Study: Global Market for Self-Driving Cars to Reach 11.8 Million by 2035

Annual global demand for cars equipped to drive themselves will rise from nearly 230,000 units in 2025 to 11.8 million in 2035, IHS Automotive predicts.

The research firm's report, Emerging Technologies: Autonomous Cars Not If, But When, estimates the latter volume will include 7 million vehicles that allow driver or autonomous control and 4.8 million lower-cost models that are built for automatic self-driving only.

By 2035, the study says, many new autonomous vehicles will be designed to work only automatically and will not be equipped to be operated manually by a human driver. By 2055 or later, virtually all new cars will be built that way, says author Egil Juliussen.

The appeal of automatic vehicles is the promise of improved air quality and a sharp drop in crashes and traffic congestion. But IHS says sales growth could be delayed by a lack of liability laws or government rulemaking for self-driving vehicles. It adds that the two big technology risks are software reliability and cyber security.

The study estimates the cost of on-board systems that enable both manual and automatic control will add $7,000-$10,000 to a car's retail price by 2025. The premium will fall to about $5,000 by 2030 and $3,000 by 2035 as carmakers eliminate conventional driver controls in their autonomous models.

The study forecasts that by 2035 North America will account for 29% of the global sales of self-driving cars some 3.5 million units per year that are either completely automatic or combine driver and autonomous control.

China will become the world's second-largest market for such vehicles (24% share, or 2.8 million vehicles), according to the report. It says western Europe will be third with 20% and 2.4 million annual sales.