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Self-Driving Cars To Bring ‘Revolutionary Change’ To Auto Industry: KPMG, CAR

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DETROIT — For the past hundred years, innovation within the automotive sector has brought major technological advances, leading to safer, cleaner, and more affordable vehicles. But for the most part, since Henry Ford introduced the moving assembly line, the changes have been incremental, evolutionary.

Now the industry appears to be on the cusp of revolutionary change, which will be engendered by the advent of autonomous or “self-driving” vehicles — and the timing may be sooner than you think, according to a new report unveiled Monday by KPMG LLP, the accounting and advisory firm, and the Ann Arbor-based Center for Automotive Research.

The report, titled “Self-Driving Car: The Next Revolution,” is based on interviews with leading technologists, automotive industry leaders, academicians, and regulators — as well as research and analysis of industry trends. The study examines the forces of change, the current and emerging technologies, the path to bring these innovations to market, the likelihood that they will achieve wide adoption from consumers, and their potential impact on the automotive ecosystem.

The findings are outlined in four sections: * Market dynamics: examines the market dynamics and the social, economic, and environmental forces that are making change inevitable. * Convergence: discusses the ongoing convergence of the key enabling technologies. * Adoption: focuses on the path to widespread adoption of advanced automated driving solutions, which we believe will take place in stages, leading over time, to reliance on increasingly autonomous or “self-driving” vehicles. * Implications for investment: addresses the social, political, and economic implications of self-driven automobiles and their impact on the entire automotive ecosystem.

“For the past 100 years, the automotive industry has been a force for innovation and economic growth,” said Gary Silberg, national automotive industry leader for KPMG LLP and co-author of the report.  “Now the pace of innovation is speeding up and the industry is on the brink of a new technological revolution with ‘self-driving’ vehicles. If they become a mainstream reality, it would be profoundly disruptive to the automotive ecosystem and may have far-reaching implications for the traditional automotive value chain and beyond.”

In the report, KPMG and CAR present the hypotheses on how self-driving vehicle technology could unfold and its potential impacts — with an emphasis on the convergence of sensor-based and communication-based vehicle technologies. The report points out that the new technology could provide solutions to some of our most intractable social problems — the high cost of traffic crashes and transportation infrastructure, the millions of hours wasted in traffic jams, and the wasted urban space given over to parking lots, just to name a few.

“For those who embrace innovation and opt to lead rather than follow, a new frontier is opening in the realm of mobility services,” said Richard Wallace, director of transportation systems analysis at CAR and co-author of the report. “Some may ask if it is still just science fiction or if the market will accept them and pay for them. We think the answer is a resounding yes — the marketplace will not merely accept self-driving vehicles, it will be the engine pulling the auto industry forward.”

KPMG’s Silberg added, “Like many of the industry leaders, academics, and policy makers interviewed, we believe the age of the self-driving vehicle is coming. But getting there will require that many pieces of a large puzzle fit together. When and how that will happen remain open questions.”

According to the KPMG/CAR report, the convergence of sensor-based and connected vehicle technologies will happen and will have a positive effect on the adoption of both systems. They think drivers will take the leap. Convergence will bring enhanced mobility and safety and reduced environmental impacts. It may also have far-reaching implications for the traditional automotive value chain and beyond.

Automotive and technology companies are already investing in connected and autonomous technologies and applications. While there is no clear leader, companies are trying to figure out how to compete and collaborate at the same time. Over the longer term, the evolution of these advancements will cause a rebalancing of the automotive value chain, with nontraditional firms playing a more significant role.

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