Self-Driving Cars Gain Momentum in US

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In mid-2024, the US ride-hailing market has seen renewed progress in autonomous vehicle technology after a slowdown in 2022 and 2023.

The summer of 2024 saw steady developments related to autonomous vehicles (AV) in the United States. Self-driving startup Waymo continues to be the leader, while disruptions at GM's Cruise AV division are proving to be a setback and, arguably, a situation where the lessons learned may leave the division in a better position.

Though progress has not come at the pace predicted in the 2017-18 period, potential for the technology to truly transform the way people and goods move in society remains compelling.

Waymo: Still the front-runner

In the summer of 2024, Waymo's parent Alphabet said it would invest up to US $5 billion into the startup, which also unveiled the sixth generation of its Waymo Driver autonomous driving system. Waymo operates a fleet of nearly 800 self-driving vehicles in California and more in Phoenix in the US, and it is the only one collecting fares today, though GM's Cruise fleet is also expected to do so again sooner rather than later.

Waymo's sixth-generation system features a more cost-effective sensor setup with enhanced resolution, range, and computing power. An optimized sensor suite provides overlapping fields of view all around the vehicle, up to 500 meters away, day and night, and in a range of weather conditions.

By optimizing sensor technology and placement, Waymo has reduced the number of sensors while ensuring safety redundancies. The modular sixth-generation system, according to Waymo, allows for swapping out sensing components to adapt to specific environmental conditions—for example, adding enhanced sensor cleaning for colder climates. This generation is designed to operate reliably in a wider range of inclement weather conditions, including heat, fog, rain, and hail.

Earlier in 2024, Waymo started testing robotaxi services on highways in San Francisco with the fifth-generation system after several months of driving and collecting fares on city streets. Service expansions in Phoenix, Los Angeles and San Francisco have already begun.

Though almost a year later than expected, Waymo and electric vehicle company Zeekr also partnered to test a robotaxi on public roads in San Francisco in July 2024. By the end of August 2024, Waymo's US paid weekly robotaxi rides reached 100,000, versus 50,000 per week in May 2024.

However, US regulators at the National Highway Traffic Safety Administration (NHTSA) are investigating Waymo incidents related to potential for crash, property damage and incidents of collisions with "clearly visible" objects; at the time of this writing, the investigation remains in a preliminary stage.

It's not certain if the sixth-generation system addresses these concerns, or what the agency's conclusion will be. In 2023, Waymo scaled back its work on deployment of its commercial delivery arm Via to focus on the Waymo One ride-hailing program.

Cruise Automation

GM's Cruise Automation saw a significant setback in October 2023, when it was involved as a secondary vehicle in a pedestrian accident. The incident halted Cruise operations for several months, put Cruise safety measures and development under scrutiny, an independent investigation was undertaken, and most of Cruise's leadership was changed.

GM used the situation to help Cruise Automation restructure and refocus, though it did not waver on its dedication and commitment to Cruise. Like Waymo parent Alphabet, GM increased its investment into Cruise in mid-2024. GM CEO Mary Barra said that the developments caused Cruise to rethink its safety target: Instead of aiming to be better than the average driver, the target is to be "better than a role-model driver."

However, GM also canceled the Origin AV shuttle project, sensing more opportunity by focusing on the first-generation Bolt EVs currently in the test fleet and an autonomous vehicle from the next-generation Ultium-based Bolt EUV.

Cruise has already resumed operations in the US, starting with a limited fleet of human-driven vehicles in Phoenix in April. Since then, the company has expanded its operations to include Dallas and Houston. It has not yet regained its previous permissions in California.

In August, GM announced plans to offer Cruise robotaxis on Uber's platform. GM also revived its conversation around offering a level-4 system on personal transportation, both in the context of Cruise developments and on a Cadillac concept car.

The Cadillac products may be a natural place for early deployment of personal-use autonomous vehicles. GM is planning an Investor Day in October 2024 and has promised the event will provide more insight into the company's plans for Cruise and AV development.

Updates on Tesla

Tesla continues to call its automated driving assist system, which operates at a Level 2-plus point so far, by the Full Self-Driving name, though the current version is now called "supervised full self-driving." The company continues to say it is on the cusp of offering truly self-driving technology and enabling its fleet to be robotaxis, although it has now delayed a reveal of its robotaxi, initially expected in August, to October 10, 2024.

CEO Elon Musk has suggested that Tesla is considering an Air BnB-style or Uber-style deployment, where owners make their vehicles available to be rented through a Tesla site but own and maintain the vehicles. The October 2024 reveal is expected to answer a number of questions about Tesla's readiness to deploy true self-driving vehicle technology, but developing the vehicle program would be a multi-year effort and is not expected before the 2026-27 time frame.

Where are we now?

A vision for broader deployment by early this decade was not met. The actions around the COVID-19 pandemic slowed development and created economic pressure for automakers. Decisions at some OEMs to prioritize battery-electric vehicle development over autonomous-vehicle technology development also seemed to stall already dampened investor interest in tech startups, thus slowing capital. From 2021 through 2023, advancement on autonomous vehicle technology continued but the scope of the challenge remains massive, so overall progress towards deployment appears to have slowed.

In 2024, though the AV industry overall still faces a lack of sufficient capital to support technology development, investment announcements have come from parent companies of AV startups. Progress has continued in mainland China as well due to the development of regulations and standards, the establishment of pilot zones, and the issuance of AV testing licenses.

S&P Global Mobility's September 2024 Autonomy Forecasts describes sales of autonomous vehicles growing slowly in the US. In 2034, sales of autonomous light vehicles in the US is forecasted to reach about 230,000 autonomous mobility-as-a-service units, suggesting market share of less than 1.5% per year a decade from now. In mainland China, development is progressing more quickly. In that market, we forecast potentially 1.5 million autonomous vehicles sold in the country in 2034, or about 5% of light-vehicle sales. Europe is expected to advance more slowly than the US, however, with sales beginning later than either the US or mainland China and rising to only 37,000 units in 2034.

Will autonomous vehicle technology prove to be as elusive as a strong hydrogen economy, something for which scale deployment seems perpetually 15 to 20 years in the future? Investment and expansion in 2024 are encouraging in the US market, but challenges remain.

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This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.