Business Information Systems: Autonomous Cars Impact Analysis

This essay examines the profound influence of autonomous vehicle technology on businesses and society. It begins with an introduction to autonomous cars, followed by an analysis of their impact on various sectors, including technology companies, car manufacturers, and logistics firms. The essay ex...Read More

Running head: AUTONOMOUS CARS 0
Business Information Systems
Autonomous (‘driverless’) Cars

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Table of Contents
Introduction................................................................................................................................2
Impact of Autonomous Vehicle on Businesses and Society......................................................3
Issues and Opportunities relating to Autonomous Cars.............................................................4
Potential Problems.....................................................................................................................6
Adaptation of Autonomous Cars Technology by Businesses....................................................7
Organisations and Society Transition to Autonomous Cars......................................................8
Conclusion................................................................................................................................10
References................................................................................................................................11

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Introduction
An autonomous or driverless car is referred to a robotic vehicle which is designed in a way
that it allows travel between destinations without the requirement of a human operator or
driver. In order to qualify as fully “autonomous”, it is necessary that the vehicle is able to
navigate to different places without human intervention (Fagnant and Kockelman, 2015). An
autonomous vehicle travels to a predetermined destination through roads which are not
adopted or designed for its use. The advancement of technology has increased the market for
autonomous cars, and most of the leading car manufacturers are investing in the technology.
The autonomous vehicle technology has the potential to replace traditional vehicle industry in
upcoming years. There are a number of benefits of autonomous vehicle technology such as
saving of fuel, reduction in car crashes, hassle-free travel and others. This essay will focus on
analysing the influence of autonomous vehicle technology on businesses and society. This
essay will discuss the key issues, and challenges face by corporations relating to the
autonomous cars and examine the potential problem related to the topic as well. Further, the
report will evaluate how businesses will need to adapt and analyse how companies and
society will transition to autonomous cars.

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Impact of Autonomous Vehicle on Businesses and Society
‘The Guardian’ evaluates the potential impact of autonomous vehicle technology in the
article called “Look ma, no hands: what will it mean when all cars can drive themselves”. In
the article, Topham (2017) provided that Uber has entered into a billion pound business deal
with Swedish car manufacturer Volvo to make autonomous vehicle future possible. The
article evaluated how autonomous technology will have a substantial influence on a number
of key players who are associated with this technology. Marshall (2017) stated in his research
that autonomous vehicles could add $7 trillion to the global economy which proves its
potential to change various aspects of the transportation industry. Popularity of driverless cars
which influence businesses including technology companies, car manufacturers, online media
and retailers, logistics firms, lithium miners and others. Topham (2017) provided that
Google’s self-driving division (now called Waymo) is leading the autonomous vehicle
technology. Morgan Stanley has valued the company at $70 billion (£52 billion) which shows
its potential in the autonomous cars industry (Ohnsman, 2017). The deal between Uber and
Volvo is another example; Uber is focusing on becoming the market leader in driverless taxi
service by investing in autonomous vehicle technology.
In March 2017, Intel bought an Israeli company which manufactures chips and cameras for
self-driving vehicles called Mobileye for $15.3 billion even when the corporation is
generating annual revenue of $300 million (Lunden, 2017). Most of the car manufacturing
companies are collaborating or working with technology companies in order to incorporate
automated vehicle technology into their products. In Consumer Electronic Show (CES) 2018,
car manufacturing companies were teaming up with technology firms in order to provide
driverless vehicles prototypes. For example, companies such as Amazon, Cisco, NVidia and
Intel made announcements regarding driverless cars in CES which prove that influence of
autonomous cars on technology companies (Levy and Kolodny, 2018). Logistic companies
will be influenced by the popularity of driverless vehicles as well. One-third of the costs of
logistics firms, i.e. $7 billion are related to drivers’ wages (Topham, 2017). Logistic
organisations will be able to reduce their operating costs relating to drivers’ wages which will
result in improving their profitability. Introduction of autonomous trucks and other heavy
goods vehicles such as Tesla’s Semi-electric truck will change the business of logistics firms.

