Self Driving kkk

8/9/2019 Self Driving kkk

1/77

----------------------- Page 1-----------------------

Self-driving cars:The next revolution

kpmg.com | cargroup.org

----------------------- Page 2-----------------------

----------------------- Page 3-----------------------

A message from Gary Silberg andRichard Wallace

For 125 years the automotive industry has been a force for innovation and economic

st

growth. Now, in the early decades of the 21 century, the pace of innovation is speeding up and the industry is on the brink of a new technological revolution: self-driving vehicles.

The new technology could provide solutions to some of our most intractable socialproblemsthe high cost of traffic crashes and transportation infrastructure, themillions of hours wasted in traffic jams, and the wasted urban space given overtoparking lots, just to name a few. But if self-driving vehicles become a reality, theimplications would also be profoundly disruptive for almost every stakeholder in theautomotive ecosystem. As one industry executive put it, Everything, from how wemove goods to how we move ourselves around, is ripe for change.

KPMG LLP and the Center for Automotive Research (CAR) collaborated on this report,interviewing leading technologists, automotive industry leaders, academicians, andregulators to develop hypotheses on how self-driving vehicle technology could unfoldand its potential impacts. It is clear from our research that any company remain

ingcomplacent in the face of such potentially disruptive change may find itself leftbehind, irrelevant.

For those who embrace innovation and opt to lead rather than follow, a new frontier isopening in the realm of mobility services.

We hope you will find our report illuminating and that we will have opportunities todiscuss our findings with you in the near future.

Gary Silberg Richard WallacePartner, KPMG LLP Director, Transportation Systems Analysis


2/77

National Sector Leader Automotive Center for Automotive Research

----------------------- Page 4-----------------------

Self-Driving Cars: An Introduction

On the cusp of revolutionary change

For the past hundred years, innovation within the automotive sector has broughtmajortechnological advances, leading to safer, cleaner, and more affordable vehicles. But forthe most part, since Henry Ford introduced the moving assembly line, the changes

sthave been incremental, evolutionary. Now, in the early decades of the 21 centur

y, theindustry appears to be on the cusp of revolutionary changewith potential to dramaticallyreshape not just the competitive landscape but also the way we interact with vehicles and,indeed, the future design of our roads and cities. The revolution, when it comes, will beengendered by the advent of autonomous or self-driving vehicles. And the timing maybe sooner than you think.

KPMG LLP and the Center for Automotive Research (CAR) joined forces in developingthis white paper to examine the forces of change, the current and emerging technologies,the path to bring these innovations to market, the likelihood that they will achieve wideadoption from consumers, and their potential impact on the automotive ecosystem.

Our research included interviews with more than 25 thought leaders, automotive and high-tech executives, and government officials as well as analysis of industry trends. This whitepaper presents our findings, with an emphasis on the convergence of sensor-based andcommunication-based vehicle technologies and its implications.

The revolution, when it comes, will beengendered by the advent of autonomous orself-driving vehicles. And the timing maybe sooner than you think.

4 Self-driving cars: The next revolution

----------------------- Page 5-----------------------

The findings are outlined in four sections:

Market dynamics examines the market dynamics and the social, economic, and


3/77

1 environmental forces that are making change inevitable.

2 Convergence discusses the ongoing convergence of the key enabling technologies.

Adoption focuses on the path to widespread adoption of advanced automated driving

3 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

4 of self-driven automobiles and their impact on the entireautomotive ecosystem.

Self-driving cars: The next revolution 5

----------------------- Page 6-----------------------Self-Driving Cars: Section 1

Market dynamics

Imagine. It's 6:25 p.m. and you've just wrapped up a meeting. You still have several itemson your must-do list before you can call it a night and a 25-minute commute that usedto take as long as 90 minutes in the bad old days of rush-hour traffic.

But no worries today. You flick open an app on your phone and request a pick-upat theoffice; a text confirmation comes back and a few minutes later a car pulls up. Home,you say, as you launch a call to your client in Shanghai. The car slips easily into the self-drive lane, checking road conditions and flashing a message that you will arrive homein 24 minutes. In that time, you will have reviewed a report with your client, answerede-mails, and set your pick-up time for tomorrow morning. You arrive home ready to relaxand focus on your family. You step out of the car and it moves off to its next pick-up.

A Self-Driving Car?

Even now that military drones have become a familiar topic, the idea of self-driving cars sounds prettyfar fetched. But is it still just science fiction? Something that gets batted around in robotics labs and thinktanks? Or are self-driving vehicles on the verge of becoming a viable form of personal mobility? Will themarket accept them, want them, and pay for them?

We think the answer is a resounding yes: The marketplace will not merely acceptself-driving vehicles; it willbe the engine pulling the industry forward. Consumers are eager for new mobility alternatives that would


4/77

allow them to stay connected and recapture the time and psychic energy they squander in traffic jams anddefensive driving. Or as Stanford University's Sven Beiker put it, The paradigm shift in the consumer's mind

1relative to personal mobility is a key factor for self-driving vehicles.


----------------------- Page 7-----------------------

The Status Quo: The High Cost of MobilityDriving Demographics

The desire to go where we want whenever we want has been aWill people willingly cede control to a machine and give up

powerful market force for centuries. And the automotive industrydriving their own car? For baby boomers, especially, turning

has beenand continues to bea critical component of the U.S.16 and getting a driver's license was a rite of passage. Buteconomy, employing 1.7 million people (across manufacturers,

demographics are changing, as are attitudes towards driving.suppliers, and dealers) and providing $500 billion in annual

Younger generations, the ones who grew up with gamecompensation, as well as accounting for approximately 3 percent

consoles and smart phones, are not so in love with cars. They

2of GDP. But mobility is increasingly expensive and inefficient.

live perpetually connected lives, and while they may haveFirst, of course, is the total cost of vehicle ownership, which can

the same desire for mobility on demand, some see the act of

8bring the price of a $21,000 car driven an average of 15,000 miles

driving as a distraction from texting, not the other way around.per year to more than $40,000 over five yearsfor a machine that

Their antipathy towards driving may be a good thing, givensits unused on average, almost 22 hours out of every day.3

these statistics: Distractions account for 18 percent of crashes

with injuries, and 11 percent of drivers under age 20 involved inWe also pay heavily to build and maintain our roads. The U.S.

9

crashes with fatalities were reported to have been distracted.Department of Transportation (USDOT) estimates that newconstruction of four-lane highways in an urban area costs

This groupmembers of the Gen Now generation (seebetween $8 million and $12 million per mile. Even resurfacing that

Figure 2 below)are not rushing to get driver's licenses theroad, at an estimated $1.25 million per mile, can be daunting for

way baby boomers did. In 1978, nearly half of all 16-year-oldscash-strapped governments.

and 75 percent of all 17-year-olds had licenses; by


5/77

2008, those numbers had dropped to 31 percent and 49

The average American commuter now spends 250 hours a year10

percent, respectively.behind the wheel of a vehicle; whether the value of that timeis measured in lost productivity, lost time pursuing other

Figure 2interests, or lost serenity, the cost is high. Today, those

Demographic breakdowncommuters inch along during rush hour traffic; they drive in circlesaround city streets looking for parking spaces; and, according to

Demographic Population Percentage of Totala report published by the MIT Media Lab, In congested urbanareas, about 40 percent of total gasoline use is in cars looking

Digital Natives (014 years) 49 million 16%for parking.4

Safety and the Human TollGen Now (1534 years) 84 million 28%

We pay in other important ways. In 2010, there wereapproximately six million vehicle crashes leading to 32,788traffic deaths, or approximately 15 deaths per 100,000people. Vehicle crashes are the leading cause of death for

Gen X (3544 years) 43 million 14%

Americans aged 434. And of the 6 million crashes, 93 percent

5are attributable to human error. The economic impact ofcrashes is also significant. More than 2.3 million adult drivers

Baby Boomers (4565 years) 80 million 26%and passengers were treated in U.S. emergency rooms in2009. According to research from the American AutomobileAssociation (AAA), traffic crashes cost Americans $299.5

6Older Adults (66+ years) 47 million 16%

billion annually.

