only, connected highway lanes3. Connected urban centers –Driver enters AV network within city center, cedes control of primary vehicle functionsAutomation: vehicle system control within networked, urban centers4. Public AV transportation –AV taxi, busing services, shuttle servicesRide-share, car-share servicesFirst mile/last mile commuter services5. Expanded AV highways –AVs function at higher speedsCommuter AV “trains”/“platoons” navigate AV lanes with independently operated AVsDriving restrictions shift to human-operated vehicles – limited/no access6. Fully AV ecosystem –AV networks expand to suburban areasUrban centers and suburban networks “attached” by connected highways5Expanded AV highwaysNew Energy and Industrial Technology Development Organization (NEDO) of Japan successfully tested self-driving truck caravansWill increase shipping efficiency throughout Japan when implemented6Fully AV ecosystemGoogle’s self-driving car passes 700,000 accident-free miles; can now avoid cyclists, stop at railroad crossingsHas successfully navigated real-world suburban environments, interacting with regular vehicles, pedestrians, existing signage and traffic light systems.
8The transformation to automated driving offers many benefits… Traffic safetyFuel consumptionTraffic flowVehicles per familyTransportfor allVehicle sharingAccidentCostSafetyMobilityEfficiencyBenefitsEliminate human driving error, responsible for 95% of road accidentsDecrease traffic accidents:saving livespreventing injuryavoiding the US$ billions in accident- associated costsTransportation efficiencies:reduced traffic congestionincreased roadway capacityshorter commute timesDecrease in fuel consumptionDecline in vehicle ownership; vehicles/ family reducedExpansion of car- and ride-share, commuter programs; first mile/last mile servicesIncreased mobility for elderly, disabled, children too young to drive
9Technology Governance Capital Challenges … however, the road to autonomous driving is not without its challengesPrivacyCostInfrastructureInsuranceRegulationLiabilityData qualitySecurityTechnologyGovernanceCapitalChallengesMaintain privacy while collecting data to run robust networkData accuracy, processing speeds critical to a safe transport environmentIncreasing vehicle IT content increases the threat of malicious software, hardware manipulationHigh cost of automated driving technologiesUpdating infrastructure with communication, monitoring technologies costly for governments & municipalitiesResponsibility for malfunctions, accidents?Liability shifts from vehicle owner to AV providersWho pays the premiums?Governments reluctant to allow AVs on public roadsEnsure safety of AVs before allowing mass adoption
10What the driver/buyer wants? A collaborative eco-system is needed to address a range of driver’s mobility requirements beyond AVsExperienceSafetyPrivacy / SecurityEfficiencyEconomicalWhat the driver/buyer wants?OEMsLocalGovernmentsIT/TelecomcompaniesTier-1-2suppliers3rd party providersInsurance companies% of Global vehicle sales attributed to AVs2025203020354%41%75%85%CAGR of AV sales for three largest markets (North America, Western Europe and Asia Pacific) betweendata/sec gathered by fully functioning AV750 MB/secTrendicators
11Incentives and investment considerations Regulatory considerations Government will need to play a key role in facilitating the introduction and adopting of AVs, through suitable regulations, incentives and requisite infrastructure developmentFunding/Direct investmentIncentives such as tax breaksEvidence of benefits via studies to improve user acceptanceInfrastructure development such as designated lanesDefining accountability and liabilityDetermining appropriate standards for security and data privacyCreating a roadmap to help bring together the various autonomous vehicle scenariosDriver training/ licensing requirementsEncourage common legislation standards across geographiesIncentives and investment considerationsRegulatory considerations
12Commercial deployment of AVs presents significant changes to the automotive sector with far reaching implications and considerations for stakeholders across the value chainVehicle OEMsIntegrated mobility providersSuppliersDealer/ retail networkTechnology/telecom companiesGovernment/regulatory bodiesNeed to balance the benefits and challenges throughAV ecosystem stakeholdersOperating and performance considerationsInvestment and capital considerationsStrategic considerations