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With the growing popularity of electric vehicles, the demand for lithium batteries will grow
as well. According to the study of Transparency Market Research, the value of the lithium-
ion market will double in next seven years up to $77.42 billion (Transparency Market
Research, 2018). Along with positive impact, the popularity of autonomous cars will
negatively affect many businesses and sections of society. For example, traditional car
manufacturers have to change their business model as the number of household electric
vehicles will grow. Currently, leading carmakers are hiring software and tech firms as the
transportation industry changes. The surpassing of Tesla’s valuation over Ford and GM prove
the negative impact of driverless cars on car manufacturing firms (Lee, 2017). Many studies
have shown that requirement of motor insurance will reduce as well which will negatively
affect insurance corporations. On the other hand, Nick Reed, Bosch’s head of mobility
research, provided that model of motor insurance will change, instead of negatively affecting
the firms (Topham, 2017). The requirement of service stations and hotels will be reduced as
well if passengers get comfortable sleeping options in the autonomous cars.
The growth in autonomous car technology will influence different sections of society along
with businesses. For example, more than one million people earn their wage by working as
professional drivers, and they face the risk of losing their job if driverless cars become
popular. Popularity of autonomous vehicle might result in increasing the unemployment rate
which negatively affects a large number of people. The academic director of British
Transport research, Richard Cuerden, argued that the requirement of professional drives will
not eliminate and companies will hire them as a human backup in autonomous vehicles
(Topham, 2017). Many taxi companies will also prefer to use drivers in order to add a human
touch to the experience. The UK government has claimed to generate more than £46 billion
from freezing fuel duty. The popularity of all-electric vehicles will result in reducing millions
in revenue for companies. The revenue from traffic offence will reduce as well. The company
also generated revenue of £750 million from parking in 2016, and autonomous vehicles will
reduce this income as well. The reduction in revenue of the government will negatively affect
the society because the government uses the money for public development (Litman, 2017).
Therefore, the popularity of autonomous vehicles will have a substantial impact on different
businesses and society.

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Issues and Opportunities relating to Autonomous Cars
The popularity of autonomous vehicles will result in increasing many issues for organisations
and people. The key issue relating to autonomous cars is the safety of people. Various
autonomous driving technologies have been developed by companies such as Tesla, Google,
Intel, Uber, Nissan and others. The design details of these technologies vary, but most of
them are created and maintained on an internal map of surrounding which remains same for
each design. Driverless cars use sensors, radar, and lasers beams to analyse the road and work
properly (Driankov and Saffiotti, 2013). These sensors enable the driverless vehicle to create
a map of its surrounding and send such inputs to the software. The software then processes
such inputs, plans a route, and then sends instructions to the car. These inputs control braking
and steering and enable the car to avoid obstacles on the road. The problem with this system
is that cybercriminals can hack into the software of the car and use it to hurt others.
Cybercriminals can hack the software of autonomous car and control its functions such as
brakes or steering. Lack of control over the car can lead to a number of negative impacts
which can be dangerous for the driver as well as people on the road (Kumar and Michael,
2012). Autonomous cars did not have manual control for drivers such as steering or brakes
which increases the risk as well.
One of the benefits of autonomous cars is that they are able to communicate with other cars
and share information. For example, if a car is aware of an accident ahead on the road than it
can share such information with other vehicles which can assist them in changing routes. But,
the issue is that computers in autonomous vehicles will be able to transmit information to
each other in areas of poor reception (Schoettle and Sivak, 2014). The sharing of information
also raise people concern regarding sacrificing of their privacy because they cannot control
the data shared between two autonomous vehicles. There are different ethical issues relating
to autonomous vehicles as well. The key issue is that whether artificial intelligence (AI) is
able to make ethical decisions just as humans. For example, a driver can choose either injure
three people in a car or injuring a person on a motorcycle (Khanna and Barrett, 2017). But, it
is difficult to evaluate whether artificial intelligence will be able to take an ethical decision in
such situations. Unemployment is a serious issue relating to autonomous vehicles as well.
There are more than one million professional drivers in the UK who drive for a living, and
they will be unemployed after the popularity of autonomous vehicles. There are legal issues
relating to autonomous vehicles as well such as who will be responsible in case of an
accident.