The pursuit of improved vehicle safety has spurred theNational Highway Traffic Safety Administration (NHTSA) to

Denotes segment of population that is untapped today due to being below

driving agefocus attention on self-driving vehicles. As NHTSA's Associate

A percentage of older adults are driving impaired. The trend of self-driving willAdministrator for Vehicle Safety, John Maddox, explained in

provide them added mobilityearly 2012, the goal is not merely to make self-driving vehicles

A percentage of baby boomers will enter the older adults category when theas safe as human drivers, who, as the evidence shows, are

trend of self driving sees market introduction

7


6/77

not very safe at all. The goal is to develop crash-less cars.


----------------------- Page 8-----------------------

Together, the Gen Now generation and Digital NativesParking lots and garages form urban dead zones, draining the

comprise 133 million current and future drivers, or more thanvitality from city streets. In his book ReThinking a Lot (2012),

43 percent of the U.S. population. Older adults, the 47 millionEran Ben-Joseph notes, In some U.S. cities, parking lots cover

Americans aged 66 and over, face different mobility challenges.more than a third of the land area, becoming the single most

While they still cherish their autonomy, they are prone to developsalient landscape feature of our built environment.13

age-related impairments to their driving ability.In summary, current trends are unsustainable over the

Even aging boomers are increasingly distracted by cell phoneslong-term, and new alternatives are emergingnot just

and other gadgets; they, too, will soon move beyond safe drivingfrom within the automotive sector, but from a host of new

age. Among the boomers we interviewed, even those whoplayers and unlikely suspects. From universities, such as MIT,

owned premium cars said they would willingly give up driving toStanford, Carnegie Mellon, and Columbia, to leading high-tech

work in exchange for an easier commute.companies, such as Google and Intel, to start-ups, the shape of

personal mobility is changingand could ultimately transformSelf-driving cars open up new possibilities and new markets,

every aspect of how we use, purchase (or not), insure, andand not just for those who are legally eligible to drive, but also

even finance our vehicles. This transformation willfor younger people, older people, and those with disabilities. For

have profound implications for any company within thethem self-driving promises greater freedom and mobility and

automotive ecosystem.greater control over their lives.

Running Out of Space

In the early days of the automobile, America was expanding,1 KPMG Interview, 5/30/2012.

conquering the vast open spaces with a network of highways.2 Contribution of the Automotive Industry to the Economies of All Fift

y States and the United Statesth

Kim Hill, Adam Cooper and Debbie Maranger Menk. Center for Automotive Research. Prepared for TheIt was the work of the 20 century, planning and building the


7/77

Alliance of Automobile Manufacturers, The Association of International Automobile Manufacturers, The3.9 million miles of paved public roads that now connect Seattle

Motor & Equipment Manufacturers Association, The National Automobile Dealers Association and Theto Miami, Bangor to Baton Rouge, and Detroit to Mountain

American International Automobile Dealers Association. April 2010.View. Americans mythologized their cars and the freedom of

3 Using Edmunds.com TCO calculator at http://www.edmunds.com/tco.html, 7/12/2012.the open road. We shaped our towns and villages around the

4 http://h20.media.mit.edu/pdfs/wjm2007-0509.pdf.highways, building vast suburbs miles beyond our gritty urban

5 Maddox, John, Improving Driving Safety Through Automation, NHTSA, 2012.centers, adding big-box stores and mega-malls surrounded

6 http://newsroom.aaa.com/2011/11/aaa-study-finds-costs-associated-with-traffic-crashes-are-more-than-

three-times-greater-than-congestion-costs/, 6/28/2012.by acres and acres of parking lots.

7 Maddox, John, op. cit.But now population density is increasing and the trend in the

8 http://adage.com/article/digital/digital-revolution-driving-decline-u-s-car-culture/144155/, 7/18/2012.U.S. and worldwide is one of rapid urbanization. The United

9 http://www.distraction.gov/content/get-the-facts/facts-and-statistics.html.

10 Ad Age, op cit.Nations reports that 82.1 percent of Americans lived in urban

11

World Urbanization Prospects, United Nations Department of Economic and Social Affairs, 2011.areas in 2010, up from 79.1 percent in 2000, meaning that 14.1

12

Research and Innovative Technology Administration, Bureau of Transportation Statistics, http://www.percent more Americans lived in urban areas in 2010 compared

bts.gov/publications/national_transportation_statistics/html/table_ 01_11.html, 7/24/2012.to 2000. By 2020, the UN estimates that 84.4 percent of

13 Ben-Joseph, Eran, ReThinking a Lot, MIT Press 2012, http://mitpress.mit.edu/catalog/item/default.Americans will live in urban areas, with more than 28 percent

asp?ttype=2&tid=12874&mode=toc, 7/20/2012.

11living in urban areas of more than five million people.

Over the past 50 years, increased population density in theUnited States coincided with an increase in household wealthand growth in the number of multi-car families. From 1960 to2010, the number of registered vehicles in the United Statestripled, from 74.4 million in 1960 (one car for every 2.4 people)to 250.2 million registered vehicles in 2010 (one for every


8/77

121.2 people).

In some U.S. cities, parking lots cover more than a third of theland area, becoming the single most salient landscape featureof our built environment.

Eran Ben-Joseph, MIT Press


----------------------- Page 9-----------------------


----------------------- Page 10-----------------------

Self-Driving Cars: Section 2

ConvergenceCan we build a safe, self-driving vehicle? Yes. In fact, Google has already logged morethan 200,000 miles in a fleet of self-driving cars retrofitted with sensors. And Googleis not alone; traditional automakers and suppliers have also developed self-drivingfunctionality using sensor-based solutions and have a host of new applications inthe pipeline. At the same time, a number of organizations, including automotiveandhigh-tech companies and the USDOT, have been focused on the potential for using

connected-vehicle communication technologies for collision avoidance and traffic management.

What's missing, so far, is the convergence of sensor-based technologies andconnected-vehicle communications that is needed to enable truly autonomousvehicles. In this section we discuss the existing technologies, their current limitations,and why we believe they are likely to converge in the not-so-distant future.

Sensor-Based Solutions

The automotive industry is currently developing sensor-based solutions to increase vehicle safety in speedzones where driver error is most common: at lower speeds, when the driver is stuck in traffic, and at higherspeeds, when the driver is cruising on a long stretch of highway (see Figure 3). These systems, known asAdvanced Driver Assist Systems (ADAS), use a combination of advanced sensors, such as stereo camerasand long- and short-range RADAR, combined with actuators, control units, and integrating software, toenable cars to monitor and respond to their surroundings. Some ADAS solutions, such as lane-keeping andwarning systems, adaptive cruise control, back-up alerts, and parking assistance, are available now. Manyothers are in the pipeline.


9/77


----------------------- Page 11-----------------------

Figure 3: Speed zones for driver assist systems

)a

(noitnet

k up A

m lt Ja A c es a r

c s tture

ir

Bf i

a Wf

a a sp a

r tuise e r

n

r

TC C D

ro i

n

e e

v n

g

i

t t n

re


10/77

a

o

p

L

lv

ai

dr

A

t D

o e

D p tk Ass

S er i

ca s

P td t

i

n o

i

n

l

B

Low Speed (mph)High Speed (mph)(b)

Key: Industry focus speed zones

Note: (a) May not consider acceleration and driving conditions e.g., handoff of control residential versus highway

(b) Indicative of situation where driver is cruising along empty stretches of highway at steady high speeds

The next generation of driver-assist systems will likely offer Companies are also developing sensor-based, driver-assistedgreater vehicle autonomy at lower speeds and may reduce solutions, which use stereo cameras and software andthe incidence of low-impact crashes. For example, traffic jam complexalgorithms to compute the three-dimensionalassist solutions work at speeds up to 37 mph and could be on geometry


11/77

of any situation in front of a vehicle in real timethe market as early as 2013. from the images it sees.14

14 http://www.daimler.com/

dccom/0-5-1418048-1-1418642-1-0-0-1418049-0-0-135-7165-0-0-0-0-0-0-0.html

The next generation of driver-assist systems will

likely offer greater vehicle autonomy at lower speeds

and may reduce the incidence of low-impact crashes.


