The Growth Of The Autonomous Car Market – Infographic

The autonomous car market is currently growing at an existential rate and many driverless vehicles are expected to be on our roads this year, and in large numbers. Let’s take a look at the growth of the autonomous car market.

the-growth-of-autonomous-car-market

 

Source: Get Off Road

Costco Sold 58,000 GM Cars During a Holiday Promotion

2016 Chevrolet Cruze:  
Provided by General Motors Co.

Beginning October 2 and ending January 4, Costco Wholesale Corp. (NASDAQ: COST) and General Motors Co. (NYSE: GM) sponsored a promotion for Costco members who wanted to purchase a new GM car. Sales totaled approximately 58,000 GM vehicles for the three-month promotion, up 34% year over year and well above Costco’s estimated 20% increase.

The offer featured GM supplier pricing and included all qualifying manufacturer rebates and incentives on a selection of vehicles, including trucks, sport utility vehicles and luxury and fuel-efficient models. Buyers also received a $300 or $700 Costco cash card for completing a Costco member satisfaction survey.

Customers were also asked if the promotion was a “deciding factor” in their purchase of a GM car instead of another brand. More than half (53%) said it was, and GM took the most sales from Ford Motor Co. (NYSE: F). Some 32% of the GM buyers switched from Ford to GM cars. That’s about 18,650 fewer Ford cars sold in the three-month period. Toyota Motor Corp. (NYSE: TM) and Honda Motor Co. Ltd. (NYSE: HMC) lost 14% and 7% of sales, respectively.If Costco sold nothing but cars it would be the largest new car dealer in the United States. In 2015, the company sold more than 465,000 vehicles. AutoNation Inc. (NYSE: AN) is the nation’s largest car dealer, and it sold 343,753 new vehicles in 2015, a 5% increase year over year. Costco’s year-over-year increase in new vehicle sales totaled 16.8%.

Written by Paul Ausick of 24/7 Wall Street

(Source: 24/7 Wall Street)

How Driverless Cars Could Kill the Speeding Ticket — and Rob Your City

Provided by David Paul Morris/Bloomberg

One of the big benefits of driverless cars is that they aim to promote safety on the roads while reducing congestion at the same time. If cars are largely run by computers, talking to each other, they can travel closer together in a more coordinated fashion without fear of causing a fender-bender.

Those machines could obviously malfunction. But on the whole, driverless cars are known to behave more cautiously than their human operators. And by virtue of their, well, virtues, autonomous vehicles won’t know how to speed, run red lights, park illegally or make other traffic violations that would result in a ticket. And that could drive some city budgets into a deep hole.

Take the nation’s capital, which operates the most speeding and red-light cameras of any city in the country. In 2014, the District issued an average of 773 tickets a day from its speeding cameras alone — adding up to roughly $37.5 million worth of fines, according to the latest figures from AAA Mid-Atlantic. Since 2007, speed cameras have been a cash cow for the city’s police, resulting in nearly $357 million in revenue, AAA said.

Last year the city pulled in less money from parking tickets, partly due to new, smartphone-compatible parking meters that allow drivers to keep track of their status online. And driverless cars will only accelerate that trend, said John Townsend, a spokesman for AAA Mid-Atlantic.

“If you have one of these vehicles, your propensity for getting a speeding ticket or red-light camera ticket will be greatly  diminished,” said Townsend. “It’ll be another step in the long progression of technology and how it is changing the outcome in the number of people who get tickets.”

Washington isn’t the only city that reaps financial rewards from ticketing drivers. Chicago is looking at more than $1 billion alone in outstanding parking tickets, speeding tickets and red-light violations. New York drivers owe the mayor some $756 million, while the city of Los Angeles is owed $285 million, according to a Freedom of Information Act request by the local news site DNAinfo.

The scale of the problem balloons in some smaller municipalities. That’s because these jurisdictions may lack other meaningful sources of revenue. The town of Mountain View, Colo., made up 53 percent of its budget with tickets in 2013. Mountain View is a bit of an outlier — tickets account for less than 4 percent of the budget in many other Colorado towns — but it’s hardly unique in its approach to budgeting. In Waldo, Fla., (population 1,015) tickets written by its seven police officers are said to account for half of the town’s revenueand nearly two-thirds of the police department’s budget.

James Tignanelli is president of the Police Officers’ Association of Michigan. He says police officers in many jurisdictions are being ordered to write tickets, sometimes despite their vocal objections.