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Along with many issues, there are a number of opportunities as well relating to driverless car
technology. The main opportunity is reducing in car crashes which improve the safety on the
road. People in the car will be free during their commute which provides different
opportunities to car manufacturers to entertain and advertise new products (Smith, et al.,
2010). Car manufacturing companies can collaborate with online media and retailers to
provide different services to people in their car such as movies, games or other forms of
media. Technology companies have the main opportunity since they can offer a number of
services to passengers, for example, the car can be connected with smart home, and it can
remind people that they are running low on food supplies or others. Autonomous cars will
enable car sharing, either from taxi fleets or when people are not using their cars. It will
create new jobs as people will be required to clean up cars between users. Jobs relating to ride
coordination personal support, customer service and others will increase as well. Driverless
cars increase business opportunities for battery manufactures as the demand for lithium-ion
batteries will grow (Dolgov, et al., 2010). The demand for insurance companies, lawyers, and
brokers will increase as companies are required to meet and comply with new transportation
standards. The autonomous vehicle technology will bring a number of opportunities for
organisations and society but evaluate of issues relating to the technology is necessary as
well.
Potential Problems
There are a number of safety and security risks relating to the autonomous vehicle technology
which creates many potential problems. Driverless vehicles are heavily dependent on their
software capabilities which can be hacked by cyber criminals to get an unfair advantage. The
lack of ability of software to assess different locations is another problem relating to
autonomous driving. For example, a driverless shuttle bus was being tested in Las Vegas, and
it involved in a crash in just an hour from its testing. Although the crash was not resulted due
to the fault of the vehicle, it shows how vulnerable autonomous technology is when
compared to the current transportation system. The artificial intelligence used in driverless
cars is unable to take ethical decisions in situations of ethical dilemmas (Bonnefon, Shariff
and Rahwan, 2016). Terrorist groups and cybercriminals can use autonomous cars as a mode
of spreading violence since they can hack and control its software directly through the
internet. Unemployment is a serious problem linked with autonomous vehicles as well since
it may eliminate the requirement of drivers who earn their living by driving people or goods

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from one place to another. There are a number of legal problems relating to autonomous
vehicles as well as the courts have to decide whom to blame in case of an accident. These are
a number of potential problems relating to autonomous cars which makes people and
organisations sceptical regarding the technology.
Adaptation of Autonomous Cars Technology by Businesses
With the growth in autonomous car technology, it is inevitable companies to avoid its impact
on their businesses. Most of the leading market players such as GM, Ford, BMW, Audi and
others are investing in this technology already, and some of them are launching them for
customers use as well (Muoio, 2017). Therefore, a number of businesses have to adopt in
order to support and get benefits of autonomous vehicle technology. For example, with the
change in the transportation system, infrastructure requirements will change as well. The
master plans created for car parking, airports, toll roads, high-speed trains and others are
required to be modified in order to support autonomous vehicles (Khanna and Barrett, 2017).
Effective roadmaps are necessary which puts human safety at the priority. The requirement of
parking lots will decrease along with revenue relating to them as well. Car manufacturing
companies are required to change their business model in order to stay relevant in the
industry. They are required to collaborate with different technology companies in order to
ensure that they offer different services through driverless vehicles. The role of energy
companies will grow along with the popularity of battery-based electric vehicles. The
companies are required to analyse how they can use vehicle-to-grid (V2G) model for
distributing and storing energy. V2G system saves electricity by returning it back to the grid
which saves energy and ensures that electricity is available for autonomous vehicles.
The hotel and motel industry will suffer substantially since people have the option to sleep in
their car while they are travelling. Therefore, the hotel industry is required to change their
business model in order to adapt as per the technology. The hotels and motels can offer
unique services to their customers in order to attack them. For example, they can reduce
parking costs and provide charging facilities for electric vehicles which is useful for people
who are travelling to long distance. Also, autonomous cars cannot provide the comfort of a
bed or services as a hotel to passengers that will encourage them to stay and relax at hotels.
Similarity, insurance companies are required to change their business model in order to adapt
as per the technology. Many studies have predicted that popularity of autonomous vehicles
will reduce US auto accidents by 90 percent (Ramsey, 2015). People might avoid taking

