Autonomous/Connected Vehicles: Getting to Optimal Liability

Editor's Notes

• #15: So how do we align development paths and liability exposures to deliver a compelling automated vehicle product and a fair and efficient liability regime. The answer lies in arranging a series of trades among the market participants: OEMs are risk adverse and incrementalist in their development approach because they want to keep the driver in the liability loop. Ride providers have something very valuable to give if they are able to dispatch automated vehicles that pick up people who do no driving. In that scenario the ride providers become common carriers with a heightened duty of care as a common carrier. So, in exchange for OEMs accelerating development of fully automated vehicles, ride providers like Uber agree to take on common carrier status when they go into business of dispatching fully automated vehicles. Ride providers need help in breaking down regulatory barriers to both automated vehicles and new generation ride providers. Highway authorities and associated metropolitan planning organizations have political influence that can be helpful. So, rider providers trade their willingness to absorb some of the liability associated with AV deployment in exchange for the help of highway authorities. Highway authorities need some reason to become actively supportive of AV development. They will get intensely interested if AV technology can deliver substantial gains in the carrying capacity of existing roadways, which means that highway authorities can deliver more transportation service without expanding the physical highway system at great expense. Highway authorities bring to the table substantial liability protections. The leapfroggers like Google have AV technology in their sights but aren’t focused on the needs of highway authorities. And they have substantial liability risks. That’s the basis for the trade: Leapfroggers and highway authorities work together on technologies that will reduce vehicle headways/increase speeds to radically improve the carrying capacity of our roads. But highway authorities must bear some of the responsibility for deploying this additional, capacity building technology so they can utilize the liability protections available to them. If leapfroggers demonstrate their commitment to delivering highway operational benefits then regulators need to accelerate AV development using standards rather than specific prescriptive regulations. These standards can supply liability protection to the companies who roll out AV technology in compliance with these standards. Regulators need to have realistic expectations before allowing AVs to be deployed—not requiring perfection, just substantial improvement over human operation. Regulatory commitment to advancing as quickly as possible to full automation will help the connectors, who want to open up the automobile as the next big screen, but are bedeviled by distracted driving liability risk. Connectors thus agree to support V2V and V2I efforts to help advance the deployment of fully automated and connected vehicles in order to realize all of the potential of connected, automated vehicles. By helping to connect vehicles to vehicles and vehicles to infrastructure, the connectors pave the way for more automated functions being handled by parties other than OEMs and leapfroggers. This means that the liability associated with the rollout of autonomous vehicles is spread around rather than concentrated in the OEMs. This should encourage OEMs to embrace getting to full automation sooner rather than later.
• #16: If we don’t align development strategies and liability we might get next generation vehicles that are uncomfortable hybrids of new and old that are as unpalatable as this early horseless carriage that linked the early auto with horse-propelled predecessors.
• #17: Optimal alignment via cooperation and self-interest will yield a connected automated vehicle that serves the interests of consumers, highway authorities, ride providers and others with a stake in transforming our highway transportation system.
• #18: This collaboration will yield vehicles and service models and connections that at this point we can only images. I foresee development of a variety of vehicles, each type customized for particular operating environments, ranging from high-speed highways to low-speed campuses.
• #19: Doing so will get us to optimal liability. If ride providers contribute common carrier liability exposure, highway authorities contribute immunity and existing state law protections, and the regulators use standards to encourage innovation and provide a liability safe harbor, then the implementers—the OEMs, the autonomous vehicle software developers, and those who are connecting vehicles to each other and cloud will have a more secure liability framework in which to operate. Compelling products advance optimal liability. A connected automated vehicle will be that compelling product. To get to that product the major players will have to work together and contribute a measure of liability exposure for the common good.