Designing self-driving cars is like the new space race. Finding the next big startup in autonomous and connected cars is the goal of many established companies and investors. It’s no surprise that companies like Apple, Google, and Uber want to dominate the space. It’s also evident that traditional car manufacturers fear outsiders such as IT companies that were born with technology as their backbone. While new players want to disrupt the market, they often underestimate the complexity and risk of playing in the space. One small misstep could end any progress. Take General Motors, for example. In 2014, the company reported a loss of $4.1 billion due to a faulty ignition switch that cost less than $1.
While there are already a few key players in the driverless and connected car market, as well as the mobility services space, it’s clear that we’re still in the beginning stages of this trend and that there’s plenty of room for startups and traditional car makers to get involved. For example, Toyota announced a five-year, $1 billion research and development effort to create technologies that make driving safer.
In fact, car makers have a strong appetite for new technology and products, so startups that are bursting with innovation make good acquisition targets. Daimler was the first major car company to get into the business of providing transportation apps and other services by acquiring RideScout, a ridesharing company, and Intelligent Apps, the developer of a taxi-book mobile app. Last year, General Motors bought Cruise Automation, a developer of autonomous vehicle technology, for more than $1 billion.
Companies are also hungry for talent, so they continue to scout out universities. In the 2007 DARPA Urban Challenge, an event in which teams developed autonomous vehicles that drove a total distance of 60 miles in under six hours, all the teams that successfully completed the challenge came from universities. To that end, Uber nabbed 40 autonomous vehicle researchers and scientists from Carnegie Mellon’s National Robotics Engineering Center (NREC).
In a new guide, we explore the industry’s interest in and movement toward autonomous and connected cars. You can download it here.