“We’re the only revenue producers in town, once you get past the  water department,” said Tignanelli. “That’s how it is here, anyway.”

Driverless cars hold some important potential cost-savings for cities, too. Fewer accidents means cities can spend less responding to incidents. And police officers normally detailed to guide traffic or patrol for speeders could productively be deployed elsewhere. Of course, added Tignanelli, if driverless cars seriously start depriving city coffers of ticket revenue, it will likely prompt top officials to pressure police into whipping up new fees and fines.

“It’d be dog licenses, or bike licenses — there’s always something,” he said.

Or it could mean a new tax. Driverless cars, with all their newfangled gadgetry, can easily log the miles they travel and report that information. Some policymakers, such as former Transportation Secretary Ray LaHood, have expressed support for a vehicle-miles traveled tax that would charge drivers a certain amount per mile. Advocates say it’s a more representative way of determining a driver’s responsibility for infrastructure upkeep compared to the current approach of relying on gas taxes, particularly as hybrid vehicles allow drivers to use the roads more heavily while paying the same amount in taxes as other drivers.

Implementing such a proposal is sure to be politically complex — which just underscores the potential rat’s nest of a budgeting challenge that driverless cars are poised to create.

Written by Brian Fung of The Washington Post

(Source: The Washington Post)

This is a Big Problem for the Auto Industry, and it’s Getting Worse

iStockphoto

Car dealers may be coming off of their biggest sales year ever, but the future for the auto industry looks murkier as the percentage of Americans with a driver’s license continues to fall.

Just 77 percent of Americans aged 16 to 44 held drivers licenses in 2014, down from 82 percent in 2008 and 92 percent in 1983. The percentage of Americans with driver’s licenses declined across every age group from 2011 to 2014,according to an analysis by Michael Sivak and Brandon Schoettle at the University of Michigan Transportation Research Institute.

Several factors have led to fewer licensed drivers, including a lack of interest among younger consumers in driving or owning a car, a general return to cities and close suburbs with reliable public transportation, a rise in telecommuting, and the advent of ride-sharing services like ZipCar and on-demand taxis like Uber. Tighter restrictions on young drivers haven’t helped either.

The introduction of driverless cars, which some industry experts say will be on roads within the next decade, promises to further reduce the share of Americans who feel the need to get a driver’s license.

The result of fewer licensed driver is that the aggregate number of miles driven has plateaued over the past decade, according to research from the Brookings Institute.

That may be bad news for automakers and the gasoline industry, but it’s good news for drivers themselves. The 2015 Urban Mobility Scorecard from the Texas A&M Transportation Institute found that drivers wasted more than 3 billion gallons of fuel and spent 7 billion extra hours sitting in traffic last year, at a cost of $160 billion, or $960 per commuter.

Written by Beth Braverman of Fiscal Times

(Source: The Fiscal Times)

U.S. Approves 2016 BMW Diesel X5 SUV After EPA Review

File photo of a BMW emblem at the 2015 New York International Auto Show
REUTERS/Eric Thayer/Files

The Environmental Protection Agency and California Air Resources Board approved the sale of the new 2016 BMW diesel X5 after government testing found no evidence of software to evade emissions standards, the government said Thursday.

In September, U.S. environmental regulators and Transport Canada announced they would review all current diesel passenger cars, trucks and SUVs for sale to ensure that they did not have “defeat devices.”

EPA spokeswoman Laura Allen said Thursday that the agency – along with California and Canada – was doing additional testing before approving new diesel vehicles. “Our screening tests found no evidence of a defeat device in the 2016 BMW X5,” she said.

BMW said late Thursday it had delayed the start of production of the diesel X5 – known as the X5 xDrive35d – until EPA testing and certification were completed.

“The vehicle will be going into production shortly at our manufacturing plant in Spartanburg, South Carolina,” BMW said. It expects the vehicle will go on sale in January.

The EPA diesel review came weeks after Volkswagen AG admitted it installed software in 482,000 U.S. vehicles that allowed vehicles to emit up to 40 times allowable pollution in real world driving. VW says the issue involved up to 11 million vehicles worldwide.

Last month the EPA approved the sale of two new General Motors diesel pickup trucks – the 2016 GMC Canyon and 2016 Chevrolet Colorado – after finding no improper emissions.

The BMW SUV and GM pickups were the only non-VW 2016 diesel vehicles awaiting certification.

BMW says diesels accounted for 5.9 percent, or 20,178, of 2014 U.S. vehicle sales.

