Japan is Preparing for The Autonomy Economy
March 24, 2024
This Week in The Autonomy Economy, The Road to Autonomy Index returned 2.64%, Japan continues to prepare for the autonomy economy, VW and Mobileye have entered into an unconventional autonomous driving partnership and Wendy’s is taking to the sky with Wing and DoorDash.
Waymo is expanding into LA, the heart of car culture. But is it truly still a car culture? Or is it merely a culture of dependence on the car?
In San Fransisco two international artists created a “How (not) to get hit by a self-driving car” art installation. It’s their take on the classic game of frogger. While it’s lighthearted without malintent, it could potentially lead to individuals turning this into a YouTube game with the goal of gaining fame and notoriety.
When it comes to the debate around autonomous vehicles, there is a need for civilized, open and honest conversations. Expressions through art are wonderful and encourage as long as they are not destructive.
Autonomous vehicles and autonomous trucks are going to transform the global economy. Japan is currently preparing for this change, as the country faces the cruel realities of demographics and declining birth rates.
Autonomy will be a global phenomenon and an economy that will transform our lives. This is the autonomy economy and we have created a new podcast called Autonomy Economy documenting it’s emergence.
Delving deep into the intricate connections between autonomy and global economics, the Autonomy Economy podcast aims to unravel the profound economic impact that autonomy will have on the global economy from an insider’s perspective.
Autonomy is no longer confined to the realms of science fiction; it is now an emerging economy. An economy we call the autonomy economy.
The autonomy economy will touch aspects of our lives in ways we have yet to truly imagine. These stories have not been told until now.
New episodes of Autonomy Economy will be released every Wednesday.
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Mobileye and Wing parent Alphabet are The Road to Autonomy Index component companies
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What’s Moving the Markets
Mitsubishi Corp Invests in TIER IV
The autonomy economy continues to emerge in Japan. On March 14th, Mitsubishi Corp announced an investment in TIER IV, a Japanese open-source autonomous driving technology start-up.
Japan, a country with an aging population, declining birthrate and a growing shortage of commercial vehicle drivers is actively preparing for a future with a shortage of drivers. To prepare for this future, companies are investing in autonomy and autonomous driving technologies. Without autonomy, Japan’s economy will decline, leading to a recessionary environment.
The Japanese government clearly understands the economic ramifications of the situation as the government is aiming to have autonomous vehicles running in over 50 locations in 2025 and over 100 locations by 2027. These are ambitious targets, but realistic targets as Japan faces a potential economic crisis.
Our take: We are bullish on the development, deployment and commercialization of autonomous vehicles and trucks in Japan. Japan is currently one of the most interesting markets in autonomy.
VW and Mobileye Expand Their Relationship For Now
On March 20th, VW and Mobileye announced they are expanding their autonomous driving relationship for now. Mobileye’s SuperVision and Chauffeur platforms will be available on 18 models across Audi, Bentley, Lamborghini, and Porsche brands.
While the headline press announcement is good for Mobileye, the language used in the press release is not so good. VW used pretty strategic language to hedge their bet with Mobileye.
In the long term, the Volkswagen Group aims to rely on its own complete in-house system: Partnerships with Bosch and Qualcomm, as well as with Horizon Robotics in China, will be continued with a focus. All driver assistance systems are to be based on the software architectures developed by Volkswagen’s Cariad company.
– Automated driving: Volkswagen Group intensifies collaboration with Mobileye Press Release, March 20, 2024
What caused this public hedge? Was it past mistakes VW made when they tried to partner with start-ups on autonomous driving technologies? Aaron Rakers, CFA Equity Analyst at Wells Fargo Securities sums it up well in a recent research report.
We continue to view OEM in-house L3/L4 efforts skeptically.
– MBLY: Volkswagen SuperVision and Chauffeur Win for 18 Models, March 20, 2024 Wells Fargo Securities report
We agree with Mr. Rakers assessment. Overall, we are not bullish on VW’s in-house development of autonomous driving technologies or the “for now” partnership with Mobileye. Furthermore, we are concerned about VW’s joint-venture with Horizon Robotics and what the implications could be if VW ever decided to expand that development relationship to the U.S. market.