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motor insurance in the future with the reduction in the risk of car accidents. Nick Reed,
Bosch’s head of mobility research, stated that the model of insurance companies will change
because people will always be sceptical about the technology. Jobs of professional drives will
change as well, and transportation companies are more likely to use them as a backup in case
of an issue. The business of auto parts manufactures will change as well. The study of PwC
has shown that 50 percent of the automobile manufacturing costs will be relating to
electronics which is just one third currently (PwC, 2013). These are different examples of
how businesses need to adapt as per autonomous car technology.
Organisations and Society Transition to Autonomous Cars
Elon Musk, CEO of Tesla Motors, has claimed that people are two years away from sleeping
in their cars. Many experts estimate that first generation autonomous vehicle will launch
around 2020. Most of the leading transportation companies such as Ford, GM, BMW,
Mercedes, Audi, and others are investing heavily in the autonomous vehicle technology, and
they are planning to launch new vehicles in upcoming years (Munster, 2017). The transition
to autonomous cars will be led by transporting and technology companies. For example, Uber
has entered into an agreement with Volvo in order to manufacture 24 thousand driverless cars
by 2021. Similarly, Lyft is planning to build self-driving cars by collaborating with Magna,
auto parts supplier (Hawkins, 2018). Heavy investments made by these companies prove that
the future of autonomous cars is not far away and other businesses have to adopt as well.
Google might be leading the autonomous car technology by licensing its driverless
technology to car manufacturing companies. Waymo, autonomous car development firm
started by Google, has been working from 2009 in order to provide self-driving cars to
customers. Matt Johnson, Vice-President of Automotive MCU Group, has provided that there
are three stage of transition to autonomous vehicles (Atelier, 2015).
In the first stage, new cars will be launched by the companies with Advanced Driver
Assistance Systems (ADAS) and the blind spots of the system will be evaluated by
corporations in order to improve its effectiveness (Reimer, 2014). In the second phase,
humans will play the role of co-pilot, and autonomous vehicles will take over driving tasks.
The sensors, radar and camera system of the cars will collect necessary data that will result in
improving the overall performance of the technology. In the third phase, autonomous vehicle
technology will be capable of handling and detecting any potential threat of the road even
before human brain is able to analyse them (Gurney, 2013). At the same time, most of the

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organisations will change their business model in order to meet the requirements of driverless
vehicles. In the beginning, passengers will be sceptical of the technology, and they will prefer
some manual control over the vehicle, but slowly fully autonomous vehicles will start to enter
the market. The car manufactures will require taking permission from the government in
order to launch autonomous vehicles in new markets (Rousseau and Crane, 2015). On the
other hand, governments will create new transportation laws to ensure that safety of the
public is maintained. Therefore, the transition of organisations and society to autonomous
vehicles will be completed in different steps in forthcoming years.

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Conclusion
In conclusion, the popularity of autonomous vehicles technology is growing rapidly between
corporations and society. Most of the leading car manufacturing companies are investing in
the technology driverless technology and collaborating with technology companies to launch
new autonomous vehicles in the market. The popularity of autonomous vehicles influences
different parts of organisations and society, for example, increase in demand of lithium-ion
batteries, reducing in the business of hotels and motels, government’s revenue, change in the
business model of traditional car manufacturers and insurance companies. There are different
potential problems relating to autonomous technology such as security, safety, privacy, and
communication issues. Organisations are required to change their business model to avail
opportunities relating to autonomous vehicles. The transition of organisations and society will
complete in different steps. Improvement in technology relating to safety will assist in
expanding the market of autonomous vehicles and making it a part of the society.

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