In November, VW and its Audi and Porsche units acknowledged it has other emissions issues in larger luxury vehicles that extend to an additional 85,000 vehicles dating back to 2009.

The EPA and California on Nov. 2 accused VW of evading emissions in at least 10,000 Audi, Porsche and VW sport utility vehicles and cars with 3.0-liter V-6 diesel engines. VW initially denied the findings.

Last month, VW and Audi officials acknowledged emissions issues in all vehicles with 3.0-liter diesel engines from model years 2009 through 2016.

VW, Porsche and Audi have issued stop sales for 2015 and 2016 diesel models in showrooms and certified used diesel vehicles. The EPA declined to approve the sale of 2016 diesel vehicles, and VW withdrew its certification request for the cars in October pending further talks with regulators.

Written by David Shepardson of Reuters

(Source: MSN)

China Forecast to Become World’s Biggest Electric Car Market

An employee assembles an electric car along a production line at a factory in Qingzhou
REUTERS/China

China is forecast to become the world’s biggest electric car market this year, with sales estimated at 220,000 to 250,000 vehicles, the official news agency Xinhua said on Sunday, quoting the China Association of Automobile Manufacturers.

Worldwide electric cars sales are expected to increase to 600,000 this year, association deputy secretary-general Xu Yanhua told an industry conference.

China is tipped to surpass the United States as the world’s biggest electric car market, she said, putting the U.S. market at an estimated 180,000 vehicles.

China’s electric-car industry is developing rapidly, but quality and not just quantity should be the focus for the development to be sustainable, Xu said.

Safety and the quality of batteries should be carefully supervised, she added.

The industry saw explosive growth in the past two years, thanks to supportive government policies, including subsidies and tax cuts.

In the first 10 months of this year, sales of electric cars surged 290 percent year-on-year to 171,145, according to the association’s data.

Written by Reuters

(Source: Reuters)

The Average Tesla Driver Isn’t Who You’d Expect

© Ann Hermes/The Christian Science Monitor/Getty Images
© Ann Hermes/The Christian Science Monitor/Getty Images

Not everyone behind the wheel of a Tesla Motors car is a millionaire. And that’s a good thing, according to a Jefferies research report by Dan Dolev.

After surveying 145 Tesla owners, Dolev and his team found that against popular wisdom Tesla owners are not just for luxury car drivers, indicating the company’s attempts at making its cars accessible to everyone are working.

“Survey responses yielded some surprising results: most notably that Tesla owners are not a homogenous group in the market for luxury cars, but rather that they come from a wide variety of previous makes/models,” Dolev wrote. The analyst raised his price target to $360 from $350, but kept his “buy” rating on shares.

Because of its higher brand value and drivers willingness to switch to Tesla, Dolev increased 2020 production estimates to 515,000 cars, up from a prior outlook of 500,000. He also slightly raised 2016 and 2017 revenue estimates, forecasting $9.27 billion and $12.84 billion, up from $9.269 billion and $12.827 billion, respectively.

In 2014, deliveries of the Model S vehicles increased to 31,655 from 22,477 in 2013, according to company filings. Total revenues for company also increased to $3.2 billion, up from $2 billion. In its first-quarter earnings report, Tesla reported generating $940 million in total revenues, up from $621 million in the same quarter the previous year.

Shares of Tesla were higher in pre-market trading, gaining 0.5% to trade at $266.50.

Tesla owners surveyed reported to previously driving cars ranging in price from $15,000 to $250,000, including everything from a Toyota Highlander to a Acura MDX and Porsche 911/918. After averaging national pricing data, the report said owners paid an approximately 80% premium on their Tesla cars compared to the average selling price of their previous cars.

Of the respondents, 25% said they were not considering any other brands besides Tesla, and 85% of owners said that their next car would most likely also be a Tesla. Yet another strong indicator of customer loyalty was that 89% of surveyed owners said they would still buy a Tesla even if the current $7,500 federal tax credit were taken away.

The results also showed that if drivers had not purchased a Tesla some would have rejected going the luxury car route and instead bought a car with an average selling price as low as $30,000, once again indicating the high premium drivers give Tesla. Of those surveyed only 13% of respondents said they would have purchased a vehicle with an average selling price higher than the Tesla Model S, which begins at $57,500 for the 70D version.

Cars viewed as a suitable substitute for Tesla have an average selling price of $78,000, which means there is a 29% premium for Tesla cars.

The release of the Tesla Model 3 in 2017 will also help Tesla reach a wider audience base since it is estimated to have a lower average selling price of $55,000, according to Dolev.