----------------------- Page 12-----------------------Such sensor-based systems offer varying degrees of assistance

These features are especially important for active safetyto the driver, but, in their current form, are not yet capable of

applications, because safety-critical communication mustproviding self-driving experiences that are complete and cost-

be reliable, immediate, network and device agnostic, andcompetitive. Their limitations include:

secure. Another benefit of DSRC is that it operates using free

spectrum, which is already reserved by the U.S. government fora) Perception of the external environment: So far, the fusion

transportation applications.of available sensors and artificial intelligence is not capableof seeing and understanding the vehicle's surroundings as Wi

thin the automotive industry, two entities have emergedaccurately as a human being can. Humans use a combination

for testing and developing V2V and V2I communications.of stored memories and sensory input to interpret events as

The Vehicle Infrastructure Integration Coalition (VII-C) isthey occur and anticipate likely scenarios. For example, if a

a collaboration among federal and state departments ofball were to roll onto a road, a human might expect that a child

transportation and automobile manufacturers. In 2009,could follow. Artificial intelligence cannot yet provide that level

the coalition published the results of its connected vehicleof inferential thinking, nor can it communicate in real time with

concept testing; it is now focused on policy issues that mustthe environment. These algorithms are very complex and will

be resolved before the technology can be deployed. Anotherneed to replace over 16 years of human learning, explained

group, the Crash Avoidance Metrics Partnership (CAMP)Christian Schumacher, Head of Systems & Technology for

held driver clinics in six U.S. locations as part of a Connected

15Continental Automotive Systems, N.A.

Safety Pilot.


12/77

b) Cost: Creating a 360-degree view of the vehicle'senvironment requires a combination of sensors and may costmore than consumers are willing to pay. Light Detection andRanging (LIDAR)-based systems provide 360-degree imagingbut are complex, expensive, and not yet ready for the market.The LIDAR system used in the Google car, for example,cost $70,000. Value chain stakeholders will need to have aclear and compelling business case before investing in thistechnology. (Please refer to the Adoption section for morein-depth analysis on cost and investment considerations.)

Connectivity-Based Solutions

Connected-vehicle systems use wireless technologies tocommunicate in real time from vehicle to vehicle (V2V) andfrom vehicle to infrastructure (V2I), and vice versa. (Note thatwe use the expression V2X as shorthand for communicationbetween vehicles and any other object.) According to theUSDOT, as many as 80 percent of all crashesexcluding

those in which the driver is impairedcould be mitigatedusing connected-vehicle technology.

Dedicated Short-Range Communication (DSRC), whichuses radio waves, is currently the leading wireless mediumfor V2V communication. It operates at 5.9 GHz frequency,using standards such as SAE J2735 and the IEEE 1609 suite(protocols that establish what messages are sent, whatthe messages mean, and how they are structured),16 and

is being tested rigorously to see if it can fully support V2Vcooperative safety applications. Currently, DSRC offers thegreatest promise, because it is the only short-range wirelessalternative that provides all of the following:

Fast network acquisition Priority for safety applications15 KPMG Interview, 5/2/2012.

16 Low latency Interoperability

SAE (sae.org) and IEEE (ieee.org) re two major associations of engineers and other technical

professionals who establish industry standards for engineering.

High reliability Security and privacy17 KPMG Interview, 5/2/2012.


----------------------- Page 13-----------------------

To move beyond the test phase and set the stage for self-

longer-term solution to the infrastructure investment costdriving vehicles, a number of obstacles must be overcome:

that is associated with DSRC.17 However some inherent


13/77

shortcomings exist with cellular technology for use in activea) Critical Mass: Because V2V communication requires

safety systems: it suffers from latency issues (it is too slow)other similarly equipped vehicles for sending and receiving

and has bandwidth constraints, both of which reduce itssignals, the technology will not achieve its potential until the

viability for safety-critical applications.capability is ubiquitous. That may require mandates and willcertainly require cost-effective solutions and the ability to

c) Dependency on Sensors: Although connected vehicle

retrofit existing vehicles. (For more on this topic, please see

solutions can communicate with the external environment,Section 3: Adoption.)

sensor-based solutions will need to co-exist in order to cover

situations that involve obstaclesobstructions in the road orb) Infrastructure Modifications: V2I communication for

pedestrians, for examplethat would not be connected andactive safety will require infrastructure equipped with

communicating with the network.DSRC-compliant transceivers, and the cost of building

that infrastructure may present barriers. An intermediate

Figure 4 (below) provides a framework for evaluating the

solution might focus only on crash avoidance at high-volume

pros and cons of the underlying technologies in connected-

or other critical intersections. Another solution could use

and sensor-based solutions. The ratings (low-medium-


14/77

cellular technology and its existing infrastructure for longer-

high) indicated in bright colors show areas where further

range communication and DSRC for shorter ranges. Heri

development is needed before the technologies can be used in

Rakouth, PhD and manager of Technology Exploration at

mass-market convergence-related applications.

Delphi, notes, Advances in cellular technology could be a

Figure 4: Framework for evaluating technologies

ium

ium

d

d

e

e

M

M


15/77


16/77


17/77


18/77


19/77


20/77

D

D

S

S

R

R

C

C

*


21/77


22/77

G

P

S


23/77

CEL

L

U

SL

PA

R


24/77


25/77

R

R

A

L

U


26/77

L

L


27/77

E

A

CC

R

E L

R A

R I

A M

D

D

M

A


28/77

E

A H

AH

A D

R

R i

Ri

C A

g

Ag

h

hw

R

wo

oL

L

1

1Evaluati

ve Metric: COST

Evaluative Metric: RELIABILITY


29/77

ium

ium

d

d

e

e

M

M


30/77


31/77


32/77


33/77


34/77


35/77


36/77


37/77


38/77

S

CELL

D

U

L


39/77


40/77

U

LR MER

A A

LA C


41/77

ED

I

C

LA

A


42/77

AD R

R

R

E

R


43/77

MA

G HA D

H

P i

i

g

g

C A

S h


44/77


45/77

vehicle technologies and sensor solutions would provide aand complexity of stand-alone solutions. Adding DSRC would

necessary level of redundancy.eliminate the need for the more expensive sensors and bringdown the cost of the overall package.

d) Infrastructure Investment: Connected vehicle solutions

require large-scale infrastructure investments. Convergenceb) Proxy for Human Senses: Convergence would increase

could help mitigate some of this requisite investment bythe inputs that are available for decision making and reduce

covering some use cases using sensors.the need for more sophisticated artificial intelligence. Thecombination of sensors and connected-vehicle solutionswould allow self-driving vehicles to collect the requisite

Figure 5: Benefits of convergenceSensor-Bas

ed Solution Only

Cannot sufficiently mimic human senses

Not cost-effective for mass market adoption

Lack of adequate 360 mapping of environment in urban grids

ConnectedVehicle Solution Only

DSRC does not currently work with pedestrians, bicyclists, etc.

DSRC-basedV2I might require significant infrastructure investment

V2V requires high market penetration to deliver value reliably

ConvergedSolution

Convergence will facilitate adequate mimicking of human senses

Convergence will reduce need for an expensive mix of sensors

and reduce the need for blanket V2I investment

Convergence will provide the necessary level of functional

redundancy to ensure that the technology will work 100 per cent


46/77


47/77

ym Autonomouso Adaptive Cruise Cooperative

Platooningn Controlo Adaptive Cruis

et t Control (CACC

)u sa i

sf s

o AIntelligent Inters

ectionee Speed Adaption Movement

Assist rge g

nD i

nra

W/

n Autonomous Electronic EmergencyCooperative Collision

oi Warning Systems Brake Light

Warning Systemtamro

fn

I

Degree of cooperation

Key: Indicates DOT focus application for connected vehicles


----------------------- Page 16-----------------------


Adoption

Assuming the technologies mature, convergence occurs, and connected, self-driving


48/77


49/77

for mass deployment,19 stated Hideki Hada, Toyota. On the next page we describe a baseline adoption

scenario, an aggressive one, and a conservative one.

Focused and phased introduction is a realisticpath for mass deployment.

