There are long term implications for the automotive industry and suppliers with the advent of driverless cars, says a new report by Moody’s Investors Service.
The report entitled “Autonomous Vehicles Will Drive Change from Auto Manufacturing to Insurance”, looks at the potential impacts of autonomous driving in a number of areas.
While the widespread adoption of fully autonomous vehicles in Europe is still decades away, some features are already being incorporated into newer vehicle models.
Driverless car technology has the potential to make road travel safer and less costly for households and companies, and to significantly affect vehicle production, spending and usage.
While there are many uncertainties about the future of autonomous road travel, there are potential credit implications for a wide array of industries, it says.
Car makers could benefit from a price premium for these vehicles, although the replacement rate could decline because optimized driving by a computer would reduce wear and tear.
Slow initial demand due to high production costs should pick up dramatically once costs decline and vehicles are available at attractive price points. Over the long run, fewer cars could be sold due to lower wear and tear of autonomous cars.
Technology companies would benefit to the extent that the technical capabilities of the vehicles become the true value for consumers. Software and semiconductor firms are best placed to benefit from demand for driverless cars as software and electronic hardware will become even a more integral part of automobiles.
Data and Internet providers will also benefit from requirement of continuous data feeds on driving conditions.
In another report, the latest autonomous technology might add £10,000 to the price of a car, say analysts, and it could be difficult to sell this to customers.