Sci-fi fans are familiar with Robo-taxis, Auto-taxis, and other types of autonomous vehicles that are envisioned to populate the roads of the future. However, since the hype of 2016-2018, the sector has become quieter, largely due to the successive crises: the pandemic in 2020, geopolitical tensions in 2022, and the social and political turmoil of 2024.
These factors have relegated the development of autonomous vehicles back to research and development (R&D), with activity concentrated mostly in China and the USA, and much less in Europe, where the focus has shifted to the transformation of car manufacturing from internal combustion engines to electric propulsion. This is partly due to regulatory environments and political priorities.
Support for increased autonomy in light-duty vehicles comes from various angles, with different factors carrying more weight depending on the region, particularly for autonomy levels 4 or 5, where no human driver is required. In contrast, lower levels of autonomy mainly enhance the driving experience.
For ride-hailing services like Uber or Lyft, as well as for buses, removing the need for a human driver could reduce costs by as much as 80 to 90%. This reduction comes from eliminating driver wages and increasing vehicle usage (potentially around the clock). Some studies estimate that Robo-taxis could account for 60% of the Chinese market by 2030.
For the average motorist, switching from car ownership to mobility-as-a-service (MaaS) could lower mobility costs by as much as 70%.
For the planet, this would completely transform the automotive ecosystem. Individual car sales would be replaced by contracts and tenders between car manufacturers and fleet owners/operators. The total number of vehicles on the roads could drop by 30 to 50%, equivalent to around 500 million vehicles. While CO2 emissions from vehicles with internal combustion engines might not fall proportionally due to increased vehicle usage, there would still be significant reductions. With electric vehicles, the reduced demand for car manufacturing would ease the strain on resources like critical materials used in battery production.
For individuals who are unable to drive—such as the elderly, sick, disabled, or those who cannot afford a car—autonomous vehicles would offer affordable mobility, even in remote areas.
From a larger societal perspective, the widespread adoption of autonomous vehicles could reduce traffic fatalities. In China, for instance, about a quarter of a million people die annually in road accidents—3.5 times more than in France when adjusted for population. Real-time experiments in the U.S. show a sevenfold increase in safety performance with Level 4 autonomous vehicles.
In China, the focus on road safety, combined with control over the number of vehicles through a licensing system, aligns with the country’s strategy of global leadership in electromobility. The Chinese government is keen to integrate autonomous driving into its push for electric vehicles, where reliance on advanced electronics, such as artificial intelligence (AI), and the shift away from driving-related tasks resonate with a population that embraces technological innovation.
In the U.S., where Uber was born and the concepts of the SUV and light trucks were popularized, autonomy could represent the next frontier, particularly in congested cities where public transportation is often lacking. The fierce competition with China for leadership in high-tech sectors, including AI and quantum computing, further fuels this drive. Silicon Valley plays a key role in the development of autonomous driving. Of the seven companies licensed to test-drive autonomous vehicles in California, four are U.S.-based (including Alphabet subsidiary Waymo and Amazon subsidiary Zoox), and three are Chinese (including IT giant Baidu).
In Europe, stricter driving regulations and the challenges of test-driving autonomous vehicles have dampened interest in this sector. Additionally, European politicians and regulators tend to favor public transport, viewing cars with more skepticism. While autonomous driving may reduce bus fares, it offers little benefit to rail services like trains and metros. As a result, investment in autonomous driving in Europe is minimal compared to China and the U.S., which together accounted for 98% of the €100 billion spent on the technology in the last decade. Both countries continue to invest in, improve, and test autonomous driving technologies, which remain expensive, especially due to the cost of LIDAR sensors.
There is little doubt that autonomous driving will become the standard in the future. However, the high-tech race between China and the U.S. may leave Europe trailing behind, as it has in many other technological domains.
Philippe Marchand is a Bioenergy Steering Committee Member of the European Technology and Innovation Platform (ETIP).