Hideki Hada, General Manager, Integrated Vehicle System Dept., Toyota

19 KPMG Interview, 5/16/2012.


----------------------- Page 17-----------------------

Early applications Adoption levels No change No change

sell the promise out as a

ftermarketAGGRESSIVE SCENARIO of self-driving retrofit is gradually

completed

Consumersn embrace tangible

Adoption densityo

it benefits reaches critical

po mass

d NHTSA issuesAf NRI followed by Adoption and speed

o immediate V2V of change eventually

et mandate that level off

aR includes aftermarket

component

Technologybreakthroughs leadto even greater

Time value for V2Xsolutions

Early applications Assist systems Adopton plateaus Private enterprise

sell the promise providegreater due to lack of V2X introduces

BASE CASE SCENARIO of self-driving value proposition to functionality in aftermarket

vehicles. cons


50/77

umers aftermarket solutions

n Consumers excited Early adopters flock Aftermarket retrofit

oi by tangible benefits to new offerings reaches requiredt

pdensity for `control'

o NHTSA issues NRI NHTSA issuesdA V2Vmandate but appsf

o without aftermarket Adoption eventually

e component levels off (nott

aR

necessarily at

100 percent

participation)

Time

Initial adoption Unfavorable NRI Slow rise in Adoption levels

slow due to lack causes adoption adoption as never reach critical

CONSERVATIVE SCENARIO of consumer to plateau due to sensor mass for self-driving

enthusiasm lack of consumer technology due to lack of V2X

for early assist interest in available improves capability

no and information sens

or-basedit systems solutions

po

d NHTSA issuesAf NRI unfavorable

obecause DSRC not

et seen as viable for

aR V2V


51/77

Time


----------------------- Page 18-----------------------

Pieces of the Puzzle

of the underlying sensor-based technologies exist, althoughThe adoption of most new technologies proceeds along an

not all of them are robust enough to be considered automotiveS-curve, and we believe the path to self-driving vehicles will

grade. They will require further testing and validation and willfollow a similar trajectory.20 It will be the confluence of multiple,

be subject to the automotive industry's long development and

interdependent activities and forces, including regulatorysourcing cycles.action, business cycles, technological advancements, andmarket dynamics, that will ultimately determine the trajectory

Nonetheless, we believe that sensor and connected-vehicle

technologies will continue to develop and converge, leadingand speed of market adoption. (See opposite page for our take

to an eventual inflection point beyond which it is likely that theon three possible adoption scenarios.)

driver will increasingly be taken out of the loop.As we noted in the previous section, several sensor-basedautomated driving applications, such as Adaptive CruiseControl and Park Assist, are in use today, and the automotive

20 As C.S. Smith described it in his book, A Search for Structure, The S curvecan be used to

apply to the nucleation and growth of anything, really any thing that hasrecognizable identityindustry and technology firms are already working on more

and properties depending on the coherence of its parts. It reflects theunderlying structural

conflicts and balance between local and larger order and the movement of interfaces in responsesophisticated solutions. While the available technology does

to new conditions of components, communication, cooperation, and conflict. (http://inside.mines.not yet enable self-driving, it is moving in that direction. Most

edu/~meberhar/new1/classes/down_loads/smith.pdf), 7/20/2012.

Figure 7 Pieces of the Adoption Puzzle


----------------------- Page 19-----------------------

Laying the Groundwork: Engaging ConsumersSelling the Value Proposition: To adopt the new technologies


52/77

and embrace fully self-driving vehicles, consumers will needEven if the current technological limitations did not exist, it

to see real value for each new feature they buy. The industry'swould be necessary and even preferable to introduce self-

ability to deliver an attractive value proposition, customizeddriving capabilities gradually. Doing so would still provide

for different segments of the market, will drive consumers'benefits to vehicle operators and the transportation network,

willingness to pay and, therefore, will be critical to widespreadand provide time for consumers to learn about and begin to

adoption. Younger generationsthose within the Digitaltrust the technology.

Natives and Gen Now cohortswill likely be the most receptiveBuilding Trust: There is no margin for error with safety-criticalto self-driving, but they also comprise the market segment withtechnologies. They must work perfectly every time; life andthe least purchasing power. Therefore, the industry will need todeath hang in the balance. Consumers will not relinquishprice these packages accordingly.control until they are certain their vehicles and the mobile

One potentially attractive pricing scenario would be to have aenvironment are 100 percent safe and reliable. But John

baseline set of self-driving features that would be standard inAugustine, managing director of USDOT, is optimistic. When

every vehicle, and then include a menu of options that couldpeople can see what the car can see, they are convinced, hesaid at the 2012 Driverless Car Summit.21 The ramificationsbe priced as self-driving on the go (similar to premium trim

options). Such a tiered pricing model could speed adoption byof an early autonomous or connected-vehicle traffic crash

providing affordable options for a broader range of customers.could be calamitous. Bad publicity is a significant risk for the

Baseline features could potentially be spelled out in adeployment of innovative automotive technology, even if the

government mandate.technology itself is not the cause.

Facilitating a Learning Curve: Autonomous vehicleWhen Antilock Braking Systems (ABS) were first introduced,

technology will revolutionize the driving experience, andnegative publicity and poor consumer education delayed

consumers will need time to learn how to use and managemass-market adoption. Similarly, when Electronic Stability


53/77


54/77

urban areas. This approach might obviate the need for broadertechnology requires a large network of vehicles equipped with

infrastructure investment and create inducements for othersimilar, or at least interoperable, communication systems.

cities and individual consumers to adopt the technology. ThisWith high degrees of vehicle autonomy comes the need for

is especially feasible in high-density areas such as the boroughhigher degrees of cooperation and, hence, higher levels of

of Manhattan, where drivers could reap the benefits of V2Iadoption density to deliver the technology's full value and

communication without the need to retrofit all of New York City.potential. Density is critical for V2V safety applications and forautomated driving. Some monitored automation applications Bringing Costs Down: According to research conductedhave cooperative features, which require minimal levels of by

J.D. Power and Associates,24 20 percent of consumersadoption density to deliver on their value proposition.

surveyed said that they would definitely/probably be willing to

pay as much as $3,000 for autonomous driving applications.Enabling the Aftermarket: A viable aftermarket solution is

23However, today's more advanced sensors, such as LIDAR,

a key to adoption, says Doug Patton, DENSO's senior vice

cost tens of thousands of dollars. As convergence of the twopresident of Engineering. Without a viable aftermarket solution

technologies occurs, fewer sensors would be needed, perhapsto retrofit vehicles already on the road, it will take a longer

bringing the total cost down to $1,000 to $1,500 per vehicle,time to achieve the necessary critical mass. While a significant

as economies of scale are achieved. When the pricing is right,number of aftermarket vehicles will need to have fully enabled

the rate of adoption will likely increase, enabling users todevices for V2X communication, a portion of them will only

realize greater value from V2V communication and creating aneed to have comparatively dumb devices that transmit

reinforcing effect. As more people adopt the new technologies,their location.

greater economies of scale will bring costs down, attracting still

more consumers.

23 KPMG Interview, 5/4/2012.

24 J.D. Power and Associates, 2012 U.S. Automotive Emerging Technologies Study.


55/77


----------------------- Page 21-----------------------

Developing a Legal and Regulatory Framework Incentives: If NHTSA does not issue a full mandate for

V2V safety, it's possible that the agency might instead offerStates and Local Laws Legislation, or lack thereof, will impact

incentives to automakers who introduce convergence-basedthe speed and trajectory of adoption. To some extent, states

solutions and to consumers who are willing to buy them.such as Nevada are ahead of the curve, having already passed

Incentives would be less powerful than a full mandate, butlegislation that permits licensing and operation of autonomous

would, nonetheless, have broad effects on the industry,vehicle licenses. These actions help focus greater attention on

because they would likely enable first-mover advantages forthe emergence of self-driving vehicles and create environments

manufacturers that are further ahead in the development lifewhere further testing and validation of the technologies can

cycle of V2V technologies and self-driving solutions.occur. However, private enterprise will still need to play a role indeveloping products and concepts that facilitate consumer pull. ALegal Framework: If the driver, by design, is no longer inIf this happens, it could motivate regulatory agencies to issue control, what happens if the vehicle crashes? The drivernecessary regulations. As the director of the Nevada DOT put could well be an innocent bystander or might at least bearit, Make a [self-driving] product that the consumer wants, and lesser liability than drivers do today. A legal framework will bewe will adapt and follow. And as more states establish policies, necessary to deal with the potentially complex liability issuesfederal regulators may be compelled to act to ensure a uniform that may come with self-driving cars.and cohesive approach.