If VW one day makes the strategic blunder of integrating any of Horizon Robotics autonomous driving tech in cars bound for the U.S., the company will be met with fierce political resistance and skeptical U.S. consumers.
Then there is Qualcomm. Qualcomm is poised to become Mobileye’s biggest competitor and their new “partner” VW has reiterated their support for their relationship when announcing the Mobileye deal. Who would enter into that deal when there is a mistress in plain sight?
The way the announcement was worded raises the big question; does VW even have a long-term sustainable autonomous driving strategy?
Our take: VW needs to rethink their autonomous driving strategy. First Aurora, then Argo AI, now Mobileye, Horizon Robotics and Cariad? Will the real VW autonomous driving strategy please stand up?
Mobileye is a The Road to Autonomy Index component company
The New LA Car Culture: Autonomous Vehicles
As Waymo expands service to Los Angeles, it is embarking on a new journey — winning over car culture. Car culture in LA is not the same car culture that first emerged in the early 20th century. Today, it’s a culture of dependence, not a culture of cruising or expressionism.
Speak to Angelenos and they will tell you that the car is a way of life in LA, but they will also tell you they “hate” driving because of the traffic and congestion. If you want to go from the Westside of LA to Beverly Hills, it could take you an hour and a half. Better plan ahead and pack a snack as you have to cross the 405. It’s a hike. It’s stop and go the entire way.
Sitting in the drivers seat in stop and go traffic gets boring. When drivers get bored, they tend to reach for their phones. When they reach for their phones, the risk of a fender bender or a serious crash dramatically increases.
The boredom problem is solved with autonomous vehicles. During that hour and a half journey, you can take a nap, talk on the phone, scroll Instagram or play music as loud as you want, because there is no driver. There is no driver to tell you to turn it down, listen to your conversation or pressure you for a tip.
Riding in a Waymo is a safe, convenient and pleasurable way to get your destination without having to fight traffic. Angelenos spend over 100 hours a year on average each and every year in traffic. Riding in a Waymo instead of driving, could give Angelenos 100 hours of time back a year.
What would you do with those extra 100 hours? Write a movie script or a TV show? After all, it’s Tinseltown. Anything is possible.
Our take: Waymo will improve the lives of Angelenos. Waymo’s will provide a consistent experience that will be the backdrop for several Only in LA moments. Burton Cummings had a great Only in LA moment, when he drove Jim Morrison around the Hollywood Hills one evening in the 60’s. Now that Only in LA moment will be a Waymo experience.
Waymo parent Alphabet is a The Road to Autonomy Index component company
It’s a Flying Frosty
Wing, an Alphabet company announced a partnership with DoorDash and Wendy’s on March 21st. Customers in Christiansburg, VA now have the opportunity to have their meal delivered by a Wing autonomous drone with-in 30 minutes.
The big test will not be the reliability of the drone, it will be the french fries test. Will the french fries arrive crispy? If the fries arrive crispy and the frosty cold, it’s a win-win situation for both the restaurant and the customer.
If you are interested in learning more about Wing, Wendy’s and the QSR (Quick Service Restaurant) business, we would recommend the following podcasts:
- The Year of Autonomous Drone Delivery, A Conversation with Shannon Nash, Chief Financial Officer, Wing (February 20, 2024)
- The Brand is the Experience, A Conversation with Roger Webb, Lifetime Student of the Restaurant Industry (January 26, 2021)
Our take: Drone delivery is scaling in the United States. We recently had the opportunity to experience a Wing autonomous drone delivery in Texas and came away impressed.
Alphabet is a The Road to Autonomy Index component company
Social Buzz
Waymo Expands Testing to D.C.
On March 18th, Waymo announced they are expanding testing to Washington D.C. The driving environment in D.C. will expose the Waymo driver to new and diverse driving environments such unexpected road closures, stressed drivers and unusual traffic patterns.
Our take: This is another positive step in the development of the Waymo driver. Waymo continues to be the leader in the development and commercialization of robo-taxis.
