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It’s just human nature…
The human tendency to underestimate or even completely dismiss something – because it falls outside of our own personal experiences – is just human nature.
It’s called normalcy bias…
It’s partly why I put so much time, effort, and expense into producing The Bleeding Edge every day… so that I can show you, my reader, what’s really going on out there, outside of our narrow experiences – and why it’s important from an investment perspective, or even for our future well-being.
And no better example of the normalcy bias can be found… than that with self-driving technology.
Alphabet’s (GOOGL) Waymo division just published an update on its autonomous ride-hailing service. Most will probably find it quite surprising.
To date, Waymo has provided more than 10 million autonomous rides in geofenced areas in Los Angeles, Phoenix, San Francisco, Atlanta, and Austin.
That amounts to roughly 96 million “rider-only” miles driven (i.e., without a safety driver behind the wheel).
Here is the following breakdown [Note: Atlanta was recently launched, so no numbers to report yet]:
These are impressive numbers, especially when we consider that Waymo has to drive every road and map it – down to millimeter precision – wherever it wants to operate.
It is incredibly time-consuming and labor-intensive, and it doesn’t scale well. That’s why operating areas are geofenced, and we don’t yet see Waymo everywhere.
Atlanta just recently launched this summer, and Miami and Washington, D.C., are up next.
Aside from the incredible numbers about rides and miles driven, some very useful data have emerged regarding Waymo’s safety statistics compared to the average statistics with human drivers. I think you’ll find the numbers surprising…
Source: Waymo
Waymo has demonstrated a 91% overall reduction in crashes that cause serious injury or death, 92% fewer crashes with pedestrians that cause injuries, and 89% fewer crashes with motorcycles compared to the averages for human drivers.
I often say that for a technology to see rapid adoption, the percentage improvement can’t be just 10% or 15% better than what exists. That’s just not large enough to drive a major disruption and incentivize businesses and consumers to make a change.
These safety numbers are stunning in a positive way. They demonstrate a radical improvement in safety on all accounts.
Even when we look at every possible type of crash (shown below) – like a crash in an intersection, a lateral crash, or one with a cyclist – on all accounts, Waymo’s autonomous technology is remarkably safer than the average human driver.
Source: Waymo
It’s hard not to be excited about this technology. After all, more than 1 million people die every year globally from car crashes, more than 40,000 of which happen in the U.S.
This technology saves lives. And the numbers from both Waymo and Tesla – which I have shared many times in The Bleeding Edge – definitively prove it.
Which is why, earlier this month, U.S. Transportation Secretary Sean Duffy made a major announcement that the National Highway Traffic Safety Administration (NHTSA) is updating the rules for the Federal Motor Vehicle Safety Standards (FMVSS) for vehicles with autonomous driving systems (ADS).
It was the kind of announcement that most wouldn’t have thought twice about. And unless you’re watching these developments very closely, you wouldn’t think much of it at all.
But we should, as there are incredible implications.
Duffy said:
The rules of the road need to be updated to fit the realities of the 21st century. Our changes will eliminate redundant requirements and bring us closer to a single national standard that spurs innovation and prioritizes safety.
He went further to clarify:
The new [automated vehicle] framework will unleash American ingenuity, maintain key safety standards, and prevent a harmful patchwork of state laws and regulations.
There is a clear acknowledgement that current regulations, which are decades old, are written for vehicles with human drivers, and therefore need to be updated for autonomous driving systems.
For example, Duffy announced that changes will be made to the following standards to accommodate autonomous vehicles:
It may feel weird, but the reality is that we don’t need a steering wheel, a brake pedal, a clutch pedal, or an accelerator pedal in an autonomous car.
If we think about it, we don’t even need a windshield wiper, because we’re not driving the car.
This is a massive shift by the NHTSA to remove both the state-by-state approach to transportation standards and to be prescriptive about exactly what kind of hardware is needed in autonomous vehicles.
Additionally, an even bigger change comes with the following comment…
Manufacturers must demonstrate that their vehicles provide an equivalent safety level to compliant vehicles and that the exemption is in the public interest.
Translated, this means that the NHTSA will be adopting performance-based standards, not prescribing technological standards.
If you haven’t figured it out yet, this is fantastic news for Tesla (TSLA).
If you’ve been wondering why Tesla is approaching all-time highs right now, this is why…
One-Year Stock Chart of Tesla (TSLA)
Many in the industry were trying to push LIDAR requirements on the NHTSA in an effort to box Tesla out of the industry. These were just competitive dynamics at play, trying to remove the largest competitive threat from the industry. And it didn’t work.
Performance and demonstrated safety statistics are all that matter.
Tesla is already operating full self-driving (FSD) in six countries right now: the U.S., Canada, China, Mexico, Australia, and New Zealand. And FSD is now being tested in Japan.
Better yet, Elon Musk announced last month that the next version of FSD, version 14, was trained on 10X the number of parameters and will likely be ready by the end of this month. Musk went so far as to say that the new version of FSD “feels alive” and that it will “substantially reduce the need for driver attention.”
Are you excited yet? I know I am…
Better yet, Teslas have now driven somewhere between 5.2 billion and 6 billion miles on full self-driving. And Tesla has the same kind of safety statistics as Waymo does, just more than 50x more miles driven than Waymo, with no geofencing.
Get ready for a whole lot more of these in the months ahead…
Source: Tesla
And when that happens, get ready to ride and realize a new normal…
Sit back, relax, and enjoy being driven.
Feel alive,
Jeff
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
