Netherlands tops KPMG’s AV readiness index; US third
Autonomous vehicles have taken the world by storm and the pace of development of AVs has been tremendous. It’s no more a question on whether autonomous vehicles will be reality but when all road vehicles become fully autonomous. A first ever survey by KPMG attempts to rank 20 autonomous vehicle ready countries. While the Netherlands emerged the leader in this Autonomous Vehicles Readiness Index due to its excellent road infrastructure, a highly supportive government and enthusiastic adoption of electric vehicles, Singapore tripped United States to rank second largely owing to the amendment to its Road Traffic Act allowing self-driving vehicles to be tested on public roads. US emerged third despite having the most innovations in this field, while Sweden and United Kingdom completed the top five.
Among the other top 10 countries, Germany and Canada at 6th and 7th spot were obvious choices, but UAE, New Zeaoand and South Korea taking the next spots, ahead of Japan (11th), surely would surprise many. Austria (12th), France (13th), Australia (14th) and Spain (15th) make up the next top five. China at 16th is again a surpise, while the next four places are taken by Brazil (17th), Russia (18th), Mexico (19th) and India (20th).
1. The Netherlands
The Netherlands emerged as the clear leader — it is within the top four of each of the four pillars and ranked number one on infrastructure, largely because of its well-maintained road network which is rated as being among the world’s best by the World Economic Forum and the World Bank. It also has by far the highest density of electrical vehicle charging points, more than Japan’s. The country comes second only to Singapore in consumer acceptance, and is the highest of the 20 in WEF’s technology readiness rating, among the highest in KPMG’s assessment of societal change readiness.
Even though the consumer survey data found that the Dutch are less accepting of AV technology than most other countries, KPMG was quick point out that this may reflect citizens relative satisfaction at the existing state of transport.
On policy and legislation, the Netherlands received the maximum score for regulations and government investment in AV infrastructure. On technology and innovation, the country has by far the highest percentage usage of electric vehicles of the 20 countries in this index at present — 6.39% in 2016, nearly double the second-placed Sweden — and has a high number of AV companies based in the country on a population-adjusted basis.
As Stijn de Groen, Manager, Digital Advisory KPMG in the Netherlands, explained: “The Dutch ecosystem for AVs is ready. The intensively-used Dutch roads are very well developed and maintained and other indicators like telecoms infrastructure are also very strong. In addition, the Dutch government Ministry of Infrastructure has opened the public roads to largescale tests with selfdriving passenger cars and lorries.”
Singapore topped on policy and legislation and consumer acceptance pillars, and emerged second only to the Netherlands on infrastructure. KPMG says Singapore received the maximum score on regulation, with a 2017 amendment to its Road Traffic Act allowing self-driving vehicles to be tested on public roads, and a single entity to coordinate AV work.
Citizens here are more open to the technology than many other countries. The country’s strong scores for infrastructure, including very high road and mobile network quality, are only undermined by a low density of charging stations for electric vehicles. Singapore fails to attain the top spot because of its average performance on technology and innovation. It lacks technology company headquarters, patents or investment and has a low use of electric cars.
3. United States
The US leads on AV innovations. With its 163-company headquarters, it ranked at the top of the technology and innovation pillar. Germany, which is at second spot on this pillar, has just 22. US scores maximum or near-maximum ratings on industry partnerships, research and development hubs, AV technology company headquarters, investment, and WEF ratings for technology availability and capacity for innovation.
Companies including the Detroit-based ‘Big 3’ auto-makers, other automotive companies, ridesharing companies such as Uber and Lyft and intermodal innovators like Hyperloop are all involved in research. So are companies from other countries, with Japan’s Toyota basing a $1billion research hub in Michigan and using a testing proving ground in California.
However, it has poor scores on patents and low usage of electric cars — currently 0.92%. The driving public is generally aware that AVs are being tested at numerous sites across the country, but little is clearly understood with regard to the actual capabilities of early vehicles or the timing for adoption.
US has good score on consumer acceptance, boosted by strong ratings from KPMG’s Change Readiness Index and the WEF, but is undermined by low levels of acceptance of AV technology by consumers and the fact that despite its 23 test locations being the largest number of any country, only a small proportion of Americans live in them.
On infrastructure, the US has relatively few electric vehicle-charging stations given the large size of its road network, and a poorer road quality and infrastructure than either the Netherlands or Singapore, although it does well on 4G network coverage. On policy and legislation, the US gains average scores for specific regulations and government investment in AV, and a low rating from the WEF for effectiveness of its law-making.
According to Timothy D. Wilschetz Principal, Infrastructure Advisory, KPMG in the US, “The US has a highly innovative but largely disparate environment with little predictability regarding the uniform adoption of national standards for AVs. Therefore, the prospect of widespread driverless vehicles is unlikely in the near future. However, federal policy and regulatory guidance could certainly accelerate early adoption, particularly concerning limited freight applications such as truck platooning.”
Sweden has the almost the same overall score as the US and ranks between second and eighth across the pillars. It is strongest in the technology and innovation pillar, where it has the highest per capita number of AV company headquarters, a strong showing on per capita AV investments and one of the highest ratings from the WEF for availability of the latest technology.