Insurance underwriting will be another thorny issue. InterviewsA Federal Mandate: Automotive suppliers and vehicle

with insurance risk firms indicate that the entire underwritingmanufacturers believe a government mandate requiring that

process will need to be revamped, and a greater portion ofvehicles be equipped with V2V safety technology (just as

the liability could transfer to manufacturers and infrastructureseatbelts and airbags are now mandated) will be instrumental

providers (federal and state). These legal concerns, and thein motivating the automotive value chain to invest in developing

qu


56/77

estion of who owns the risk, will need to be addressedconvergence-related technologies. Any such mandate or seriesof mandates will also need to encompass criteria that will drive for convergence solutions to gain mass-market adoption.development across the industry. Litigation-related issues that come with widespread use of

autonomous vehicles will be a challenge.In fact, USDOT has already launched a Connected VehicleSafety Pilot Program, and NHTSA will use data from the pilot asimportant input for determining if a Notice of Regulatory Intent(NRI) regarding V2V safety will be announced in 2013. NHTSA'sregulatory approach could evolve along one or more of several The advantage of a mandate is that itpossible paths: mandatory deployment of the technology,voluntary installation of wireless devices in new vehicles, or would spur development across theadditional research and development. industry and expedite adoption of

An affirmative NRI in 2013 is likely to be succeeded by therelease of specifications in 2014 or 2015. Assuming a four- convergence solutions.year vehicle development cycle, the first vehicles with built-inV2V and V2I capability could launch in 2019, perhaps sooner ifmanufacturers opt to pursue DSRC with or without a mandate.

The advantage of a mandate is that it would spur developmentacross the industry and expedite adoption of convergencesolutions. Figure 8, on page 22, shows a potential time line forintroduction of V2X-based applications, assuming a favorabledecision by NHTSA in 2013.


----------------------- Page 22-----------------------

Figure 8 Shows a potential time line for2025

introduction of V2X-based applicationsSufficient built-in and after-market penetration

to support self-driving applications

2018/2019Launch of first vehicleswith V2V/V2I capability

2014/2015Final proposed rule making

2014

NHTSA issues draft

proposed rulemaking


57/77

2013

NHTSA Notice of

Regulatory Intent

Note:(*) Assuming average three-yearvehicle development cycle toaccommodate testing, validation, etc.

(*) Assumes mandate will hasteninvestment an enabling technologies


----------------------- Page 23-----------------------

Spurring the Necessary Investment Conclusions

But relying on government spending is a risk. Given a sluggish We believe convergence of sensor-based and connected-economy and widening state and federal budget deficits, vehicle technologies will happen and will have a positivethe appetite for infrastructure investment is likely to be low. effect on the adoption of both systems. We think drivers willInterviews with industry participants indicate that a purely take the leap. Convergence will bring enhanced mobility andDSRC-based system might require a multibillion-dollar safety and reduced environmental impacts. It may also haveinvestment on a national level. far-reaching implications for the traditional automotive value

chain and beyond.

These costs could be mitigated by leveraging some of theexisting cellular infrastructure. Doing so would be possible Automotive and technology companies are already investingonly if a combination of DSRC and cellular (or an alternative in connected andautonomous technologies and applications.technology) is proven viable for short- and long-range While there is noclear leader, companies are trying to figurecommunication, respectively. The likely outcome is out how to compete and collaborate at the same time. Wesomewhere in between, with DSRC infrastructure present believe that overthe longer term, the evolution of theseat important intersections and other critical nodes within the advancements will cause a rebalancing of the automotive valuetransportation system. chain, with nontraditional firms playing a more significant role.

We explore these implications in the next section.If slow economic growth continues, it would likely curtailcapital spending, especially by automotive companies, whichstruggled during the recent recession. It is unlikely that Figure 9 Shows the various facets and forces that must cometraditional automotive companies would be willing to spend together to enable self-driving.heavily on technologies for which the ROI time line is unclear.On the other hand, companies that fail to invest


58/77

er Acs

um cecould find themselves falling behind and losing n

pto

aC

n

cmarket share as the self-driving trend gains

e

traction.Information

Political Will: Regulations and planning at the tn

federal level are subject to elections and changes e mt

Assistin the political climate. Because 2012 is an election s

Ie

vn

year, a change in governing partyor even at

n se

Id

gchange in leadership at the helm of USDOT e e

rr

iB s

Contro t

ycould affect funding, prioritization, and timing of a u t b

lt

s uc e H

S oconnected vehicle mandate. A lack of government u T l

e fr l a e

C n T

sd

D e


59/77

support could be a significant obstacle to adoption. t a n io

oo

Ss

n cc i w

v rn

R ha o g

e s

oC

r L e it

r n

gf R a

ne o

nI N

Self

c l

e o

Driving g

y

L Fe e

g dy

i er

ts r

sl a

uD a l

dt

ni


60/77

IS o

w lR n

Ne e

dS C

ot M

Ma a

st n

se d

ea

n

tiT e

se

u

Bs

Newt

sL i

rn

ee g

yg L

ai

li c

Ps e

l nw

a se m

t eN e

it

os

ny

s


61/77

o

c

E

Today Medium Term Long Term

----------------------- Page 24-----------------------


Implications for investment

In the new world of self-driving (autonomous) cars, who will design and manufactureautomobiles? Who will design the consumer experience? Who will own the

aspirational brands? Will the automotive brands still matter? If so, how will they adaptto maintain competitive advantage? Who will lead in this evolving ecosystem?

These questions and others abound, as various participants in the automotiveecosystem grapple with the impact of these potentially disruptive new technologies.Intel, for example, recently launched a $100 million Connected Car Fund because, says Mark Lydon, director at Intel Capital, Intel is looking to apply its expertisein consumer electronics and systems intelligence to the development of smartervehicle technologies that seamlessly blend IT, CE, and next generation ADAS whilemaintaining optimal safety. The Connected Car Fund was created to further this visionand spur greater innovation, integration, and collaboration across the automotivetechnology ecosystem.25

What's clear is that the convergence of sensor-based safety systems and connected

vehicle technology will have far-reaching implications as the technology matures andbecomes pervasive. Below, we have listed a number of major implications that, in ourview, represent significant paradigm changes for the vehicle transportation ecosystemas a whole. Some will offer enormous economic and social benefits, while otherswillpresent significant challenges for society:

Crash Reduced Need forData New Models

Elimination New InfrastructureChallenges for Vehicle

Ownership

E F


62/77


63/77


64/77

know how to avoid conflicts with other vehicles. Simulations ofare designed for human driverswho are

intelligently controlled intersections indicate that such a systemtoo often inexperienced, distracted, or impaired. Thus, today's

could perform 200300 times better than current traffic signals.30roadways and supporting infrastructure must accommodatefor the imprecise and often-unpredictable movement patterns

The convergence of sensor-based safety systems and connectedof human-driven vehicles with extra-wide lanes, guardrails,

vehicle technology could also assist transportation agencies withstop signs, wide shoulders, rumble strips and other features

asset management and reduce maintenance costs. Vehiclesnot required for self-driving, crashless vehicles. Without those

could report road or weather conditions back to transportationaccommodations, the United States could significantly reduce

agencies, which could then rapidly address issues such as roadthe more than $75 billion it spends annually on roads, highways,

deterioration or icy conditions. Additionally, autonomous vehiclebridges, and other infrastructure.27

traffic could automatically be rerouted around problem areas, ifnecessary, while maintenance crews address the problem.

An essential implication for an autonomous vehicle infrastructureis that, because efficiency will improve so dramatically, traffic

Parking, too, will be affected. Vehicle sharing would keep vehiclescapacity will increase exponentially without building additional

in more constant use, serving more people and reducing demandlanes or roadways. Research indicates that platooning of vehicles

for parking infrastructure. Vehicles, now built via just-in-timecould increase highway lane capacity by up to 500 percent.28 It

systems, could now reach travelers using similar logic.

may even be possible to convert existing vehicle infrastructureEven a 10 percent reduction in need for infrastructure

to bicycle or pedestrian uses. Autonomous transportationinvestmenta conservative estimate relative to such a

infrastructure could bring an end to the congested streets anddramatic change in needswould result in savings of $7.5

extra-wide highways of large urban areas. It could also bring thebillion per year, or $75 billion per decade compared to current

end to battles over the need for (and cost of) high-speed trains.infrastructure expenditures.

