The United States Autonomous Cars Market is estimated to be valued at USD 14.79 Bn in 2024 and is expected to reach USD 37.56 Bn by 2031, growing at a CAGR of 20.5% from 2024 to 2031.

The autonomous cars market in the United States is expected to witness significant growth driven by various trends. Research shows that millennials are more willing to use self-driving vehicles as they are more comfortable with new technologies.

Market Driver – Technological Advancements

Technological advancements are significantly driving the growth of autonomous cars market in the United States. Developments in technologies like artificial intelligence, machine learning, sensors and mobile connectivity are enabling self-driving capabilities in vehicles. Cars are increasingly being equipped with advanced driver assistance systems like adaptive cruise control, blind spot monitoring and automatic emergency braking. Major automakers like Tesla, GM and Ford have also introduced vehicles with SAE Level 2 and Level 3 autonomous capabilities for highway driving and parking.

The advancements are attracting huge investments in research and development from automakers as well as technology companies. For example, Tesla invested over $2 billion in R&D in 2021 alone to develop fully autonomous driving systems through its custom AI chip and neural networks. Startups like Cruise, Waymo and Argo AI are also testing autonomous vehicles without drivers on public roads in several US states. They have collected massive amounts of real-world driving data to continuously improve the capabilities of their self-driving systems. The testing is helping identify and address remaining challenges to achieve true driverless capabilities without any human intervention.

Market Driver – Regulatory Support and Legislation

Regulatory support and legislation are major drivers for the growth of autonomous cars market in the United States. With advances in autonomous driving technology, several states have proactively introduced new legislation to test and operate driverless vehicles on public roads. For example, California was the first U.S. state to introduce autonomous vehicle regulations in 2014. It has permitted companies like Waymo, Cruise and Moton to test fully driverless cars without backup drivers. Several other states like Texas, Florida, Pennsylvania, Michigan, Washington and Nevada have also passed new laws that removed previous legal barriers and allowed on-road testing and operation of autonomous vehicles without human drivers under certain conditions.

The federal government also supports research and development of autonomous cars. In 2016, the U.S. Department of Transportation released new federal guidance and 37 safety design elements for autonomous vehicles. This established a framework for testing and deployment of autonomous technology. The DOT has also invested over $100 million in mobility on demand sandbox pilot projects across several U.S. cities to test autonomous shuttles. The Bipartisan Infrastructure Deal passed by Congress in 2021 includes $7.5 billion to support electric vehicle infrastructure and $7.5 billion for a new program to fund alternative fuel corridors across the nation.

Market Challenge – Safety and Liability Concerns

Safety and liability concerns continue to significantly restrain the growth of the autonomous vehicle market in the United States. There are major uncertainties around how to address the legal and policy issues that emerge when taking human drivers out of the driving task. Without clear federal standards and regulations on the testing and deployment of self-driving cars, consumers remain hesitant to adopt this new technology due to uncertainty over how safety will be ensured.

Additionally, it is unclear who will be at fault in the event of an accident involving an autonomous vehicle - the passenger, the manufacturer, or the software developer. Automakers and technology companies are concerned about taking full liability, especially in the early stages of the technology before the root causes of potential issues are fully understood. The lack of consensus on issues around legal liability and insurance has discouraged significant investment in research and development by automakers. Without agreement on regulatory frameworks to address these challenges, widespread commercialization of autonomous vehicles faces delays.

Market Opportunity – Growth in Mobility-as-a-Service

Growth in Mobility-as-a-Service could offer great opportunities in the United States autonomous cars market. With Mobility-as-a-Service (MaaS), individuals can purchase access to different means of transport via an application on their smartphones. Users will have the freedom to choose from a variety of autonomous vehicle options for their transportation needs, whether it's using self-driving taxis, buses or renting a vehicle, all through a single platform. This will help reduce dependency on personal vehicles and promote shared and sustainable transportation solutions.

MaaS is expected to revolutionize personal transportation by shifting the focus from vehicle ownership to mobility usage. This change will encourage more people to use autonomous vehicles as their preferred mode of transport. With MaaS platforms integrating various transport options, users will have a convenient "one-stop-shop" to fulfill their diverse mobility requirements. It will make transportation more affordable, accessible and economical compared to maintaining a personal vehicle. Issues like parking spaces and traffic congestion caused by privately owned vehicles are also expected to decrease with higher adoption of MaaS and autonomous fleets.

Data from the U.S. Department of Transportation shows that transportation is currently the second largest household expense after housing.

Insights, By Vehicle Type: Increasing Consumer Demand for Self-Driving Capabilities

In terms of vehicle type, passenger cars contribute the highest share of 59.8% in the market owing to increasing consumer demand for self-driving capabilities. As the technology advances to make autonomous driving safer and more seamless, individual consumers are exhibiting greater interest for self-driving features in their daily commutes. The average time spent in vehicles has also increased substantially over the past decade, making autonomous driving appealing for reducing driver fatigue or stress.

In addition, an aging population is growing more reliant on autonomous vehicles to provide independence and mobility. Demand is particularly strong among suburban areas with higher vehicle ownership but limited public transportation options. Many passengers also value the ability to be productive or entertained during otherwise idle driving time. Technology companies and automakers have recognized this consumer appetite for autonomy in personal vehicles and are aggressively developing advanced driver assistance systems and higher levels of self-driving capabilities tailored for passenger vehicles. As the costs come down due to economies of scale, further adoption should take off in the coming years.

Insights, By Level of Autonomy: Level 2 Autonomous Vehicles Dominate Current Adoption

Among the different levels of autonomy, Level 2 vehicles currently contribute the highest share of 29.18% sales. At this stage, an automated system can actually conduct some parts of the driving task, such as accelerating, braking, or steering, under certain circumstances. However, the human driver must remain fully engaged and ready to retake control at any time. This semi-autonomous set-up appeals to both automakers and consumers as a middle ground - automakers can offer some self-driving benefits today while avoiding the greater costs and challenges of developing true self-driving vehicles. At the same time, consumers gain early access to autonomous features while maintaining traditional control and responsibility.

Many new vehicle models now offer optional Level 2 systems that manage steering and speed on the highway under ordinary traffic conditions. As drivers experience the convenience of Level 2 driving aids, demand should create a positive feedback loop to further improve and standardize these semi-autonomous controls. Over time, automated systems are expected to take over more driving tasks and push the overall market toward higher levels of autonomy. But for now, Level 2 remains the technological frontier achieving the most widespread commercial use.

The major players operating in the United States Autonomous Cars Market include Tesla Inc., General Motors, Ford , Waymo , Aurora, Uber Advanced Technologies Group, Aptiv, Lyft, Nuro, and TuSimple.

• On April 19, 2024, Mercedes became the first carmaker to sell self-driving cars in the U.S. without requiring drivers to watch the road.
• On January 17, 2024, German startup Vay introduced its ‘teledriving’ solution in the U.S. for the first time. This move puts Vay in direct competition with well-funded American companies in the mobility technology sector.

• By Vehicle Type
  • Passenger Cars
  • Commercial Vehicles
  • Special Purpose Vehicles
• By Level of Autonomy
  • Level 1
  • Level 2
  • Level 3
  • Level 4
  • Level 5
• By Application
  • Transportation and Logistics
  • Military and Defense
  • Agriculture
  • Manufacturing
  • Healthcare
  • Others
• By Component
  • Hardware
    • LiDAR
      • Radar
      • Cameras
      • Ultrasonic Sensors
      • Others
    • Software