Survey: Auto industry challenges for AV acceptance include exposing consumers to AV capabilities and competing with tech companies
According to the results of a new survey of more than 1,500 American drivers by AlixPartners, a global business-advisory firm, 29% of consumers say they would be willing to consider buying an autonomous vehicle (AV) and to pay an incremental $2,600 on average for the privilege, and 20% of those are the early-adopters who see themselves buying an AV within the first year it is offered for sale and are willing to pay an incremental $3,500 or more. The study was released at the Technology in Motion (TIM Detroit 2017) conference.
However, nearly half (49%) of consumers said they don’t currently feel confident in AVs’ abilities to navigate them safely and, perhaps because of that lack of confidence, 55% said they are unlikely to consider purchasing an AV.
On the safety front, there were two top concerns: 84% of respondents said they are concerned about vehicle-software malfunctions in AVs, and a close 80% said the same about potential hardware malfunctions. Meanwhile, cybersecurity concerns with AVs are also on consumers’ minds, according to the survey results. For instance, 77% said they would be concerned about their AV being hacked and taken over, and 75% said they are concerned about having their personal data stolen from an AV.
The report also found that consumer awareness of AVs as a concept now stands at a near-universal 97%, up from 90% in a similar AlixPartners survey in June 2016. Additionally, in this year’s survey, 18% say they’ve already experienced vehicles with at least some level of AV features, up dramatically from 3% in last year’s survey. Of this subset of potential early-adopters, 49% said they feel “confident” or “very confident” about the ability of AVs to safely navigate on roadways, versus 26% among those who have not experienced AV features.
The AlixPartners survey also reveals a consumer-preferences shift when it comes to product features in AVs versus today’s vehicles. Traditional product attributes, such as performance, design, and reliability, were 15%, 10%, and 4% less important to consumers in the survey when considering AVs versus today’s vehicles, to infotainment and connectivity, which were 4% more important in AVs. Furthermore, the survey reveals what appears to be a disconnect between where consumers most want to use AVs and the likely plans of automakers for AV roll-out cadence.
The survey results also reveal that automakers are behind tech companies when it comes to the trust of consumers for developing AVs. For instance, when it comes to the thought of protecting their data in AVs and protecting their AVs from being hacked, consumers in the survey said they have much greater trust in technology companies (Alphabet Inc.’s Waymo as an example) than they do in traditional auto companies. When asked who they would trust most to maintain their data privacy in an AV, 50% said tech companies, compared to just 14% who said auto companies; and when asked who they trusted most to protect their vehicle from hacking, 62% said tech companies, versus only 8% who said auto companies. Ride-hailing companies (Uber Technologies Inc. and Lyft Inc. as examples) placed a far-distant third in trust for both questions, at just 1% for each.
Moreover, tech companies were also ahead of traditional auto companies in the survey when it comes to developing the software critical to AVs. While 79% said they trust traditional automakers most to design and develop AV vehicle hardware, only 10% said they trust automakers most with the software side of AVs—the side of the business where many experts believe the lion’s share of profits will lie. That compares with 78% of those polled who said they trust tech companies most to design and develop AV software. Meanwhile, 10% said they trust tech companies most for designing and building vehicles. Ride-hailing companies were not trusted for either the “brain” or the “brawn” of AVs, coming in at 1% for both categories in the survey.
Interestingly, however, consumers in the survey did not rate tech companies, at least not working alone, as their most-preferred development model for bringing AVs to market; rather, most pointed to partnerships between auto and tech companies as their preference. Specifically, on a scale of 1 to 5, auto-tech partnerships as the preferred model averaged 3.4; while traditional automakers, working alone, averaged 2.6; and tech companies, perhaps surprisingly given some of the other results in the survey, averaged just 2.1.
Meanwhile, among those surveyed who said they’d consider purchasing an AV (29%), they also indicated they’re willing to pay an incremental $2,629 on average. And, of those who said they’d be early-adopters to AVs—buying one in the first year of introduction—43% said they’d be willing to pay an incremental $3,500 or more.
Those numbers are below or about even with the 2017 AlixPartners’ study estimate of AV-component costs for 2025—when many experts believe economies of scale will start kicking in and the technology to have matured—of about $3,300.
Mark Wakefield, global co-head of the automotive and industrial practice at AlixPartners, said, “When it comes to autonomous vehicles, traditional auto companies and suppliers have a big, two-front battle ahead of them: educating the consumer about AVs and figuring out how to compete in the software end with highly advantaged tech companies—or partner with them when that makes more sense. Either way, traditional auto will have to undertake massive operational and organizational changes to afford the autonomous-vehicle investments, be successful with partnerships, and not get left out of the profitable parts of the new automotive ecosystem.”