The autonomous-driving industry is beginning to consolidate around a smaller number of companies as automakers form partnerships with each other and invest in startups. The economic impact of COVID-19 will accelerate that process, industry executives have said. Some startups, like Zoox, Ike, and Kodiak Robotics have already laid off workers.
A number of smaller companies working on self-driving technology are likely to go out of business in the next two years, said Sam Abuelsamid, a research analyst at Guidehouse Insights whose areas of focus include automated driving and mobility services. But there are bigger names, like Apple and Uber, that may also shut down their autonomous-driving programs, Abuelsamid said.
Apple and Uber did not respond to requests for comment.
Apple has reportedly been working on self-driving technology for years, but has not offered many details about its efforts. According to reports published by The New York Times in 2017 and 2018, Apple has been quietly developing autonomous-driving technology since 2014, but has narrowed the project's scope from building electric self-driving cars to creating the technology for an autonomous shuttle to be used by its employees. In 2019, Apple bought the autonomous-driving startup Drive.ai.
Guidehouse Insights placed Apple last on its 2019 ranking of companies developing autonomous-driving technology after evaluating 20 firms on criteria like strategy and execution. Apple did not appear on Guidehouse's 2020 list.
Apple's experience making sensors and computing systems for mobile phones suggests it has the potential to make that kind of hardware for self-driving cars, Abuelsamid said, but the company's automated-driving efforts do not appear to have a strong sense of direction.
"It's not clear exactly what they want to do," he said.
Uber has been more transparent about its autonomous-driving project, but the ride-hailing company's autonomous-vehicle division, Uber ATG, is best known for its involvement in a fatal 2018 crash, the first known death caused by a self-driving car. (The National Transportation Safety Board determined in 2019 that Uber, the car's safety driver, and the victim shared responsibility for the accident). The company halted on-road testing for nine months after the incident, and Uber ATG employees shared with Business Insider concerns about the unit's strategy and culture in 2018. Like Apple, Uber was not included in Guidehouse's 2020 ranking of companies developing self-driving technology.
Owning and operating self-driving cars would force Uber to change its business model from one that requires few physical assets (the company doesn't own the vehicles its drivers use) to one that would include the costs of vehicle production, maintenance, and insurance, Abuelsamid said.
"I've never thought that it made any sense for Uber and Lyft to develop their own automated driving systems," he said.
Even if Uber decided it only wanted to make self-driving software and sell it to other firms, the company has yet to demonstrate that its technology is better than competing systems, Abuelsamid said.
"It just doesn't make sense to keep pouring hundreds of millions or billions of dollars into this effort when you're not likely to ever see a return on it," he said.
Do you work in the autonomous-vehicle industry? Do you have an opinion on how your company or the industry as a whole will handle the fallout from the coronavirus? Email this reporter at mmatousek@jkmperu.com. You can also reach out on Signal at 646-768-4712 or email this reporter's encrypted address at mmatousek@protonmail.com.
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