Self-driving vehicles with the ability to platoonperhaps inspecial express lanesmight provide a more flexible and lesscostly alternative.


----------------------- Page 27-----------------------

Data ChallengesData Analytics and Aggregation: It is possible that individual

privacy is threatened less by the collection of public locationAn enormous amount of data will become

information than by the aggregation of information, combiningavailable for alternative usage, which is likely

location and route data with other personal information.


65/77

to present challenges and opportunities

Current laws may not be equipped to adequately addresspertaining to data security, privacy concerns,

new technologies and the growing data industry. Large-scaleand data analytics and aggregation.

data mining and analytics techniques have been highlighted inData Security: Numerous security threats will arise once

newspaper headlines of late, stirring much concern over thepersonal mobility is dominated by self-driving vehicles.

power of aggregation and analytics. Consumer and privacyUnauthorized parties, hackers, or even terrorists could capture

advocates are already calling for more transparency amongdata, alter records, instigate attacks on systems, compromise

data brokers and requesting that these firms publicly revealdriver privacy by tracking individual vehicles, or identify

information on the data they collect, how they collect it, who has

residences. They could provide bogus information to drivers,access to it, and how it is used. In early 2012, the Federal Trademasquerade as a different vehicle, or use denial-of-service

Commission issued a report urging greater transparency fromattacks to bring down the network. The nefarious possibilities are

data brokers.mind-bogglingthe stuff of sci-fi thrillers. But system security

Though many view large-scale data aggregation as intrusive,will undoubtedly become a paramount issue for transportation

manipulative, and an invasion of privacy, it has its benefits as well.systems with the successful deployment of integrated sensor-

Location and route information collected from vehicles allowsbased and cooperative vehicles.

for numerous types of location-based services (LBS) that maySecurity systems protecting against such threats could include

be personalized for travelers. The Pew Research Center reportscharacteristics such as data sanitization (e.g., removal of

that, as of 2012, three-quarters of smartphone users use location-identifying information) and data suppression (e.g., reducing

based services, up from just over half of smartphone users insampling frequency). They could aggregate data (possibly within

2011. As consumers and businesses become more comfortablethe vehicle rather than having the vehicle transmit large quantities

with new technology, the field of location-based services is set toof raw data). They could use vehicle authentication, encryption,

continue expanding.tamper-proof hardware, real-time constraints, user-defined

Beyond direct traveler services, acquisition and use of data couldprivacy policies (allowing data handling preferences for each

be beneficial for businesses, government agencies, universities,user), and defense-in-depth (meaning each layer of hardware and

economic developers, nonprofit groups, and other organizations.software would provide its own security functions).


66/77

Data could be used by state departments of transportationNew threats to personal privacy: Even now, with pervasive

or other road managers to analyze road use patterns and planconnectivity in and outside of our vehicles, we are finding

maintenance and improvements. Licensing agreements couldit increasingly difficult to preserve our privacy. As the use

allow organizations access to vehicle and travel route data underof autonomous and connected vehicle solutions expands,

controlled conditions and for legitimate purposes. Sharing couldmaintaining individual privacy within the transportation system

be done through the data collecting agency itself, or may involvemay become even more arduous. Although the increased use of

a third party that would gather data, remove any individuallysensing, tracking, and real-time behavior evaluation

identifiable information, and make it available to interestedcreates new privacy issues as well as ethics and policy

organizations. Such work is already being done with certain datadilemmas, the benefits to be derived from vehicle sensor and

sets with organizations.

communication technologies make them an appealing pursuit formost stakeholders.

Privacy concerns must be resolved to enable the deployment of27

Includes federal, state, and local expenditures.integrated sensor-based and cooperative vehicle technologies.

28 Platooning With IVC-Enabled Autonomous Vehicles: Strategies to Mitigate CommunicationA balance between privacy protection interests and other

Delays, Improve Safety and Traffic Flow. IEEE TRANSACTIONS ON INTELLIGENT

TRANSPORTATION SYSTEMS, VOL. 13, NO. 1, MARCH 2012. Pedro Fernandes, Member,affected interests is essential to resolve conflicts between the

IEEE, and Urbano Nunes, Senior Member, IEEE.stakeholders who will make decisions about how information

29 Transportation Research Board, Highway Capacity Manual, 5th Edition. 2010.is collected, archived, and distributed. Potential stakeholder

30 Multiagent Traffic Management: A Reservation-Based Intersection Control Mechanism. In

The Third International Joint Conference on Autonomous Agents and Multiagent Systemsconcerns are numerous: disclosure of vehicle data could reveal

(AAMAS 04) pp. 530-537, New York, New York, USA, July 2004. Kurt Dresner and Peter Stone,trade secrets; public personalities, such as politicians and

University of Texas at Austin Department of Computer Sciences.

celebrities, could be connected to potentially embarrassinglocations or routes; and ordinary citizens could find themselvesspammed or stalked as the data enables a variety of harmfulapplications such as commercial misuse, public corruption,and identity theft. And what's to prevent nefarious governmentsfrom using the expanded surveillance capabilities to spy ontheir citizens?


67/77


----------------------- Page 28-----------------------

New Models for VehicleBut many other variables will affect global demand for vehicles.

OwnershipPricing is a significant variable that could dramatically change

the demand curve. If prices for a basic autonomous vehicle fellSelf-driving vehicles could contribute

below $10,000, for example, ownership would be within reachto a significant redefinition of vehicle

for a much broader segment of the world's population. And asownership and expand opportunities

vehicle ownership becomes possible for previously excludedfor vehicle sharing (imagine Zipcar on

demographic groupsyounger and older drivers, those with

steroids). If vehicles can drive themselves, they can bephysical limitations, and those with fewer resourcesthesummoned when needed and returned to other duty when

resulting increase in demand could help offset some of thethe trip is over. Thus, travelers would no longer need to own

aforementioned decreases.their own vehicles and could instead purchase mobilityservices on demand.

Travel Time Dependability

Even when vehicle usage is at its peaknear 5:00 p.m. in theAnticipated travel time is the most useful

U.S.fewer than 12 percent of all personal vehicles are on theinformation to support trip decisions

road, which means, of course, that 88 percent are not in use.and assess the operational status of a

(Not all of those vehicles would be available for sharing at anytransportation network, and convergence

given time; the composition of the 12 percent changes as tripsprovides the opportunity to eliminate,

begin and end, and vehicles would need time to travel fromor at least substantially reduce, uncertainty in travel times.

the end of one trip to the beginning of the next.) Self-drivingNonrecurrent congestion can account for as much as 30 percent

vehicles could be used more efficiently throughout the dayof the delay faced by drivers.31 In addition, with unpredictable

instead of being parked most of the day and night. This wouldtraffic patterns, traffic congestion can occur at any time of day. In

require new models for vehicle insurance and maintenance butlarge urban areas such as Los Angeles, rush hour congestion

would also provide multiple new business opportunities.regularly lasts more than six hours, and approximately 40 percent

of total traffic delay occurs in off-peak hours when travelers and

freight companies expect relatively free-flow conditions.32

With the surface transportation network composed of self-


68/77


69/77

amounting to a cost of more than $100 billion annually in delay

of Facebook.and fuel, $23 billion of the delay cost can be attributed to theeffects of congestion on truck operations.

An automated transportation system could not only eliminatemost urban congestion, but it would also allow travelers tomake productive use of travel time. In 2010, an estimated 86.3In 2010, an estimated 86.3 percent ofpercent of all workers 16 years of age and older commuted toall workers 16 years of age and olderwork in a car, truck, or van, and 88.8 percent of those drove alone,while the remaining 11.2 percent traveled in a carpool. Thus,commuted to work in a car, truck,conservatively, more than 90 percent of workers 16 years or olderor van, and 88.8 percent of thosedrove a car, truck, or van to work. A driver loses productivity whilecommuting, because attention must be given to driving. The

drove alone, while the remaining 11.2average commute time in the United States is about 25 minutes.percent traveled in a carpool.Thus, on average, approximately 80 percent of the U.S. workforce loses 50 minutes of potential productivity every workday.


