We Lose by Waiting on Autonomous Cars

Autonomous cars represent one of the most exciting and promising technologies in the history of the automotive industry. And yet auto executives seem to be far more worried about the liability they face than in bringing this life-saving technology to market. We have a serious disconnect here.

The Centers for Disease Control and Prevention says 1.3 million people are killed in motor-vehicle accidents globally. It estimates 30 million to 50 million injuries. And it projects this costs society over $100 billion every year.

Safety experts know human error causes more than 90% of all traffic accidents. With computers and sensors doing the driving, that means self-driving cars could eliminate most of those crashes. And yet, the auto industry is wringing its hands, trying to figure out who will be held legally responsible if autonomous cars get in a crash.

And they will crash. No matter how carefully they are designed and built, a few will fail and people will die or get injured. That, of course, will trigger lawsuits against automakers and their suppliers, especially in the United States.

But so what? Automakers get sued all the time. There’s nothing new in that. That’s why they all have armies of lawyers on staff, pay big fees to retain outside counsel and budget for this every year. Let me say that again: They budget for this.

Back when airbags started being installed as standard equipment in the late 1980s, supplier TRW jumped into the business. Knowing full well it would get sued at some point, TRW put $1 in the “kitty” for every airbag it made. That became its legal war chest to litigate those lawsuits. What a simple solution that could be adopted for autonomous cars.

There’s a related precedent that suggests how liability will be determined. Back when event data recorders, commonly called black boxes, began to appear in cars, there were loud protests over privacy rights and who “owned” the data in the black box. Was it the manufacturer that built the car? Was it the owner of the car? Or if the car was leased, was it the leasing company because it legally owned the car?

Insurance companies were particularly keen to get their hands on that information because the black box would record whether the driver was speeding, had applied the brakes, tried to swerve or even whether he or she was wearing a seatbelt.

It took a couple of years of litigation, but in the U.S., the courts ruled the owner or lessee owned the data. And if insurance companies or automakers wanted to get their hands on that data, they had to get the police to start an investigation and the police had to obtain a search warrant from a judge to get the data out of the box. The point is, the courts determined this in fairly short order, and the same likely will happen in sorting out liability for autonomous cars.

Meanwhile, automakers are waiting for someone to tell them who will be held liable if a self-driving car crashes. Well, I can tell them the answer right now: They will be held liable. So they should stop standing around and start figuring out how to deal with it.

The danger, of course, is that Silicon Valley companies such as Google and Apple will jump in to fill the void while the traditional OEMs dawdle. And once the tech companies get a beachhead in this business, watch out! Their business plans are all about technological disruption and market domination.

The first fully autonomous cars are expected to appear around 2020. That means in the next five years there will be 6 million traffic fatalities, 250 million injuries and a cost to society of half a trillion dollars. 

That’s why I’m tired of hearing all this talk about liability. We lose by waiting.