Autonomous driving and future market scenarios : A strategy case study for a leading automotive supplier

Abstract

Autonomous driving (AD) is a technological innovation that is bound to disrupt the automotive industry. In this study, a detailed analysis was undertaken to provide a comprehensive and realistic understanding of the new AD market. What are the technological and business challenges ahead of the mass adoption of this technology? What are the business models that are likely to emerge? Which have the most likelihood of success? Despite the anticipated benefits for individuals and economies, the market penetration of AD technology faces significant technological, regulatory and business challenges. From an automotive OEM stand point, the advent of AD technology is not pleasant news. New entrants threaten to make the automotive industry even more competitive than it already is. AD based business models threaten to affect auto sales negatively and compete with OEMs at their core business. On the other hand, the AD market represents a huge growth opportunity for suppliers of key technologies like RADAR and LiDAR. Staying ahead of competition and new entrants in terms of cost and technology is a necessary requirement to capitalize on this opportunity. The first anticipated application for AD technology is the RoboTaxi. This, however, represents only a tiny fraction of less than 1% of the total mobility market. For AD technology to expand its penetration beyond the taxi market into the vast mobility market of POCs, AD-technology has to establish a service that is attractive enough for POC owners. This is the ambition of the MaaS-AD services. To compete with POC, AD based mobility service has to establish a big enough technology and business geo-fence. There are serious challenges ahead of that. In a mid-case scenario this study anticipates a 10 % market penetration for AD vehicles in 2030.

Autonomous driving (AD) is a technological innovation that is bound to disrupt the automotive industry. In this study, a detailed analysis was undertaken to provide a comprehensive and realistic understanding of the new AD market. What are the technological and business challenges ahead of the mass adoption of this technology? What are the business models that are likely to emerge? Which have the most likelihood of success? Despite the anticipated benefits for individuals and economies, the market penetration of AD technology faces significant technological, regulatory and business challenges. From an automotive OEM stand point, the advent of AD technology is not pleasant news. New entrants threaten to make the automotive industry even more competitive than it already is. AD based business models threaten to affect auto sales negatively and compete with OEMs at their core business. On the other hand, the AD market represents a huge growth opportunity for suppliers of key technologies like RADAR and LiDAR. Staying ahead of competition and new entrants in terms of cost and technology is a necessary requirement to capitalize on this opportunity. The first anticipated application for AD technology is the RoboTaxi. This, however, represents only a tiny fraction of less than 1% of the total mobility market. For AD technology to expand its penetration beyond the taxi market into the vast mobility market of POCs, AD-technology has to establish a service that is attractive enough for POC owners. This is the ambition of the MaaS-AD services. To compete with POC, AD based mobility service has to establish a big enough technology and business geo-fence. There are serious challenges ahead of that. In a mid-case scenario this study anticipates a 10 % market penetration for AD vehicles in 2030.