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How the Self-Driving Car Market Could Mean Another Renaissance for American Car Manufacturers

December 26, 2016 No Comments

Featured article by Jeremy Sutter, Independent Technology Author

Every year, car manufacturers release models that provide more automation. While the first truly self-driving car is still some time away, manufacturers are working quickly to solve the last few barriers to true automotive automation. The impact of self-driving cars is inherently difficult to predict accurately, but there’s a good chance that it could spawn another renaissance for American car manufacturers. Here are a few reasons why.

The World’s Leader in Tech

Germany, Israel, Japan and other countries have strong technology development, but none can match the sheer size and power of Silicon Valley and other American technological hot spots. America has long been and remains the world’s leader in technology, and domestic car manufacturers stand to benefit from their proximity to these companies. While manufacturers are working to develop their own technology, partnerships with tech companies are likely to play a role for some of these systems. In fact, Tesla, a company largely built on leverage technology, has made tremendous strides for a new manufacturer, and their success demonstrates a potential path for other companies to follow. Google has invested heavily in self-driving technology, and American companies such as Uber are already looking to use vehicles that work without a driver.

A Unified Nation

Although driving laws vary a bit by state, the United States represents a large region that operates with the same road signage and with roads designed to meet certain standards. While classes in defensive driving El Paso TX are likely to remain useful for the foreseeable future, American car manufacturers, who make most of their sales domestically, can take advantage of this standardization to target a large market. This allows domestic manufacturers to invest more heavily in self-driving technology, and this positions American manufacturers to become leaders. Foreign companies can also target the United States, but many will be forced to focus on self-driving technology within their own countries before targeting American drivers.

More Demand

Drivers in the United States often travel much further by car than their counterparts in European nations, Japan and Korea. Furthermore, more of this driving is done on highways, which are believed to be the first targets for self-driving vehicles. Americans are less likely to use public transportation than people in other nations, and they’re more likely to live in distant suburbs. It’s difficult to accurately gauge future demand, but most experts believe demand will be especially high in the United States due to the relative extra convenience that self-driving cars will provide. The United States is also a wealthy country, so drivers are more likely to be able to afford the cost of new self-driving vehicles.

Unified Legislation

Currently, laws regarding self-driving cars are issued within states, but the burgeoning field means Congress and various regulatory agencies will develop rules regarding liability for manufacturers and other legal and safety issues. Although the European Union can develop similar cars for its member nations, issues of sovereignty will make the process far more laborious. Again, foreign manufacturers can still attempt to compete in the United States, but these investments likely mean reducing their focus on their domestic markets, which may prove to be prohibitively expensive.

Modern Roads

The relative youth of America means that many cities grew largely in the age of automobiles, and this means that many downtown and other central locations are more car-friendly than their counterparts in other regions. As a result, it will be easier for manufacturers to develop vehicles that work in populated regions of America than in other countries. Cramped and windy roads throughout London, for example, are likely to pose challenges for manufacturers, especially foreign manufacturers that need to focus on their domestic markets. As American vehicles become better at non-highway driving, demand will likely increase.

Competition Breed Innovation

Many foreign nations have only one or two car manufacturers; the United States has far more. This means that competition will be especially fierce among domestic manufacturers, and competition typically leads to fast development. For foreign manufacturers, who can’t afford to invest as heavily in the United States, keeping up with American manufacturers may simply be impossible. These early gains in the United States may even allow American car company to outsell their European and Asian counterparts in foreign markets.

 

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