Driving the Tango in Buenos Aires
December 31, 2023
This Week in The Autonomy Economy, The Road to Autonomy Index returned 0.36%, President Javier Milei of Argentina sent a 351-page omnibus bill to Congress that included the authorization for “driving by autonomous systems for self-driving vehicles, whether private, passenger or cargo”.
UK Transport Secretary Mark Harper said in a BBC 4 radio interview that he expects to see autonomous vehicles on the roads of the UK by 2026. GM continues to send mixed signals to the market as it relates to Cruise and Aurora continues to be transparent about the development of the Aurora driver.
As we turn the calendar to 2024 at midnight, the dawn of the autonomy economy is upon us as the autonomous vehicle industry enters it’s next phase — commercialization.
With this change, we will begin to see a divergence between the autonomous vehicle and autonomous truck industries. Each industry will begin to separate and focus their messaging and priorities on their own unique interests with a less emphasis on collective priorities.
The separation is healthy as it signals to the market and investors that each industry is solely focused on their respective businesses. Autonomous trucks are not going to compete with autonomous vehicles and vice versa.
As part of this change, we are looking for both autonomous vehicle and truck companies to hire seasoned executives with unique skill-sets to turn the start-ups into cash-flow generating companies with a long-term focus on profitability.
2024 will be the year that autonomous vehicle and truck companies build the business case as they prepare for potential IPOs in 2025/2026.
It’s going to be an exciting year. Each and every Sunday, we will continue to share our unique perspective and research with you along with a new episode of The Road to Autonomy podcast every Tuesday.
Thank you for being a subscriber and here is a big cheers to a successful 2024.
GM is a The Road to Autonomy Index component company
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What’s Moving the Markets
Driving the Tango in Buenos Aires
On December 27th, President Javier Milei of Argentina sent a 351-page omnibus bill to Congress that included authorization for “driving by autonomous systems for self-driving vehicles, whether private, passenger or cargo”.
With his administration’s Law of Bases and Starting Points for the Freedom of Argentines omnibus bill, President Milei is looking to stimulate and reboot Argentina’s struggling economy.
Argentina is the third-largest economy in Latin America with a GDP of $632.24 billion behind only Brazil and Mexico. Yet their economy has been suffering under inflation that surpassed 113% in July 2023, a declining Argentine peso that lost 33% of its value against the U.S. dollar between 2022 and 2023 and a poverty rate that has been estimated to be as high as 40%.
Numbers do not lie, Argentina’s economy is in shambles and President Milei is taking drastic measures trying to stabilize the economy and then reboot it. Having autonomous vehicles as part of this strategy is a wise move, a move that is forward looking.
A move that will have a long-term positive economic impact on Argentina’s economy, as autonomous vehicles will create new high-paying jobs in the services sector.
Individuals will service the vehicles, oversee the monitoring of the vehicles, the coordination with freight pick-up and drop-off shipments and the eventual integration of autonomous vehicles into the tourism sector.
Tourism serves as one of the backbones of Argentina’s service sector which contributes 52.5% to Argentina’s GDP and employs 78.1% of the active workforce in the country.
Argentina has specialised in areas of high-tech services and is highly competitive in software development, call centres, nuclear energy and tourism. The telephone and ITC sectors are also developing dynamically, as well as tourism, which is increasingly becoming an important sector.
In 2022, tourism experienced a significant growth as the depreciation of the Peso made the country an attractive destination for foreign visitors. As a result, the number of tourists in Argentina bounced back to pre-pandemic levels in 2022.
– Santander Trade Markets report, December 2023
The Argentine economy is ripe for the introduction and the deployment of autonomous vehicles and trucks. In our opinion, the best first deployment would be to integrate an autonomous vehicle service into a tourism experience in Argentine Patagonia. There is little traffic, the roads are well defined and there is a strong demand to move around and explore.
Read Law of Bases and Starting Points for the Freedom of Argentines omnibus bill here (English Translated PDF). The Self-Driving language can be found on pages 169 – 171.
Our take: The bill in it’s current form is interesting and there are technical definitions that need to be worked out such as how the government will define the average accident rate, but it’s a positive step forward. The development and deployment of autonomous vehicles and trucks in South America is good for Argentina’s economy.
Autonomous Vehicles Coming to the UK in 2026
The commercial deployment of autonomous vehicles is coming to the UK. In a December 27th interview with BBC Radio 4, Transport Secretary Mark Harper said that he expects to see autonomous vehicles on the roads of the UK by 2026.
The timeline is possible as legislation to legalize autonomous vehicles in the UK is currently going through Parliament. Secretary Harper’s stated goal is have some form of legislation by the end of 2024, laying the groundwork for commerical deployments in 2026.
Autonomous vehicles will be good for the UK economy. They have the potential to reduce the amount of money that the UK spends on it’s NHS (National Health Service). The reduction in spending can come from a decrease in car crashes, pedestrian/bike accidents and unfortunate roadway incidents. In 2020, roadway incidents cost the UK economy £3.5 billion in health care expenditures.
There is a real potential for this sort of technology to actually improve safety on the roads, not just for drivers, not just for passengers, but for other vulnerable road users – pedestrians, cyclists – to really improve road safety, which is a real win for everybody.