----------------------- Page 30-----------------------


----------------------- Page 31-----------------------

Improved Energy EfficiencyPotential New Business Models

E F Would fuel prices plummet? WouldIn today's consumer-driven technology

CAFE (Corporate Average Fuel Economy)world, smart phone and tablet makers tu

rnstandards disappear? Consider how much

out new models every year (at least) to feed

more energy-efficient transportationtheir tech-hungry consumers with the lat

estwould be in the post-convergence world.

and greatest. Will the same phenomenonA transportation system composed of self-driving vehicles

begin to occur in the driverless era? We think so. Consumers willwould decrease energy consumption in at least three primary

expect the latest gadgets in their driverless carsand that meansways: more efficient driving; lighter, more fuel-efficient vehicles;

a new landscape and new business pressures for current playersand efficient infrastructure. The energy policy and geopolitical

in the automotive ecosystem. As Larry Burns puts it, Incumbent


70/77

34implications could be profound.

players rarely do well when industries disrupt. There are many

industries involved in this complex ecosystem of self-driving,In an autonomous vehicle transportation system, vehicles will

each with a varying pace of speed and innovation. Convergencenavigate far more efficiently than current human operators do.

of technologies may lead to convergence of industries in whichThe inefficiency of human-driven vehicles leads to considerable

ecosystem participants will need to compete and collaborate atcongestion at high traffic volumes and frequent traffic jams. In

the same time. There will be more pressure than ever to innovateits 2011 Urban Mobility Report, the Texas Transportation Institute

or get left on the scrap heap of outdated technologies. The varying estimated that congestion costs Americans 4.8 billion hours of

capabilities, willingness, and foresight of the various ecosystemtime, 1.9 billion gallons of wasted fuel (equivalent to two months'

participants will ultimately answer many of the questions posedoperation of the Alaska Pipeline), and $101 billion in combined

by the coming convergence. Who will play the leading role in thisdelay and fuel costs. That's $713 per year for each commuter.

ecosystem when self-driving becomes a reality? Who will createEven the most fuel-conscious human drivers could not match

value, and who will claim it in the self-driving ecosystem?the fuel efficiency of autonomous cars communicatinginstantaneously and continuously within a connected andcontrolled infrastructure. Platooning alone, which would reduce

27 Includes federal, state, and local expenditures.

31

Skabardonis, A., P. Varaiya, and K. F. Petty. Measuring recurrent and nonrecurrent trafficthe effective drag coefficient on following vehicles, could reduce

congestion. Transportation Research Record. 1856, 118-124, 2003.

32highway fuel use by up to 20 percent (just as drafting behind

Texas Transportation Institute (TTI). Urban Mobility Report. Sept 2011. , 7/12/2012.

33

Twenty percent is an accepted estimate based on field tests by PAT


71/77

H (California) and in thetraffic congestion would be a thing of the past; stop signs and

European SARTRE project (Volvo, Ricardo, etc.). Most of the sources are project web sites.intersection queuing could also disappear.

Vaughan, Michael. The Globe and Mail [Toronto, Ont] 08 June 2012: D.6.

34 Comment made during presentation NADA/IHS Automotive Forum, NYC, April 3 2012.

Vehicles could also be significantly lighter and more energyefficient than their human-operated counterparts as they nolonger need all the heavy safety features, such as reinforced steelbodies, crumple zones, and airbags. (A 20 percent reduction inweight corresponds to a 20 percent increase in efficiency.)

And we could even turn off a few lights. Today's roadways and

Congestion costs Americans 4.8supporting infrastructure are designed for human driverswhobillion hours of time and 1.9 billion

need visual input to navigate. Thus, multiple electric traffic lightsoperate 24/7 365 days a year at every controlled intersection

gallons of wasted fuel.across the U.S. (Even in times of low traffic volumes, the signalsmust at least flash.) Across the nation, our streets, intersections,and highways are brightly lit all night for the benefit of humandrivers. An autonomous vehicle, capable of seeing withinfrared, radar, or other means, would have no need for suchexcessive lighting and signals. We could design our night lightingfor safety and security, rather than vehicles. Converting thetransportation infrastructure for autonomous vehicles couldeliminate the need for much of the night lighting across thenation, reducing light pollution and energy use.


----------------------- Page 32-----------------------

Who will make and sell carsin the future?

Imagine a new automotive ecosphere in which manufacturing is nolonger a core competency and consumer demand for the newesttechnology is as avid as demand for the latest, greatest videoconsole or smart phone. Who will make and sell cars? Who willget left behind? What kinds of strategic alliances, joint ventures,or mergers will reshape the competitive landscape? Will newconsumer products companies enter the market? In pondering thesequestions, we've identified four potential new business models.

Incumbent players rarely do well whenindustries disrupt.

Larry Burns, Co-Author of Reinventing the Automobile: Personal UrbanMobility for the 21st Century


72/77

The Branded Integrated Life-Style Model The OpenSystem Model

It's a sleekly designed experience, riding in this self-driving car. It's all about the data and how to use these data to customizeAs elegantly designed as the sleekest smart phone. You use the consumer value proposition. The market for big dataan app on your phone to summon your car when you need it is growing exponentially. Market intelligence provider IDCor to program a daily pick-up. It's as simple as setting the alarm predicts that by 2015 the Big Data market will be $16.9on your phone. Your windshield doubles as a screen, synching billion,up from $3.2 billion in 2010.35 A major player in the data

seamlessly with your other connected devices. As you ride market might not want to manufacture vehicles, but couldalong, you swipe through applications and web sites, checking well design a vehicle operating system. With more than ayour progress and the local weather on a digital dashboard, billion c

ars serving up trillions of data points about consumeruploading photos to your favorite web site or watching a video. behavior, traffic patterns, and topography, an operating systemWhen you arrive at your destination, the screens you've opened (OS) developer could afford to give away the OS but accrueare synched and waiting for you on whatever device you pick significant value from the data they could aggregate. Whoup next. would manufacture the vehicle? The OS provider could partner

with anyof the world's vehicle manufacturersand not just theIn this model, perhaps a company with no traditional traditional automotive manufacturers. Partnerships could bepresence in the auto industry that is already an integral part established with one or more new players who might competeof the consumer's life outside the vehicle could become a in the branded technology arena.key participant in the ecosystem. Since self-driving vehicleswill no longer need the same level of rigorous testing and The OpenSystem Value Proposition: Utility, Technology,validation, and manufacturing could potentially be outsourced, Customizationtheir emphasis would be on consumer research, productdevelopment, and sale of integrated lifestyle experiences.

The Branded Lifestyle Value Proposition: Design, Technology,Software, Consumer experience


----------------------- Page 33-----------------------

The Mobility On Demand ModelThe OEM Model

Zipcar was the pioneer in the shared-vehicle field, but otherTraditional automotive manufacturers have decades of

players are breaking into the market. Whereas current mobilityexperience in designing and manufacturing vehicles, and

on demand providers must make vehicles easily accessibleshaping an emotional connection with consumers. But will they


73/77

for customers in urban areas, their vehicle maintenance andmove fast enough to maintain their brand dominance? Smart

parking fees are high. With self-driving vehicles, proximity toautomotive manufacturers should be planning now, thinking

end-users would no longer be necessary. Vehicles could beabout how to restructure their organizations and what potential

dispatched by taxi and car service companies.strategic investments they should be making. History has not

been kind to those who get stuck protecting the status quo inGiant retailers with a core competence in managing complex

the face of disruptive change. In fact, collaboration is alreadydistribution channels or fleet providers with the capability

taking place across the ecosystem as companies strive toto manage the complexity of renting and allocation of fleets

stay relevant. The joint project between Intel and DENSO36 to

could enter the fray and accrue significant value in the newdevelop in-vehicle communication and information systems

ecosystem. New entrants in the market might compete atexemplifies the new cross-industry synergistic relationships.either end of the spectrumwith generic, low-cost utilitariantransportation on demand at one end (the low-cost airline

Vertical integration is an option for companies looking tomodel) and super-luxury mobile executive suites and sleeping

bring a critical skill or technology in house. Some vehiclepods at the other (the first class or private jet experience).

manufacturers have established venture capital subsidiariesSuccess will be determined by efficiency, reliability, flexibility,

to invest in promising new technologies as a means ofvehicle maintenance, customer service, ease of human-vehicle

bridging any skill or technology gaps. Doing so may provide ainterface, and integration with existing consumer devicesand

competitive advantage in this rapidly evolving ecosystem.all the other psychographic factors that determine consumerbehaviors and brand preferences.