Though the country also has the second-highest electric car share of the 20 countries, at 3.41%, it scores low on industry partnerships, R&D hubs and patents. On policy and legislation, Sweden has one of the highest government capability scores from KPMG’s Change Readiness Index research, but lower ratings on AV-specific areas. However, in 2015, the Swedish government initiated a proposal to regulate trials of self-driving vehicles, concluding that it’s possible to carry out trials at all levels of automation on Swedish roads. As a result, the Road Transportation Authority can, as of July 2017, authorize permits and supervise trials in accordance with the new law
5. United Kingdom
UK rates in the top five for three pillars, but 10th on infrastructure. On technology and innovation, the country has good scores on industry partnerships and research and development hubs, as well as high ratings from the WEF on both technology availability and capacity for innovation, although it has fewer AV patents than other leading nations. It has among the highest ratings from KPMG’s Change Readiness Index and the WEF on consumer acceptance, although lower ratings for the proportion of people living in test areas.
The UK is near the top in policy and legislation, with the Department for Transport having determined that it is legal for driverless cars to operate on any public roads without permits or extra insurance19 and the establishment of a Centre for Connected and Autonomous Vehicles.
Its rating across this pillar is lowered by fewer government-funded AV pilots and a lower rating on government capability in KPMG’s Change Readiness Index research. Its mid-table performance on infrastructure is due to one of the lowest scores for 4G coverage, along with significant improvements which may be required to the road network.
Germany is in the top five in the policy and legislation and the technology and innovation pillars, but is dragged down by mid-table rankings for infrastructure and consumer acceptance. It receives high scores on government investment in AV infrastructure and pilots, with its government legislating in 2017 to allow tests of self-driving cars on public roads.
On technology and innovation, it scores the highest on industry partnerships and on R&D hubs.
Germany is second only to Japan on AV patents issued per capita. But while the country has the highest possible score for road infrastructure and rates well on both road and mobile network quality, it has poor 4G coverage and a middling rating for technology infrastructure from KPMG’s Change Readiness Index. It has no ongoing AV tests and a low acceptance of the technology by consumers, explaining its relatively low rank on consumer acceptance.
Canada rates well on technology and innovation, with the highest possible score for industry partnerships and high scores on both research and development hubs and AV technology company headquarters. However, it has very few patents in this area. It gains maximum marks on government-funded AV pilots, with the province of Ontario having taken a particular lead as the only jurisdiction to have issued permits for AV testing on public roads.
On infrastructure, Canada is well-rated for roads and mobile networks, with its major telecoms providers successfully testing 5G network technology — although other variables lead to a middling rank overall. On consumer acceptance it is one of the leaders in terms of people living in an AV test area and is well-rated by both KPMG’s Change Readiness Index and the WEF.
8. United Arab Emirates
The first surprise on the list in terms of its high rank, the UAE scores well on both policy and legislation and on infrastructure. On the former, it is credited for having a specific AV function within its transport department, for quality of regulation and for government capability in KPMG’s Change Readiness Index. On infrastructure, it has the highest ratings of all 20 countries in this research for road quality from the WEF and for technology infrastructure from the Change Readiness Index.
However, KPMG report finds that the UAE lacks AV technology company headquarters, patents or investments, largely explaining its lower rating on technology and innovation. Consumer survey data shows a high level of acceptance of AV technology, but KPMG’s Change Readiness Index rates the country lower than others for people and civil society’s use of technology.
9. New Zealand
New Zealand emerged from the shadows its big brother Australia, and ranks second only to Singapore on policy and legislation, with high scores for its AV regulation and having a specific department to deal with this. It has no specific legal requirements for cars to have drivers and the NZ Transport Agency can provide support to those undertaking testing of AVs. It is also collaborating with Australia to minimize duplication and share knowledge.
The WEF highly ranks it for lawmaking and legal system efficiency and the country is 5th on consumer acceptance due to good ratings from KPMG’s Change Readiness Index and WEF, as well as having AV tests in areas covering a significant proportion of the population.
What the country scores low on are technology and innovation, with no AV company headquarters, patents or investment found in the research, although it has the third-highest market share of electric cars. New Zealand’s future performance on innovation could be boosted by a trial of satellite-based augmentation system technology, which its government is carrying out with Australia to improve the accuracy of positioning systems such as GPS.
10. South Korea
With best 4G coverage among the 20 countries in this research, and excellent mobile networks as well as good quality roads, South Korea ranks fourth on infrastructure. It is mid-table on technology and innovation, scoring top marks on industry partnerships and research and development hub presence and well on patents. However, it has few AV technology company headquarters, low usage of electric cars and Uber has little presence in the country.
The country scores well on AV-specific policy and legislation variables, with maximum points for government investment in pilots and AV infrastructure. Its weaker overall rating in this pillar is due to low scores from both KPMG’s Change Readiness Index and WEF.
AV is surely a technology whose time has come. Companies including the dominant vehicle makers, technology giants and specialist startups have invested $50 billion over the last 5 years to develop AV technology, with 70% of the spending coming from outside the automotive sector. At the same time, public authorities can see that AVs offer huge potential economic and social benefits. AVs could eliminate the 90–95% of road accidents caused by human error, saving as many as a million lives every year. Assuming they are electric, they should also reduce road pollution, improving citizens’ health. AVs offer mobility benefits to people who are unable to drive at present, including the elderly, those who do not own a car and those who live in rural areas that do not have adequate public transport. And the hours spent driving which now become productive creates a potentially gigantic economic boost, with one study estimating that the US economy could see an uplift of US$1.3 trillion a year.