Current generation AV tech could achieve more, says Oxbotica

Focusing on speculative single occupancy transport solutions could be preventing the AV sector from realising its full potential. By Will Girling

In a January 2023 report, McKinsey & Co forecasts that the autonomous vehicle (AV) market could create up to US$400bn in revenue by 2035. Despite being an uneven year for overall development—particularly following Argo AI’s closure in Q4—the events of 2022 haven’t signalled a large-scale investor retreat from the sector.

However, McKinsey’s research focused entirely on the B2C market trends: robotaxis and private passenger vehicle applications. In its base case scenario, the consultancy suggests 12% of vehicles produced will feature SAE Level 3 capabilities or higher by 2030, rising to 37% in 2035. Like the technology itself, investors in the B2C market may have to reconcile themselves to incremental gains. Argo AI’s disastrous US$827m loss in Q3 2022—prompting Ford to pull the plug—is indicative of the consequences of too little value drawn from too much investment (US$3.6bn). In order to maintain market interest in the medium term, the scope of AVs applicability will need to be broadened.

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