The autonomous car market is estimated at $42 billion by 2025, according to the Boston Consulting Group’s report titled ‘Revolution in the Driver’s Seat’.

With nine billion people projected to live in urban areas over the next 25 years, automakers are under pressure to create technologies that will ease gridlocks and give motorists stuck in traffic the ability to multitask safely.

In this backdrop, Prime Minister Narendra Modi’s Digital India Campaign is welcome news for the driverless car ecosystem of the future. With plans to roll out free Wi-Fi connections in 2,500 cities and towns, it will help driverless cars operate safely and take precise decisions. They need to have vast amounts of data stored which can pass back and forth with efficient connected car management. Such autonomous capabilities need networks that can transmit data seamlessly/securely in real time.

Game changer

Auto insurance global revenues increased by a whopping $33 billion in 2013, states a McKinsey report of 2014 styled ‘Global Insurance Industry Insights’. However, all this may change with driverless cars of the type that do not actually require drivers. As a result, the car-related insurance business may be at risk. In a driverless car, accidents are less likely since human error is taken out of the equation. With fewer accidents, car-insurance payments will also fall.

Uber recently announced a partnership with Carnegie Mellon University to create Uber Advanced Technologies. The focus will be on R&D, primarily in the areas of mapping vehicle safety and autonomous technology. The company believes that when there are no drivers in the car, opting for an Uber is cheaper as against owning a vehicle.

Self-drive service providers in India need the user to pick up and drop a car at a designated location. With driverless cars, a customer can use his smartphone app to summon a vehicle. It arrives at his doorstep, takes him to the destination after which it picks up another customer or parks somewhere till the next booking comes in.

Realising the potential of autonomous vehicles in revolutionising road transport, Singapore has set up a committee on autonomous road transport which will support research and implementation of self-driving cars. Besides government officials, the board includes representatives from the Massachusetts Institute of Technology, Nissan, Toyota and Continental.

A global need

A recent study by MIT's Aeronautics and Astronautics department, led by Professor Emilio Frazzoli, has estimated that a fleet of 300,000 autonomous shared vehicles can serve the entire population of Singapore. This translates into nearly six million people with a maximum waiting time of 15 minutes at peak hours.

Chinese web services company, Baidu, is working on a self-driving car in partnership with BMW and this could be a clear signal that the Chinese government has enough power and flexibility to allow production of driverless cars.

The government of UK also wants to become a world leader in driverless technology. It has launched a £10 million fund for driverless car researchers funded by the Department for Business, Innovation and Skills and the Department for Transport.

In addition, the Department for Transport has announced $29 million in funding for three driverless car trials: a shuttle in Greenwich, a “pod” in Milton Keynes and Coventry, and a Wildcat developed by BAE Systems in Bristol. Germany is not too far behind either with its government laying down guidelines for driverless cars.

Japanese automakers, similarly, are teaming up to develop parts, technologies and infrastructure for self-driving cars. The project will bring the country’s transport officials together with Toyota, Honda and Nissan, as well as Denso, Panasonic and Hitachi. Added help will come from the University of Tokyo and Nagoya University in establishing smart road infrastructure standards

VV Ravi Kumar is Associate Professor in Marketing and Parth M Doshi an MBA (Innovation) student at SIBM, Pune

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