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Alex Herbert
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Will Google’s self-driving car drive growth in the industry?

Every now and then there is a step change in an industry that dramatically alters the landscape and results in huge opportunities for growth. Is this the case with Google’s self-driving car? Alex Herbert, Regional Managing Partner of Prestige Wealth Solutions, investigates.

The car industry has seen a dramatic step change and boom in growth before: with the launch of the Model T Ford. 

In the early days of the 20th century, motor cars were hand-made luxury objects, restricted to being expensive toys for the rich. Henry Ford changed all of that with his Model T Ford, which made famous the moving production line. This greatly improved the efficiency of car production, slashing prices and making cars affordable to the middle classes. In many ways, Ford created a new industry. 

The driverless car
One such breakthrough may be about to happen. For years now, Google has been developing its self-driving car technology – and its autonomous vehicles have already covered hundreds of thousands of miles on public roads in California without incident. 

The technology was initially added to standard production cars but this year Google showed its own purpose-built autonomous car. The new car is a two seat model with a rounded shape and friendly ‘face’ to the front. Inside, the car does not have any of the usual controls. There is no steering wheel and no pedals. Instead, there are simply two buttons between the seats: one to start the car and one to stop it.

Google’s car is the culmination of a group of technologies that have been around for a long time. Automatic crash prevention systems are able to detect obstacles and brake if the driver doesn’t react. Parking assist systems, meanwhile, can steer the car into a bay that many drivers may feel is too tight. Google has said that it will have its autonomous cars in production by 2017 and the technology could be the biggest thing to happen to the motor industry since Ford’s Model T.

The impact of autonomous cars
At PWS in Dubai, we are already considering the impacts of this technology. Some of the changes could be universally positive. There could be a dramatic fall in car crashes and road traffic injuries as the new autonomous cars prove to be much safer than driven cars. The cars will communicate with one another and automatically adapt to traffic conditions, rerouting where needed. This will greatly reduce congestion and journey times, hence reducing fuel consumption and pollution.

The effects of other changes could be just as far-reaching, but they could affect different industries in different ways. Google has said that it intends to increase car utilisation from the current 5% to nearer 75%. That means that far fewer cars will need to be built, with a subsequent loss of income for the car industry and government, as licensing and tax revenues decline. Far less fuel will be needed. 

Understanding how these changes will impact various industries and companies will be vital in making investment decisions in many sectors in the coming years – and Prestige Wealth Solutions is keeping abreast of the funds and fund managers that are positioned to take advantage of exciting new technologies. 

If you would like to discuss your portfolio, please email Alex Herbert today. 

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