Written by Meg Garner of The Street

(Source: The Street)

These 2 Industries are Bullish for the U.S. Economy

Provided by Getty Images
Provided by Getty Images

With all the hand-wringing about how weak this economic recovery has been, with the second-quarter GDP growth rate of 2.3% being hailed as a triumph, the U.S. consumer economy has quietly emerged as a real source of strength.

Automotive and housing sales have once again begun to fulfill their traditional role as twin pillars of an economic recovery. And, unlike a few years ago, average middle-class people, not just the wealthy, are buying.

Even millennials, those supposed denizens of Uber, rentals and their parents’ basements, are starting to loosen their purse strings to pursue these two key components of the American Dream.

“I don’t see anything in the immediate horizon that will derail this,” said Charles Chesbrough, senior principal economist with IHS Automotive, an analytical and consulting service based in Northfield, Mich.

He’s particularly impressed with July auto sales. General Motors reported a 6.4% year-over-year increase in U.S. retail sales, and Fiat Chrysler Automobiles and Ford Motor were only slightly behind. Nissan Motor and Honda Motor did even better.

And the hottest vehicles were some of the priciest: crossovers, SUVs and pickup trucks. Luxury marques like Lexus and Infiniti also outperformed. That means higher average prices and fatter profits for car companies.

But it also means car buyers are letting it rip, which Chesbrough attributed to lower gasoline prices and more appealing products.

As crude prices drop again amid oversupply, weak demand from emerging markets and the winding down of the summer driving season, Chesbrough estimates the average U.S. household is saving $800 to $900 a year at the pump.

“They’re using those savings from the low gas prices and they’re buying big cars, pickup trucks, SUVs,” he added.

And not just basic models. Instead, “they’re loading them up” with extras, technology and navigation packages, what have you. “Consumers really want new technology,” he said.

Also, some loosening of credit standards has broadened demand beyond the affluent. “Now it’s all buyers who are getting into the market,” he said.

Chesbrough projects 17.1 million vehicles will be sold in the U.S. this year, the most since before the financial crisis, and “by next year, we may reach a new, all-time high” above 2000’s 17.4 million record.

Housing sales are a long way from their bubble peak in 2006, when 2.1 million new and existing homes changed hands. But the recovery has been striking. Some markets that had been left for dead have come roaring back, with enormous price gains as vulture investors bought foreclosed homes in bulk.

Lately, price increases in those former boom towns have moderated, said Svenja Gudell, senior director of economic research at Seattle-based real estate marketplace Zillow.

“I think overall the recovery in housing is continuing, but we are starting to go back to more normal rates of appreciation,” she said.

Still, recent data have been strong:

Existing-home sales jumped 3.2% in June to an annual rate of 5.49 million, the highest since 2007.

New-home sales soared 18% in June, although new construction simply hasn’t recovered from the housing bust.

The Standard & Poor’s/Case-Shiller 20-city index of home prices rose 4.9% year-over-year in May.

Gudell said price increases are heavily concentrated in strong markets like San Francisco, Miami and Denver. Overall, she sees the base of buyers broadening beyond the affluent to the middle class.

“The low end is starting to pick up, but … unfortunately, conditions are extremely competitive” amid low inventory, bidding wars and all-cash sales in some markets.

Despite some short-term obstacles in both housing and cars, there’s plenty of pent-up demand.

IHS Automotive estimates that Americans have owned their vehicles for an average of 11.5 years. Sure, they’re made a lot better now, but that’s a record.

And a survey by Zillow in January found 5.2 million renters expect to buy homes this year.

Millennials, who have faced more financial constraints than previous generations, nonetheless are starting to buy cars and homes.

“One of the largest groups of new homeowners will be millennials,” said Gudell, adding that they’re buying in their 30s instead of their late 20s. Added Chesbrough: “Millennials have been coming back to the [auto] market,” although student debt may reduce their purchasing power, he cautioned.

Both see the dangers from higher interest rates, which Chesbrough calls “the one thing we know that’s coming down the pike that could have a negative impact on consumers.”

But “it’s not like rates are going to shoot up tremendously,” said Gudell. Federal Reserve Chairwoman Janet Yellen has repeatedly said that the Fed would raise rates gradually, and they likely wouldn’t go as high as they have in the past.

So, as the broad middle class and especially millennials start buying houses and cars again, this recovery could last longer than many think, and keep this bull market running well past its sell-by date too.

Written by Howard Gold of MarketWatch

(Source: MarketWatch)