Limit Regulations on Autonomous Vehicles

Commentary

Limit Regulations on Autonomous Vehicles

Autonomous vehicles are no longer a fantasy that appears only in science fiction movies. In theory, the ongoing investments and research should allow many driverless cars to transition out of development and into widespread commercial use over the next decade. However, the typical precautionary principles that accompany new legislation act as a market barrier that will impede the commercialization of the technology. In August 2014, Google, which designed a prototype that removed the steering wheel, accelerator and brake pedals, was forced to reinstall these manual driver controls. This is one of the first examples of onerous regulations forcing the AV innovators to take a step back. To prevent these types of setbacks, policymakers should focus on clearing the existing roadblocks preventing the development of AVs and address the excessive restraints concerning the hypothetical dangers of their use. Only then, can the copious social benefits of AV technologies be realized.

Autonomous vehicles are vehicles that can drive themselves. In other words, they are capable of sensing the environment and navigating by themselves. In 2013, the National Highway Traffic Safety Administrationreleased a classification system that partitions vehicle automation into 5 levels, ranging from level 0 (no automation) to level 4 (fully self driving automation). The first semi-autonomous vehicles appeared in 1984 with Carnegie Mellon University’s Navlab and ALV projects. Ever since, autonomous vehicle research has been increasing, with major progress by Google, major auto manufacturers, government organizations and universities. In early 2014, IHS Automotive released a study projecting a global total of “nearly 54 million” self-driving cars by 2035, and predicting that “nearly all of the vehicles on the road would be self-driving cars or self-driving commercial vehicles by 2050.

In response to these predictions and the pressure to “legalize” the testing of AV technologies, new AV legislation to set policy has been introduced in many states, and enacted in California, Florida, Michigan, Nevada and the District of Colombia, to set policy. One important policy area these laws address is safety. For instance, most states’ rules mandate that a licensed driver be in the driver’s seat at all times during autonomous operation. Another policy area these laws address is liability. Typically, the laws set up a legal framework through which manufacturers can be held accountable for negligence in selling faulty products including strict liability for product defects or misrepresentation of product capabilities. One of the statutes enacted in the D.C., Florida, and Michigan laws contains specific language protecting original manufacturers from liability for defects introduced to the aftermarket by a third party who converts a conventional vehicle into an autonomous vehicle.

In some very specific and narrow respects, these state-level legislative actions regarding AV safety and liability can be beneficial. However, state laws also have the effect of slowing down the entry of new technology into the market. For example, California’s 2012 law on self-driving cars called for the state legislature to draft rules regarding AV operation by the start of 2015, although by mid-March 2015 there was still no draft available. In addition, the safety law that requires all autonomous vehicles have a human driver prevents the testing of fully automated vehicles. Hence, these laws effectively act as another set of onerous regulations preventing further innovation of autonomous vehicles.

While the concerns about safety are legitimate and the desire for comprehensive laws is reasonable, there are numerous reasons why it is poor policy to hinder the deployment of these new automotive technologies. First and foremost, self-driving vehicles are predicted to increase safety and decrease the number of accidents. Currently, more than 33,000 people die each year in the United States from automobile crashes. According to U.S. government estimates, as many as 90 percent of all car accidents are caused by human error. As such, the Eno Center for Transportation recently projected that if only 10 percent of all vehicles in the United States were self-driving, the number of accidents each year would be cut by 211,000, and 1,100 lives would be saved. Autonomous vehicles are the latest in a series of technologies that improve safety. For example, National Highway Traffic Safety Administration estimates that electronic stability control (ESC) systems, which use computer controls to brake individual wheels on a vehicle losing directional control or stability, saved 2,202 lives between 2008 and 2010. In addition, the legal precedents of products liability litigation established over the last half century provide AV manufacturers with a very strong set of incentives to make their products as safe as possible. Hence, encumbering the legal system with a new set of overly broad federal or state liability statutes relating to AVs is unnecessary.

Second, studies have suggested that intelligent vehicles can possibly reduce congestion and lower fuel consumption. Self-driving cars could ease congestion because commutes would be quicker, as cars driven by robots could travel at steadier speeds and avoid traffic jams. However, it is also true that the AV technology of Level 3 or higher is likely to substantially reduce the opportunity cost of congestion, hence inducing more people to drive, who would have otherwise not have made the trip. While the two possibilities may be offset and make it difficult to clearly predict the overall effects of AVs on congestion, most experts predict some decrease in congestion. When it comes to fuel consumption, the AV vehicles will allow for fuel efficiency because self-driving cars and trucks will be able to bunch close together at steadier speeds. The Rocky Mountain Institute estimates that the reduction in wind drag alone from vehicles traveling closely together could reduce fuel use by 20 to 30 percent. In addition, AV technology can improve fuel economy by 4-10 % by accelerating and decelerating more smoothly than a human driver. Finally, AVs might reduce pollution by enabling the use of alternative fuels. If the decrease in frequency of crashes allows lighter vehicles, many of the range issues that have limited the use of electric and other alternative vehicles are diminished.

Despite the social benefits policymakers have slowed down the legalization of AV research by imposing the “precautionary principle” on developing technology, potentially costing human lives. Hence, as argued by Adam Thierer and Ryan Hagemann of Mercatus Center, the optimal policymakers should adopt the “permission-less innovation” attitude towards driverless vehicle technologies and not the “precautionary principles” attitude. “Permission-less innovation” argues that experimentation with new technologies and business models should generally be permitted by default. This open and lightly regulated platform that allows entrepreneurs to adopt new business models and offer new services without first seeking approval from regulators. In this scenario, pre-emptively resolving liability issues would not be a precondition to commercial rollout of autonomous vehicles. Any perceived or actual problems with new technologies could be corrected later through better-informed policymaking.

In conclusion, the laws that that encourage overregulation of AV by trying to pre-emptively tackle hypothetical concerns of safety and liabilities will increase the cost of human lives, health, property damages and convenience. As such, the overall guiding principle for policymakers should be that AV technology ought to be permitted if and when it is superior to average human drivers. Safety regulations and liability rules should be designed with this guiding principle in mind. As the 2013 article in the San Diego Union-Tribune stated bluntly: “The issue of liability, if not solved, could delay or even wipe out the vision of driverless cars gaining widespread consumer use.” With this in mind, the ultimate goal of the policymakers regarding the AV should be to minimize government intervention in order to speed up the introduction of the innovation and consumer availability of automated vehicles.