– Secretary Mark Harper – BBC Radio 4 interview – December 27, 2023
In 2023, the NHS is projected to overspend its £155.1 2022/23 billion budget by £1.7 billion according to the Nuffield Trust. Any reduction in NHS spending without sacrificing the quality of care will be good of the UK economy.
Our take: Autonomous vehicles have the potential to reduce NHS/Health care spending in the UK. A reduction in health care spending with safer roadways is a win-win scenario that benefits everyone and the UK economy.
San Francisco Continues to Haunt GM
On December 22nd, GM filled a lawsuit (PDF) against the City of San Francisco alleging that the city unfairly taxed the company $108 million over seven years.
The timing of the lawsuit is interesting. First Cruise halted all operations on October 24th, then Co-Founder & CEO, Kyle Vogt resigned on November 19th, followed by his Co-Founder Dan Kan the next day, and on December 14th, Cruise announced a 24% reduction in the workforce including nine key executives. Then on December 22nd, the lawsuit.
GM appears to be putting San Francisco in the rear-view window.
On the latest episode of The Road to Autonomy podcast, David Welch, Detroit Bureau Chief, Bloomberg and Grayson Brulte discussed what the future could look like for GM and Cruise.
In a wide-ranging conversation they touched on what GM’s plans could be for Cruise, will GM pivot Cruise to developing personally owned autonomous vehicles or will GM look to potentially license Cruise’s technology to other OEMs.
Listen to What is The Future of Cruise? on Apple Podcasts and Spotify
Our take: Why now? Why seven years later? Is GM planning to shutdown Cruise operations in San Francisco and pivot to a new city? Perhaps Miami? Bottom line in our opinion, something is brewing.
GM is a The Road to Autonomy Index component company
Social Buzz
Transparency Builds Trust
Aurora continues to be transparent about the development of the Aurora driver and how the Aurora driver handles complex situations. By sharing driving situation clips on X, Aurora is helping to develop and maintain trust with the public, regulators and elected officials.
Without trust, the entire autonomous vehicle/truck industry collapses. We give Aurora immense credit for their continued transparency as they develop and commercialize the Aurora driver.
On a previous episode of The Road to Autonomy podcast, Sterling Anderson, Co-Founder & Chief Product Officer, Aurora joined us to discuss the Aurora product and why it’s important to develop a profitable product.
The World’s Best Product is a Very Profitable Product (November 14, 2023)
Our take: As Aurora gears up for commercial operations in 2024, we are keeping a keen eye on their public messaging strategy and how it evolves heading into the end of the year.
The Road to Autonomy Index® / Weekly Performance
The Road to Autonomy Index® is a high-definition lens into the emerging world of autonomous vehicles. It is the world’s first and only pure-play index designed to measure the performance of the autonomous vehicle/truck market.
For the week of December 26, 2023, The Road to Autonomy Index returned 0.36%, the S&P 500 returned 0.38% and the NASDAQ 100 returned 0.29%.
The Road to Autonomy Index underperformed the S&P 500 by 0.2% and outperformed the Nasdaq 100 by 0.07%.
The top performing stocks in The Road to Autonomy Index this week were:
- Sony returned 3.27%
- Toyota returned 2.96%
- FedEx returned 1.99%
The Road to Autonomy Index has returned 19.95% since it was launched on Monday, April 17, 2023.
S&P Dow Jones Indices is the custom calculation agent for The Road to Autonomy Index.
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Latest The Road to Autonomy Podcasts
The Road to Autonomy podcast hosted by Grayson Brulte is a podcast featuring unconventional conversations about the future of mobility and the emerging autonomy economy. New episodes every Tuesday.
What is The Future of Cruise?
David Welch, Detroit Bureau Chief, Bloomberg joined Grayson Brulte on The Road to Autonomy podcast to discuss the future of Cruise and how the robo-taxi market will shakeout. What moves will Waymo, Zoox and Motional make now that Cruise has been sidelined for the foreseeable future?
Listen on The Road to Autonomy | Apple Podcasts | Spotify
Tuesday, December 26, 2023
What if we Electrified the Trailer?
Ali Javidan, Founder & CEO, Range Energy joined Grayson Brulte on The Road to Autonomy podcast to discuss electrified trailers and the impact that these trailers will have on truck fleets.
Listen on The Road to Autonomy | Apple Podcasts | Spotify
Tuesday, December 19, 2023
Future of In-Car Experiences
Jana Breitkopf, Managing Director, Mercedes pay USA recently joined The Road to Autonomy podcast where she discussed how Mercedes pay is enabling the future of in-car experiences.
Listen on The Road to Autonomy | Apple Podcasts | Spotify
Thursday, December 14, 2023
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A weekly newsletter featuring insight and analysis on the autonomy economy™ and how the financial markets are viewing its emergence.
All price references and market forecasts are as of the date that this newsletter has been sent. The Road to Autonomy is not providing any financial, economic, legal, accounting, or tax advice or recommendations in this newsletter. The information contained in this newsletter does not constitute investment advice and should not be relied upon to evaluate any potential transaction.
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