Driverless cars may seem a bit like a futuristic fairy tale, or nightmare, depending on your perspective. These vehicles will move us around where we want to go without assistance from us, and will be much better at driving than we could ever hope to to be.
Most of us have heard about the driverless cars that Alphabet's (NASDAQ:GOOG) (NASDAQ:GOOGL) Google is working on, or have heard about Tesla Motors' (NASDAQ:TSLA) Autopilot system. But there's still a lot of confusion about what exactly a driverless (also called autonomous) car is, who makes them, and when they'll actually hit the streets.
So let's take a quick look at some of the biggest questions surrounding driverless autos (and the corresponding answers).
What's the difference between a semi-autonomous and a fully autonomous car?
I'll keep this on a fairly general level, but there are actually four levels of vehicle automation, according to the U.S. National Highway Traffic Safety Administration (NHTSA). The first level involves car features like electronic stability control and vehicle brake assist, and level two brings in more complicated systems that work in tandem, like vehicle lane sensors that work with adaptive cruise control features.
But level three is where the semi-autonomous features really kick in. The NHTSA says a driver can "cede full control of all safety-critical functions under certain traffic or environmental conditions" but will then take back over when the car can't handle a situation at this level.
A level four automation is considered a fully autonomous car and is "designed to perform all safety-critical driving functions and monitor roadway conditions for an entire trip," according to NHTSA. These cars will simply need a destination and will be able to go there -- with or without someone sitting in the car. This is the level Google is quickly approaching.
Why are companies building driverless cars?
Google and other companies likely want more information about users, which can be gathered from a car, in order to better sell ads and services. Carmakers may simply be moving in this direction because they're being forced to keep up with what the tech companies are making.
But one of the main reasons researchers and governments are funding driverless cars is because they'll be much safer than human drivers.
It's estimated that nearly 30,000 lives will be saved each year in just the U.S. once autonomous cars become ubiquitous. That would be a 90% decrease in car-related fatalities and could potentially save the U.S. economy $190 billion in traffic-accident-related expenses (like healthcare), according to a McKinsey report. And around the world, driverless cars could save 10 million lives per decade.
How exactly do these cars drive themselves?
The short answer to the question of how these cars drive themselves is: magic. The long version is that NVIDIA (NASDAQ:NVDA) and other companies use a combination of sensors, cameras, LIDAR (it's like radar, but with lasers), maps, and powerful computers that allow cars to navigate themselves and learn from past experiences.
NVIDIA's Drive PX 2 platform combines an artificially intelligent, on-board computer with the tech listed above in order to process massive amounts of information and give the car human-like situational awareness.
And the company recently took this even further when it unveiled its DGX-1 supercomputer, which will allow driverless cars to process some of their data through cloud-based servers.
By combining Drive PX 2 and DGX-1, NVIDIA says its driverless systems will be able to process 15,000 data points every second for each camera that's on an autonomous car.
Are there driverless cars on the road right now?
There are driverless cars currently on the road. Google has some, and Chinese tech giant Baidu is testing others. Audi, Ford, and General Motors are testing out their technology, too, as are others. But autonomous car testing is limited to just a few states right now, and fully autonomous vehicles can't be purchased by anyone yet. Additionally, U.S. laws require a licensed driver to be behind the wheel right now and the cars still have to have things like steering wheels (but Google's trying to change that).
Wait, doesn't Tesla already have a driverless car?
Not exactly. Tesla has a semi-autonomous system called Autopilot, which allows its Model S and Model X (and eventually the Model 3) to drive themselves on highways, and it can even park itself, drive in and out of a garage on its own, or meet you in front of your house with its summon feature.
But Autopilot can't drive itself all the time, drive on every road, or pick you up at the airport just yet. Tesla CEO Elon Musk has said his company will have fully autonomous cars by 2018, which would match up pretty closely with the launch of its Model 3. But Tesla, and all other tech companies and carmakers, are at the mercy of the U.S. government's ability to establish laws and guidelines. So Musk's goal may be a bit premature.
How much will these cars cost?
For all the benefits, it's surpisingly inepxensive to add driverless technology to a vehicle. It's estimated that the additional cost for autonomous technology will add between $7,000 and $10,000 to the price of a car in 2025. But that will drop down to around $3,000 by 2035, according to IHS.
When will I be able to take a nap in the car, instead of driving?
According to IHS Automotive, we won't reach driverless car ubiquity until sometime after 2050.
Before that, it'll probably be a progression of semi-autonomous systems (similar to what we have now) that evolve into fully autonomous ones. By 2035, about one in 10 new cars sold will be fully autonomous, according to IHS.
What are the best stocks to invest in for driverless cars?
Of course, Google is a leader in the space right now, and Tesla is a pioneer in pushing semi-autonomous features into its vehicles. Neither of these companies will really bring in any direct revenue from driverless cars, though, or at least not for a while. Instead, I would suggest investors focus on NVIDIA and its current lead in the space.
The company makes more than half of its revenue from its gaming division, but as more carmakers and tech companies expand their driverless car ambitions, NVIDIA's automotive segment is poised for substantial growth. NVIDIA's graphics processors and technology are already in more than 10 million vehicles on the road today snd about 50 automakers already use NVIDIA's driverless tech. I think the company is positioned to keep this lead as more automakers dive into driverless technology.