COVID-19 Pandemic May Delay Arrival Of Autonomous Vehicles, But Future Remains Bright For AV Industry

Below is our recent interview with Mike Szudarek, who leads the Automotive Public Relations practice at Marx Layne & Company.

Q: How has the COVID-19 pandemic affected the future of Autonomous Vehicles?

A: One key question as the world works to emerge from COVID-19 is: Will efforts to advance Autonomous Vehicles be derailed by COVID-19?

Indications are that even in a best-case scenario, it will lead to delays in advancing the technology. Multiple companies working in the AV space announced thousands of layoffs during the pandemic, brought on by economic pressure from lockdowns around the world. Uber wound down its Incubator and AI labs, and GM’s Cruise spinoff laid off about 8 percent of its workforce in May. Even Waymo announced in March that it was suspending driverless vehicle testing.

Prior to COVID-19, there was a realization emerging that promises about large numbers of self-driving vehicles reaching the roadways in 2021 or 2022 may be overly optimistic. With the new delays brought on by the pandemic, projections will likely be pushed even farther, increasing pressure on AV companies to find new ways to innovate and speed up the timelines.

Q: How will funding be impacted?

A: Maintaining the pace for AV development will depend heavily on funding and levels of investment. With reduced bottom lines, previously aggressive projects may become longer-term goals. And there’s no guarantee that funding will be increased at a later date. A pullback on funding for AVs is not ideal for companies that have spent billions to this point and are getting closer to their goals, but they may not have any choice in the matter.

Also, to limit future financial impact, preparation must also be done by those in the AV industry to better protect the ability to continue making progress even if second and third waves of COVID-19 happen.

Q: What are the biggest challenges facing the AV industry?

A: Even as technology continues to improve, the unpredictable nature of the world’s roadways presents unique situations that must be addressed, so that the safety case can be made for AVs. Meeting all of those challenges can be quite difficult, even for the industry leaders.

During the pandemic, many of these companies are relying on simulation instead of real-world testing, which will impact the pace of advancement. Simulated environments don’t always adequately represent physical reality or realistic car behaviors; and replicating the data from real-world test drives through simulation is difficult, expensive, and near impossible.

The quicker everyone gets back to real-world testing at a pre-pandemic rate, the better. Simulation has its place in the process of developing self-driving cars, but it’s not the be-all-end-all to achieving major AV breakthroughs.

Commercialization of driverless car technology, in the end, may be delayed by two to three years due in large part to pandemic-related delays. Ford has already announced that it will delay an AV service until 2022, and others will likely follow with similar announcements.

Q: What are the bright spots for Autonomous Vehicles during the pandemic?

A: In China, Autonomous Vehicles are being used in cities and hospitals across the country to combat COVID-19 and advance smart cities. The pandemic presented new opportunities due to heavy lockdown limitations. Restrictions on retail businesses and dining have boosted the public’s use of autonomous driving technologies and robot services to limit spread of the virus.

Baidu has released driverless vehicles to support important work such as delivering food and supplies to hospitals to take care of patients and feed front-line workers. Apollo and Neolix also unveiled unmanned vehicles to disinfect roads on an Artificial Intelligence Island in Shanghai.

China’s ability to continue advancing AV development as a solution to problems caused by the pandemic is a bright light during a difficult time for the industry, and a sign that there is much to be hopeful about.

Q: How can the tech sector lead the way to keep up the momentum of Autonomous Vehicles?

A: Despite potential delays, the appetite for AVs is still out there and the industry is in a strong position long-term.

Input from innovators and tech sector leaders will be vital for the success of AVs after the COVID-19 threat has passed. AV companies will also need a strong communications plan and public relations strategy to stand out in a crowded field, with a large number of startups competing for a small piece of corporate real estate.

We do not know how long COVID-19 will be hanging over the heads of every industry, but one thing that’s certain is it will change the way we live and the way we work for a very long time.

In transportation, public transport will be less desirable, which can work to the benefit of the automotive industry and specifically for AVs.

Auto companies are no longer just auto companies, as we’ve moved far beyond mechanical pieces. This is now a very high-tech world, and those that succeed must view themselves as tech companies, and see their competitors as not just other automakers, but all the tech giants (Google, Apple, etc.) that are starting to dip their toes in the automotive market.

And they must attract the best minds to achieve the solutions needed for a successful mass launch of AVs on the world’s roadways.