Navigant Research Blog

Autonomous Vehicle Pros and Cons for Government Budgets

— August 10, 2015

Autonomous vehicles continue to gather media headlines as the industry promises a highly desirable future consisting of drastically reduced vehicle accident rates, congestion, and road emissions. While these impacts and the potential effects on the insurance industry are often discussed at length, less attention has been given to how autonomous vehicles may affect government budgets—particularly law enforcement.

Speeding Tickets

As a prime example, autonomous vehicles simply do not drive faster than posted speed limits. Google’s driverless vehicles have logged more 1 million miles autonomously without receiving a single citation. According to the National Highway Traffic Safety Administration (NHTSA), the average cost of a speeding ticket in the United States is $152, and about 41 million people receive a citation each year. This amounts to a staggering $6.23 billion in potentially lost state and local government revenue each year due to autonomous vehicles. Additionally, autonomous vehicles do not run red lights or drive under the influence of any substances, eliminating two other significant sources of revenue for government services.

What About Parking?

And then there’s parking; New York City alone generated $534 million in parking ticket revenue in 2013. How autonomous vehicles may affect the business of parking revenue is much less clear than other sources of traffic violation revenue. Navigant Research expects parking to be an area remaining far more in consumers’ hands compared to highway and even city driving, at least in the near term.  Nevertheless, the on-demand nature of autonomous vehicle fleets is expected to reduce personal vehicle ownership over time, and thus the need for parking is expected to decrease, as well. If large numbers of people are using smartphone apps such as Uber to summon autonomous vehicles, parking demand and usage should decrease, which in turn is expected to lead to a significant loss in parking ticket revenue. The extent to which this may happen is unclear thus far.

Revenue Reduction Offset by Reduced Costs?

Conversely, autonomous vehicles may also reduce costs for government, somewhat negating the loss in revenue streams. The NHTSA has stated that 7% of vehicle crashes are paid for with public revenue. This annual taxpayer bill of roughly $10 billion is used for emergency services, property damage, court costs, and other expenses. Autonomous vehicles could drastically reduce or nearly eliminate the 5.6 million accidents occurring annually in the United States, saving local and state governments enormously on expenditures. Reduced demand for parking in densely populated urban areas may also free up land that could be utilized for either residential or commercial development, which could provide a new source of jobs, housing, and tax revenue.

Whether autonomous vehicles will ultimately end up saving governments money or reducing their budgets is unclear. What is clear, however, is that a future where citizens spend little or no money on traffic violations and everyone saves enormously on vehicle crashes and fatalities is a future worth pursuing.


Autonomous Trucks Make Progress

— August 3, 2015

Autonomous vehicle technology continues to advance steadily, with new testing facilities opening to great fanfare at the University of Michigan being a recent highlight. Around the world, plans are being put into action to test self-driving cars in many different localities, and work continues within all the major automotive manufacturers and large suppliers. The first freeway cruising and traffic jam applications are going into production in a few 2016 models, and many more are promised by 2017.

The focus from large OEMs is still on incremental improvements to existing advanced driver assistance systems, with more capable software and sensor fusion. The marketing appeal to car buyers is based on convenience and comfort with the added benefit of greater safety. Prevailing wisdom says that the personal vehicle market will continue as it has done for the past century, but there is the potential for significant change if the technology delivers and legislation is updated to allow it. This topic is discussed in the latest version of the Navigant Research Autonomous Vehicles report.

Under the Radar

What is flying a little under the radar is the work going on to launch autonomous commercial vehicles. Daimler caused a stir in May when it gave a demonstration of its Freightliner Inspiration Truck at the Hoover Dam.  In July, the company announced that it expected to be able to begin testing on public roads in Germany before the end of 2015.

Another option that is an incremental step toward autonomous driving is offered by U.S. company Peloton, which offers a platooning feature that can be added to existing vehicles. Peloton’s technology connects two trucks wirelessly and allows the following truck to close the gap safely, with speed and braking controlled by the lead vehicle while the driver remains responsible for steering. The company claims that fuel savings on a long drive are approximately 4.5% for the front vehicle and 10% for the follower.

Deciding Whether to Invest

Fuel savings are the first step toward justifying new technology for fleet managers who must decide whether to invest. The ultimate potential of autonomous vehicles is to reduce or eliminate the cost of the driver, which produces the inevitable result of lost jobs, a topic beginning to stimulate some debate in the media.

New technology almost always brings societal change, but the rate of change has increased in the computer age, and a serious commitment to retraining programs needs to be made by governments as they make changes to legislation to support the emergence of autonomous driving capability and other forms of robotics. It isn’t all bad news though. The new truck pilot jobs will need new skills on top of the conventional driving ones and should command higher pay.


Cybersecurity for Self-Driving Cars Needs a Confidence Boost

— July 29, 2015

Highly detailed and accurate mapping data will be critical to the technical success of future autonomous vehicles. However, in order for consumers and regulators to accept vehicles that pilot themselves to a desired destination, they will need to have a great deal of trust in the technology. That trust is currently in serious danger of being eroded by an ongoing series of computer network attacks, including one demonstrated recently on The need to bolster automotive cybersecurity is one of the factors driving Mercedes-Benz, Audi, and BMW to jointly acquire Nokia’s Here mapping division.