Waymo parent Alphabet is a The Road to Autonomy Index component company
May Mobility Raises More Capital From Japan
On March 19th, May Mobility announced Tokyo Century Corporation, a financial services company invested in the company. The investment by Tokyo Century Corporation continues the trend of May Mobility successfully raising capital from Japan.
Last year, May Mobility successfully raised a $105 million Series D. NTT, a telecommunications group led the round with an investment of $66.9 million with participation from Aioi Nissay Dowa Insurance. As part of their investment, NTT obtained the exclusive rights to sell May Mobility’s self-driving system in Japan.
Japan with an aging population, declining birthrate and a growing shortage of commercial vehicle drivers is one of the most interesting markets globally for the introduction and commercialization of autonomous vehicles and trucks.
If you are interested in learning more about May Mobility, we would recommend the following podcast:
- Driverless in Sun City, A Conversation with Edwin Olson, CEO & Co-Founder of May Mobility (January 16, 2024)
Our take: Keep your eyes on Japan, as come April 1st the commercial driver shortage will accelerate because of the stricter enforcement of labor overtime rules. According to Japan’s government, this stricter enforcement will create a 14% shortfall in trucking capacity this year and a 34% shortfall in fiscal 2030 according to Japan’s government.
May Mobility investor Toyota Motor Corporation is a The Road to Autonomy Index component company
Art as Political Theatre
Art has meaning. It expresses thoughts, desires, wants and feelings. In San Fransisco, outspoken critics of autonomous vehicles are not shy about expressing their feelings.
They have been filmed hitting a Cruise autonomous vehicle with a hammer, burning a Waymo autonomous vehicle to the ground and putting cones on Cruise vehicles to disable them. Their tactics have drawn attention to their cause, but unfortunately their actions were destructive.
Now, two international artists in San Francisco are expressing their feelings through art. While we feel the art installation could continue to further stoke the negative sentiment around autonomous vehicles, we applaud the artists for not vandalizing autonomous vehicles as art.
Our take: Art is special. Art is a passion. Art should be cherished and studied. No mater the art, one has to respect the creative vision of the artist.
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 March 18, 2024, The Road to Autonomy Index returned 2.64%, the S&P 500 returned 1.45% and the NASDAQ 100 returned 1.68%.The Road to Autonomy Index outperformed the S&P 500 by 1.19% and outperformed the NASDAQ 100 by 0.96%.
The top performing stocks in The Road to Autonomy Index this week were:
- Micron returned 13.84%
- Toyota Motor Corporation returned 12.75%
- FedEx returned 12.16%
S&P Dow Jones Indices is the custom calculation agent for The Road to Autonomy Index
Follow The Road to Autonomy Index on Google Finance
The Road to Autonomy Index Component Companies
Latest The Road to Autonomy & Autonomy Economy Podcasts
The Road to Autonomy and Autonomy Economy podcasts are hosted by Grayson Brulte. The Road to Autonomy features unconventional conversations about the future of mobility.
Autonomy Economy features an insider’s perspective on the economics of autonomy. New episodes every Tuesday and Wednesday.
Autonomy Economy: Economic Impact of Autonomous Vehicles on Health Care
Dr. Peter Weiss, Board Certified Physician and Health Care Entrepreneur joined Autonomy Economy podcast to discuss the economic impact that autonomous vehicles will have on health care.
Listen on The Road to Autonomy | Apple Podcasts | Spotify | YouTube Music
Wednesday, March 20, 2024
The Partner Approach to Developing Autonomous Driving Systems
Steven Jenkins, Vice President of Technology Strategy, Magna joined The Road to Autonomy podcast to discuss Magna’s partner approach to developing autonomous driving systems.
Listen on The Road to Autonomy | Apple Podcasts | Spotify | YouTube Music
Tuesday, March 19, 2024
Insights into The Rideshare Industry and The Growth of Uber
Harry Campbell aka The Rideshare Guy joined The Road to Autonomy podcast to share his insights into the rideshare industry, the role that power drivers play in the ecosystem and his thoughts on Uber’s growing hybrid network.
Listen on The Road to Autonomy | Apple Podcasts | Spotify | YouTube Music
Friday, March 15, 2024
Subscribe to This Week in The Autonomy Economy™
A weekly newsletter featuring insight and commentary 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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