Even though the test coupes will be limited to a top speed of 25 miles per hour, Google execs are having a hard time containing enthusiasm.
“Ever since we started the Google self-driving car project, we’ve been working toward the goal of vehicles that can shoulder the entire burden of driving,” the company says, in an accompanying press release. “They will take you where you want to go at the push of a button.”
The idea of self-driving vehicles is gaining popularity among consumers, who see a void that needs to be filled. And that means there will be a growing number of possibilities for investment.
A Wild Ride for Automation
In January, industry experts with the RAND Corporation agreed that the benefits of automated car travel – such as the potential for reduced pollution and crashes, and increased energy efficiency stemming from smoother traffic flow – sufficiently outweigh the risks.
According to the U.S. Census Bureau, more than 448,000 crashes in 2009 were a direct result of distracted driving – one of the unfortunate human factors Google hopes to eliminate with its tiny fleet of proto-chauffeurs.
And it looks like it’s working out well – for proof, the RAND Corporation cited that no accidents occurred among Google’s previous automatons, even after logging more than 500,000 miles on public roads.
As a result, insurance rates could take a nosedive, with alcohol- and fatigue-related crashes becoming a thing of the past (former drivers could even take naps behind the nonwheel); a fact Google project leader Chris Urmson noted at a conference in late April.
“People will be able to get dropped off at the restaurant, enjoy their time, have a drink or two, and get a ride home safely,” he said.
Who’s Serious About Investing
A handful of automakers are recognizing the possibility of automated driving, and are making appropriate investments to capture the lion’s share of the market (should self-driving cars come in vogue). As early as January of last year, Audi (Xetra: NSU) debuted its own autonomous car program at the 2013 Consumer Electronics Show.
Using a smartphone app, developers called an Audi A7 sedan to the front of the Mandarin Oriental Hotel in Las Vegas. After it arrived, they sent it to wait patiently in a nearby parking space.
Ford Motor Company(NYSE:F) has also entered the game by mounting a computer guidance system on a Ford Fusion hybrid sedan for testing purposes, with the goal of outfitting consumer machines with them in 2025. Earlier this year, Carlos Ghosn, the CEO of Nissan Motor Co., Ltd. (ADR)(OTCMKTS:NSANY) and RENAULT(BIT:RNO), spoke of plans to launch driverless car systems as early as 2020.
Why Investing Is a Good Idea
Though revolutionary, the rise of automated vehicles makes sense to Morgan Stanley(NYSE:MS).
“This is not a toy. The social and economic implications are enormous. Beyond the practical benefits, we estimate autonomous cars can contribute $1.3 trillion in annual savings to the U.S. economy alone, with global savings estimated at over $5.6 trillion,” Morgan Stanley said.
Only if you’re a fan of making money, that is. According to USA Today, the automated car industry is expected to explode from about 230,000 vehicles in 2025 to more than 11 million by 2035.
And that means a smooth investment road ahead, with no potholes in sight.