Episode 124 | 2023 Autonomous Vehicle Market Outlook

The Road to Autonomy

David Welch, Detroit Bureau Chief, Bloomberg and Author of Charging Ahead, General Motors, Mary Bara, and the Reinvention of an American Icon joined Grayson Brulte on The Road To Autonomy Podcast to discuss his 2023 outlook on the autonomous vehicle market.

The conversation begins with David sharing his outlook for the autonomous vehicle market in 2023. David shares his thoughts on the market and insights into how investors are currently valuing autonomous vehicle companies.

As the conversation evolves, Grayson asks David if it is time for Aurora to split the business in two and focus solely on autonomous trucking.

I think there is so much of a focus on their trucking side that for all practical purposes it’s one company. I do not know that they need to split it, because I do not know if there is enough activity going on on the other side to make a difference. – David Welch

If Cruise and Waymo build a large enough of a lead in robotaxi deployments, there is the possibility that Aurora becomes a technology company for the trucking industry. If Aurora’s stock continues to decline, while at the sametime their technology continues to improve, a traditional trucking company could make a move and acquire Aurora.

With all the moves being made in the autonomous vehicle industry, Microsoft is steadily making strategic investments that will help drive the growth of the company’s Azure cloud platform. Over the last 18 months, Microsoft has invested in Cruise, Gatik and Spartan Radar.

Microsoft, this is not a venture cap fund, they have to see something before they put money in it. It’s a good sign for anyone who gets funded by them.– David Welch

Microsoft has an advantage when it comes to other cloud providers as the company does not have an in-house autonomous vehicle program. Amazon has a program with Zoox and Alphabet has a program with Waymo. For awhile, Zoox was at the forefront of every autonomous vehicle conversation, and then slowly overtime the company has quietly disappeared from the AV dialogue.

What are Amazon’s plans for Zoox? Grayson and David discuss what Amazon’s plans for Zoox could be. Could Zoox’s autonomous technology be integrated into Amazon’s Rivian delivery vans? It’s a possibility as Amazon is major investor in Rivian.

Another major question in the market is what happens to Lyft? Who steps in and buys the company?

It’s not a profitable business. It’s way too expensive for what it is right now for anyone to buy it. – David Welch

Or could an airline possibly step in and buy Lyft and integrate the company into their passenger operations? If they were to do this, the airline would need an autonomous vehicle strategy. Taking a broader look at the AV industry, David and Grayson discuss Motional and the company’s strategy to scale. Does Motional have enough capital to scale and compete against Cruise and Waymo?

Then there is the second tier of autonomous vehicle companies led by May Mobility. May’s strategy to operate in rural suburban areas that lack public transit is winning over politicians, riders and investors as the company scales in these areas.

I think it’s a very interesting company. – David Welch

Tesla is also an interesting company. Looking to the future does Tesla open the Dojo platform and does the company create a true SUV? Grayson and David discuss the possibilities.

Wrapping up the conversation, David shares his thoughts on what he sees happening in the autonomous vehicle market over the next 12 months.

Recorded on Tuesday, January 10, 2023

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