13Strategic considerations for AV stakeholders Key stakeholdersStrategic considerationsVMsUse new business models that optimize new sales and service opportunities, such as AV sharing, innovative finance programs, targeting fleet customersCollaborate within and outside the auto industry on R&D to maintain leadership position in AV innovation and be the first to market with new AV technologiesSuppliersFocus R&D investments on AV solutions that generate the most value for your customers — breakthrough technology pioneersPartner with technology and telecom companies to accelerate innovation and reduce costsTechnology/ Telecom companiesConsider expanding scope of business to include all aspects of AVs’ technology and data requirements — holistic solutions for connectivity, security and privacy, data processing, management and analyticsInvestigate opportunities to establish partnerships with existing VMs to develop new, AV-only offeringsIdentify and partner with cities and integrated mobility providers to address impact of autonomous vehicles on their respective business models, infrastructure and networksGovernment/regulatory bodiesDevelop future state urban network plans that address the gradual increase in vehicle automation, network connectivity and data requirements of AVsEngage early (and often) with key stakeholders in AV policy and legislation design and implementation, certification, license requirements and trainingConduct independent research and analysis of automated driving and the implication for urban infrastructure and mobility planning over the next 50 yearsDealer/retail networkEstablish integrated service offerings (maintenance, software upgrades and customization, insurance, charging stations) to maintain brand recognition and consumer connectionConsider developing new service opportunities such as AV driver training and certificationRestructure aftermarket business model to address new retail competition that may spawn from AV deploymentIntegrated mobility providers*Evaluate investment opportunities within urban networks most likely to adopt AV usage and establish a presence in these areasCollaborate with VMs on new AV fleet and commuter services that are likely to grow in the new AV ecosystem* includes car sharing companies
14Operating and performance considerations for AV stakeholders Key stakeholdersOperating and performance considerationsVMsDevise methods of data analytics to manage and interpret significant volume of AV dataAssess readiness for regulatory changes in local marketsManage warranty costs owing to rising technological complexitiesInstitutionalize checks to ensure data privacy and securityTechnology/ Telecom companiesExplore a more active role in the automotive value chain by providing the requisite infrastructure, data mining, privacy and bandwidth solutionsGovernment/regulatory bodiesInstitutionalize a framework to enable and run smart and integrated megacitiesProvide regulations and policies around deployment of AVs — data privacy and cybersecurity, safety and liability, incentives and taxationSeamlessly integrate public transportation into smart citiesIntegrate vehicle registration, state taxes and tolling chargesRe-license drivers to be certified for using AVsCollaborate and develop industry-wide certification process for levels of autonomy and safetyDealer/retail networkInvest in employee (on-floor, sales and technicians) and driver training, and customer awarenessUse digital media and smartphones to promote features and facilitate customer transactionsService the AV network and infrastructure
15Investment and capital considerations for AV stakeholders Key stakeholdersInvestment and capital considerationsVMsForm need-based and strategic alliances, JVs and acquisitions to gain technology and reduce costsCreate a network of partners to enable new revenue streams — car-sharing programs, on-demand mobility, AV fleet service, in-vehicle entertainment/advertising, etc.Technology/ Telecom companiesExplore opportunities to emerge as a mobility solutions providerPotentially partner with existing VMs in expanding deployment of AV scenariosPartner with local government, VM’s, other technology companies for investment in requisite infrastructure; targeting cities as customersGovernment/regulatory bodiesInvest in requisite infrastructure to enable deployment of AVsSupport AV research through R&D incentives, testing infrastructure, and encouraging local stakeholder participation in processDealer/retail networkAdapt business model to the evolving landscape and compete with non-automotive retail competitionExplore other revenue streams, such as car-sharing programs and on-demand mobility
16Want more? Contact one of our global automotive professionals: Michael Hanley Global Automotive LeaderTel:Dr. Rainer Scholz Mobility Innovation Group LeaderTel:Randall Miller Global Automotive Advisory LeaderTel:Anil Valsan Lead Automotive AnalystTel:Jean-François Tremblay Advanced Mobility LeaderTel:Regan Grant Global Automotive Marketing LeaderTel:AcknowledgmentsSpecial thanks to EY Knowledge automotive analysts Joe Sebestyen, Swati Khurana and Gaurav Batra for the analysis and compilation of this study.