Nokia was an early leader in the field of bringing high quality maps to mobile devices with its 2007 acquisition of Navteq, but the world of mobile cartography has shifted dramatically since then. With mapping apps from Google and Apple joining incumbents such as TomTom and Garmin, along with the rapid development of autonomous driving capabilities, the expectations for map data has increased exponentially. Cartographic data needs to be kept continuously updated through fleets of camera and sensor-equipped vehicles, in addition to crowd sourcing for real-time information. Unlike traditional automotive navigation systems that might get updated annually at best, this fresh data will need to be pushed to automated vehicles as soon as it’s ready.

The big three German premium brands are all expected to be on the leading edge of introducing level 2 automation capabilities and are likely to ramp up automation as soon as  technology and the market allows. Navigant Research’s Autonomous Vehicles report projects that nearly 50 million vehicles with some form of autonomous capability will be sold globally by 2030. One of the key drivers for the move to automation is the desire to reduce accidents to near zero by taking humans out of the driving control loop.

Gaining Trust

Before that can happen, everyone will need a much higher degree of confidence in the security the software and electronic systems, something that is getting more difficult by the day. For several years now, computer security researchers have been demonstrating increasingly sophisticated cyber attacks against vehicles, with the most recent coming from Charlie Miller and Chris Valasek. Miller and Valasek were able to remotely take control of a 2014 Jeep Cherokee through its telematics system, manipulate the audio system, wipers, steering, and even shut down the engine as it was driven by Wired reporter Andy Greenberg. These attacks are not trivial and are not yet widespread, but as we’ve seen from recent attacks against the U.S. Office of Personnel Management and retailers such as Target and Home Depot, the more attackers learn about the systems, the more attack vectors they find.

Automakers are hiring some of these same security researchers and creating teams solely focused on securing their in-vehicle networks. When automakers outsource control systems or data such as maps to suppliers, they often get only a black box that they can hook into without access to source code. Recognizing that they will be increasingly liable for the performance of advanced systems, they are now bringing some of the work back in-house where they can control it. Daimler AG CEO Dieter Zetsche recently acknowledged that security concerns were one of the reasons his company was partnering with its chief rivals to purchase Here maps. Similar concerns have prevented numerous automakers that have been approached by Google from adopting its autonomous driving software and developing their own code instead. Unless Google is willing to give up control of its software to automakers, it may only get adopted by lower tier companies without the resources to develop their own autonomous systems.


University of Michigan Opens Autonomous and Connected Vehicle Proving Ground

— July 20, 2015

For decades, the University of Michigan in Ann Arbor has been one of the top training grounds for the engineers that power the American automotive industry. However, with the focus on Google and its self-driving driving cars in recent years, the center of gravity seems to have shifted westward to Palo Alto, California, and Stanford University. With the grand opening of the Mobility Transformation Center (MTC) in Ann Arbor, however, Michigan hopes to regain its place in the pecking order while driving automated and connected vehicle technology forward.

Navigant Research’s Autonomous Vehicles report projects that nearly 50 million vehicles with some form of autonomous capability will be sold globally by 2030. Those vehicles will need to function reliably in a broad range of environments and coexist with the existing human-driven fleet as well as technologies from many different companies.

The Solution

The MTC, also known as Mcity, is a 32-acre dedicated proving ground built on the university’s North Campus, which was formerly the site of pharmaceutical giant Pfizer’s Ann Arbor R&D center. Mcity will be operated by the University of Michigan’s Transportation Research Institute (UMTRI) in partnership with more than a dozen automakers, suppliers, insurers, and the U.S. and Michigan departments of transportation. The facility includes road surfaces paved with a variety of materials along with unpaved roads and features such as signs, fire hydrants, crosswalks, roundabouts, overpasses, and tunnels. Movable building facades will enable the testing of a variety of real-world scenarios.

Partner companies and students of the university will all have access to the facilities to develop and validate new transportation technologies. Among the participating companies are Toyota, Honda, General Motors, Ford, Robert Bosch LLC, Delphi, Qualcomm, and State Farm Insurance. Each of the manufacturers have R&D centers and test facilities of their own in or near southeast Michigan, but those facilities are closed to outsiders. At Mcity, the companies will have a common ground where they can test individually and collaboratively to ensure that their respective systems can coexist.

And, unlike in California, where weather is rarely an issue that test drivers have to contend with, Mcity will also provide a platform for testing under all of the environmental conditions faced by drivers, including winter snowfall and road salt. Most current automated driving systems do not function as well or, in many cases, at all if the weather is less than ideal. This is a problem that will need to be addressed before systems are deployed to customers.

Preparing for V2X

Navigant Research’s Connected Vehicles report estimates that more than 80% of new vehicles sold in North America and Europe will be equipped with vehicle-to-external (V2X) communications capability by 2025. While initial deployments are expected to focus mainly on vehicle-to-vehicle transmission of basic safety messages, the potential to expand the data transfer to pedestrians, cyclists, and infrastructure could have a significant impact on reducing congestion and accidents. Among the features of Mcity are stationary and motorized pedestrians and cyclists that can be equipped with V2X transponders and that can also be used for testing the sensing capabilities of automated vehicles.

The collaborative efforts at Mcity will also include the development of performance and reliability standards for communications and automation systems. While much of this work will likely become the basis of new SAE industry standards, it could also feed into future federal motor vehicle safety standards, which do not currently address autonomous driving. Work at this new collaborative testing facility is scheduled to begin this summer.


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