The OEM Value Proposition: Design, Technology, HMI, Supply

Chain ManagementThe Mobility on Demand Value Proposition: Flexibility,Reliability, Convenience, Cost

35 IDC Press release (March 7, 2012), http://www.idc.com/getdoc.jsp?containerId=prUS23355112,

7/10/2012.

36

http://newsroom.intel.com/community/intel_newsroom/blog/2012/03/01/chip-shot-intel-and-

denso-collaborate-on-automotive-research.


----------------------- Page 34-----------------------


74/77

Appendices

Pros and Cons of the Technologies in Development

The table below shows the potentially applicable technologies, their strengthsand limitations, and the key players developing them.

Technology What It Does Limitations & Opportunities Key Players

LIDAR Light Detection And Ranging. Noise removal. Interpolation Siemens, Hella, Google

An optical remote sensing to fixed point spacings.

technology that measures Triangulation issues.

distance to a target or otherproperties of the target by

illuminating it with light.GPS The Global Positioning System The a

ccuracy of a GPS receiver Garmin, TomTom, Parrot, Apple,is a space-based satellite is a

bout +/- 10 meters, not Google, Governmentnavigation system that pract

ical for locating an objectprovides location and time the s

ize of an automobile, whichinformation anywhere on or is a

bout 3 meters long.near the earth.

DGPS Differential Global Positioning The DGPS correction signal Government

System is an enhancement loses approximately 1 meter

to GPS that improves location of accuracy for every 150 km.

accuracy from +/- 10 meters to Shadowing from buildings,

about 10 cm. underpasses, and foliage causes

temporary losses of signal.

RTK Real Time Kinematic satellite The base station rebroadcasts N/A

navigation is based on the use the phase of the carrier that it

of carrier phase measurements measured; the mobile units

of the GPS, GLONASS, and/or compare their own phase

Galileo signals where a single measurements with the ones

reference station provides the received from the base station.

real-time corrections.


75/77

Digital Maps Digital mapping (also called Only some parts of the world Google, TomTom, Microsoft,

digital cartography) is the have been mapped (mainly Navteq, Apple

process by which a collection of urban areas), and there is a need

data is compiled and formatted for a critical mass of mappers to

into a virtual image. enter and cross-validate data in

order to achieve a satisfactory

degree of accuracy.


----------------------- Page 35-----------------------

GlossaryGlossary of Terms

3G Third Generation of Mobile Telecommunications

4G Fourth Generation of Mobile Telecommunications

AAA American Automobile Association

ABS Antilock Braking System

ADAS Advanced Driver Assist Systems

AHS Automated Highway Systems

CACC Cooperative Adaptive Cruise Control

CAFE Corporate Average Fuel Economy

CAMP Crash Avoidance Metrics Partnership

CES Consumer Electronics Show

DGPS Differential Global Positioning System

DSRC Dedicated Short Range Communication

ESC Electronic Stability Control

GDP Gross Domestic Product

GLONASS Globalnaya Navigatsionnaya Sputnikovaya Sistema

GPS Global Positioning System

HMI Human Machine Interface

IEEE Institute of Electrical and Electronics Engineers

LBS Location-Based Service


76/77

LIDAR Light Detection and Ranging

LTE Long-Term Evolution

MIT Masachussetts Institute of Technology

NHTSA National Highway Traffic Safety Administration

NRI Notice of Regulatory Intent

OEM Original Equipment Manufacturer

OS Operating System

ROI Return on Investment

RTK Real-Time Kinematics

SAE Society of Automotive EngineersUSDOT United States Department of Transportation

V2I Vehicle to Infrastructure

V2V Vehicle to Vehicle

V2X Vehicle to External environment

VII-C Vehicle Infrastructure Integration Coalition


----------------------- Page 36-----------------------

Contact Us

Gary SilbergJos PlessersPartner, KPMG LLPDirector, Strategic Services GroupNational Sector Leader AutomotiveKPMG LLPT: 312-665-1916T: 312-665-3418E: [email protected]: [email protected]

Richard WallaceChris BrowerDirector, Transportation Systems AnalysisManager, Strategic Services GroupCenter for Automotive ResearchKPMG LLPT: 734-929-0475T: 313-230-3096E: [email protected]: [email protected]


77/77

Gary MatuszakDeepak SubramanianGlobal Chair Technology,Senior Associate, Strategic Services GroupMedia & TelecommunicationsKPMG LLPKPMG LLPT: 312-665-1075T: 408-367-4757E: [email protected]: [email protected]

About KPMG About CAR

Having the right professional services firmone with the The Center for Automotive Research, a nonprofit organization,industry depth, knowledge, and insight to help clients address is focused on a wide variety of important trends and changes

their most pressing issues and achieve their goalsis critical. related to the automobile industry and society at thei

nternational, federal, state, and local levels. The Center forFor decades, KPMG's Global Automotive practice has been

Automotive Research is involved in the research of significantrecognized for its commitment to the industry. Through our

issues that relate to the future direction of the globalinternational network of member firms, we have the global

automotive industry. CAR's automotive industry research isreach and experience to serve clients anywhere in the world.

performed by distinct groups and programs.Our Automotive practice includes professionals with theknowledge, experience, and skills to help our clients address To fulfill its mission as an impartial voice of the industry, CARtheir challenges, sort through today's complex business maintains strong relationships with industry, governmentproblems, and achieve their goals. agencies, universities, research institutes, labor organizations,

media, and other major participants in the international

automotive community.

kpmg.com | cargroup.org

Self Driving kkk

Text of Self Driving kkk

Self-Driving Cars - Lu

Self-driving Cars for Sustainable Mobility · Self-Driving Cars for Sustainable • The worlds first large scale project for self-driving cars • Project starts 2014 • Self-driving

googles self driving car

A Driving Strategy Model of Self-Driving Cars · tion between self-driving cars, as well as the interaction between self-driving and non-self-driving vehicles, the real effects of

HACH ORBISPHERE 510 KK0/KKK AND 511 KK0/KKK MULTI …

Self driving cars.pptx

Self Driving Car -v2.0

Shellfish Area Classification Division of Marine Fisheries ... · kkkkkk kkkkkk kkkkkk kkkkk kkkkk kkkkk kkk kkk kkk kkk kkk kkk kkk kkkk kkkk kkkk kkk kkk kkk kkk kkk kkk kkk kkkk

Self driving vehicle

Google self driving car

Self Driving Technology

Catalog KKK

Components Self-Driving

The Self-Driving Car

A Self-Driving Tour

Bustos KKK

AffinityLive: Self-Driving Car? Why not a Self-Driving Business?

Deep Learning for Self Driving Cars - Meetupfiles.meetup.com/19871959/...deep-learning-for-self-driving-cars.pdf · Deep Learning for Self Driving Cars. ... 5 seconds is the average

Self Driving

Sharecropping & KKK

Self Driving Cars V11

Page 1 Fascinatia rozelor 1.51 (2) - xsl.pt · Page 2 Fascinatia rozelor 1.51 (3) (5) (6)!!!!! +!! +++ +++ +++ +++ KKK KKK KK!!!!! K!!!!! K!K KKK KKK KKK KKK KKK

COINTELPRO-KKK PART 1 (FBI FILES ON THE KKK)

transcript kkk

Self driving Cars

Self Driving Cars - WordPress.com

The Self-Driving Network - Juniper Networks · The Self-Driving Network implementation Processes that require self -driving Design Test Plan Build Operate Topology Technology selection

Google's’ self Driving Car

EGN 4905 - Autonomous Systems Self Driving Cars · PDF fileEGN 4905 - Autonomous Systems Self Driving Cars ... Demonstrate advanced capabilities of autonomous self-driving car!

ChM Mountain Lake · vvv vv. vvv vv, XXX XXv BBb bbB Bbb fBb Bff Bff BBB bbb Kbb KKK KKK KKK KKK

Documents

Self Driving kkk

Text of Self Driving kkk