Just 20 years after the publication of those derisive comments, some of the most iconic vehicles of all time, from the Ford
Thunderbird to the big-finned Chevy Bel Air, were rolling across
fresh asphalt in every corner of the United States. And as a result of
this technological revolution, we saw the entire fabric of American
life adjust—from roadside billboards and drive-in movies to the
birth of suburban life and the daily commute.
And now, as we enter 2018, the notion of self-driving cars
has moved out of science fiction and into automobiles all across
Of course, for all the change and progress offered by the
advent of automobile ownership, there were plenty of optimistic
and half-baked predictions about how car culture would continue to evolve. (A few of the more outlandish ideas include
the Ford Nucleon concept that would theoretically be powered
by nuclear energy and the barely seaworthy Amphicar, among
This is worth remembering as we enter 2018, with the American
automobile industry appearing poised to take a giant leap forward.
While many early adopters and futurists believe autonomous
vehicles will become commonplace very soon, human-driven
vehicles are very much the norm in the here and now.
So how fast will things actually change on our roadways?
And more important, are American motorists and businesses
Vehicle Technology Is Already Having a Big Impact
Perform a quick internet search for “self-driving car video” and
you can see for yourself that autonomous vehicles are a reality
right now, and not just a pipe dream.
But admittedly, the scale is incredibly small; California, the
nationwide leader in this emerging technology thanks to the major
tech companies headquartered in Silicon Valley, still boasts fewer
than 300 registered vehicles in the entire state.[ 3]
It’s helpful, then, to think about the impact of autonomous
cars and related technology beyond simply the number of vehicles
on the road.
Technology Is Preventing Motor Vehicle Deaths
Big safety improvements in the 1980s started the long-term decline
in car-related deaths in America. But technological innovations
over the past decade or so have built on this trend in a big way,
even if those systems haven’t been able to work together in fully
autonomous vehicles. (See sidebar, page 21, for a discussion of
degrees of automation.)
Thanks in part to high-tech collision avoidance, backup
cameras, and lane detection, traffic fatalities in 2016 tallied just
37,461[ 4]—down 16 percent from 44,599[ 5] in 1990 despite a
population that increased by almost 80 million Americans across
the same period.[ 6]
Considering that the comprehensive costs of fatal motor vehi-
cle crashes in the United States tallied over $830 billion last year
alone,[ 7] a continued reduction in lost lives and the very real loss
of capital is a significant trend.
Ride Sharing Is Ascendant
Eager investors and smartphone-reliant millennials have already
seen the real-world impact of ride-sharing services like Lyft and
Uber. Investment bank Goldman Sachs recently estimated that
some 15 million ride-hailing trips occured each day around the
world in 2017—and in just 13 short years, that will increase more
than sixfold to 97 million by 2030[ 8] to become a roughly $285
billion global market.
And because the natural next step for ride-sharing is to hitch
a ride with an autonomous vehicle instead of a human driver,
you can expect autonomous cars to play a big role in this shift.
Self-Driving Cars Are High-Tech Incubators
Safety improvements and expanded ride-sharing behavior are
obvious developments brought about by the advent of autonomous
cars, but other improvements are less intuitive.
For instance, the computer vision technologies deployed in
autonomous cars continue to evolve; these systems have applications that range from piloting airborne drones to running
Similarly, the problem-solving at the core of a self-driving car
is driving artificial intelligence advances that can be used in a host
of industries outside transportation. In fact, autonomous mining
and farming equipment are both already in limited use, showing
how the technology scales beyond the highway.
Because of these trends, among others, the insurance industry
is already preparing for the self-driving car revolution even if there
are only a few hundred cars on the roadway at present.
For instance, as early as its 2015 annual report, Allstate warned
investors that it could see significant losses if the publicly traded
insurance giant didn’t adequately prepare for this sea change.
Specifically, Allstate called out “potential technological changes,
such as driverless cars or technologies that facilitate ride or home
sharing, [that] could disrupt the demand for our products from
current customers, create coverage issues or impact the frequency or
severity of losses, and we may not be able to respond effectively.”[ 9]
In other words, while the widespread adoption of this new
technology may not be around the corner, we are already seeing
the impact—and that means the time for preparation is now.
Most Big Questions About Self-Driving Cars Are
Automakers and policymakers will assuredly experience issues
that were unanticipated or previously overlooked, of course. But
all serious automotive analysts agree that self-driving cars are a
forgone conclusion, and the question is not if the technology will
succeed, but when.
Chris Nyce, a partner at consulting giant KPMG, has researched
the prospect of autonomous vehicles extensively. He recently
published a white paper on the topic, “The Chaotic Middle: The
autonomous vehicle and disruption in automobile insurance.”
In his mind, perhaps the only open question is how insurance
will evolve—the rest is just a matter of time.
“There has been broad support among regulators for this