Several people tell Insider that autonomous cars pose a huge threat to outdoor advertising companies because people driving autonomous cars will not look out the window at billboards.  Will autonomous cars change things?  Yes.  Is the sky falling? No.   Today Insider will discuss some of the challenges autonomous cars face.  On Thursday Insider will discuss how autonomous cars might impact out of home advertising and what you can do about it.

Gartner has developed a hype cycle for emerging technologies.  After it has been developed a new technology goes through a period of inflated expectations (this is amazing and will change everything), then a trough of disillusionment (it’s too complicated, it’s too expensive) before rising back up the slope of enlightenment (an effective business model emerges) to a plateau of productivity in which a product is adopted in the mainstream.  Insider has reproduced Gartner’s 2016 hype cycle for emerging technologies below.    Autonomous cars are sliding into the trough of disillusionment:

Why are autonomous cars overhyped?

• Tech bugs.  Tesla drivers in China and the US were killed when autopiloted Teslas crashed into trucks.  Uber autonomous cars have been running red lights and have trouble recognizing bike lanes.  Check out the video below.

• Cost. Tesla’s autonomous car technology adds $10,000 to the cost of a car.  Google’s autonomous technology adds $80,000 to the cost of a car.  The average new car costs $35,000.  Insider expects there will be resistance to autonomous car technology if it increases the price of a new car from $35,000 to $45,000-115,000.  Hybrid cars are being produced but are only a 5% of all new car sales, primarily due to the upfront cost.  Insider expects cost to slow down the adoption of autonomous cars as well.

• Scaling production.  20 companies are trying to produce autonomous cars.  Most of the reports are that it will be 4-6 years before they will overcome regulatory and production.

• Vehicle Turnover.  There are 274 million cars in the US.  17 million new cars were sold last year.  If 100% of all new car sales are autonomous (not going to happen) it will take 17 years for the stock of existing cars to go autonomous.    Add on 5 years for production problems to be solved and there’s a 22 year adoption timeframe.   The sky is not falling.

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