Driving UK leadership in Connected and Autonomous Vehicles

Not a day goes by without further news of new trials and technology advancements in respect of Connected and Autonomous Vehicles (CAV) and the associated potential for platooning and ride sharing. And yet, for the average person, the advent of driverless cars still seems the stuff of science fiction.

So what will be the factors driving adoption of CAV in the UK, and what are the things that transport authorities and regulatory bodies should be considering to ensure that the opportunities of a CAV world can help us to meet our wider social, economic and policy objectives?

Our recent research suggests a "base case" scenario of 25 % of UK new vehicle sales being Level 4/5 CAVs by 2030. But this simple statistic hides a wide variety of assumptions, different use cases and take rates and there are some industry sources working to far higher estimates.

Many questions about private users' behaviour remain. For example, to what extent will people own CAVs themselves or use fleet services? Will different models emerge in urban areas compared to suburban and rural areas? Will the rise of CAVs generate more miles travelled or fewer? Will people be comfortable in shared AVs with other passengers they don't know?

But we can start to point to the early adoption curve. For example, if the additional cost of CAV 'kit' is in the region of $5,000 per vehicle, take up will very likely be accelerated by fleet and Mobility as a Service (MaaS) providers who can effectively amortise the cost over their whole customer base as each vehicle will be used much more intensively than privately owned cars. For this reason, we also expect that CAV will be taken up more quickly in commercial vehicle fleets and HGVs, the latter especially via retrofitting, as the cost savings generated by the reduced need for drivers will make the business case for investment compelling.

So what are the hurdles? In our recent Autonomous Vehicle Readiness Index, KPMG looked at 20 countries worldwide and assessed AV readiness across 26 variables in 4 categories: Policy, Technology, Infrastructure and Consumer acceptance. The UK ranked 5th overall, behind the Netherlands, Singapore, the US and Sweden.

The high point for the UK in the study was in the area of Policy and Regulation, where the UK ranked 4th – particular note was given to the UK Government's commitment to creating a supportive and sustainable policy environment – further evidenced by the Law Commission's review of of how existing road traffic laws may need to be adapted for CAVs announced by Government earlier this week.

We believe the main hurdles for the UK are around connectivity and infrastructure. In particular, the patchiness of our 4G network and the readiness of our road infrastructure. In this context, we collectively need to give serious consideration to the key enablers for CAV - specifically the infrastructure investment which will be needed and the responsibility for specifying, commissioning and funding this infrastructure.

This is all the more important in the context of the rise of electric vehicles and the implications for road tax take from fuel duty and vehicle excise duty. We urgently and proactively need to address this impending funding gap, ideally with creative and innovative solutions which enable us to deliver world-leading infrastructure for this next industrial revolution.

Which brings me to the role of policy makers, transport authorities and regulators. It is excellent news that the UK is recognised as a leading location for testing and proving of CAVs. However, we need to ensure that we are shaping the development of the industry with a view to our wider policy objectives – be they reducing congestion, improving air quality, increasing access to transport, driving productivity / skills. The rise of CAV, especially combined with MaaS creates unprecedented opportunities for public authorities to influence people's behaviour in response to CAV, and to drive new and innovative transport solutions (public / private / MaaS across all modes) which also free up public land, increase people's useful leisure time, increase equity and improve health outcomes. But this will not come without a proactive, policy-led approach.

The potential public responsibilities in this space are significant and varied – how do we ensure people continue to walk and cycle for part of their journeys? Do we have a responsibility to improve access for rural users? For disadvantaged communities? How does CAV play into the policy imperative to reduce deaths on roads; is it the answer? Should public authorities seek to become 'system operators', routing traffic in optimal ways to minimise congestion – and, if so, what data will they need to access in order to do this effectively? And this is without mentioning much-discussed risks such as human-AV interaction or cyber-attack.

Ultimately, we are looking to public authorities to understand the risks from CAV – but also to generate a framework of regulation, guidance and technology standards which maximises the opportunities from CAV, motivates people to embrace the new technology and minimises our chances of a congested, unequal dystopia.