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While the idea of a self-driving vehicle may sound far-fetched, companies and governments have already made considerable investments to turn it into reality. For example, Google has driven autonomous vehicles hundreds of thousands of miles on U.S. roads, and the military has been developing driverless drone cars for a number of years. Fully autonomous vehicles will gradually evolve from features already in place in some cars, such as computer systems that automatically apply the brakes in stop-and-go traffic. Consumers like the idea of a self-driving car as well. In a survey I commissioned, 35 percent of U.S. vehicle owners said they would be likely to get autonomous driving features in their next new vehicle if these were an option.

New “mobility” business models

Of course, one could ask if we even need automobiles in the future. My answer: Absolutely. Cars and personal transportation are not going away. But we may increasingly replace automobile ownership with automobile access and see nontraditional companies disrupting the automotive industry’s established order. Imagine you would always have access to the car you want when you need it. Already startups, such as Getaround and RelayRides, offer peer-to-peer car sharing services, in which members can unlock your car with the wave of a smart phone and rent it by the hour. While this idea may sound odd to some, at Gartner we have found that the idea is more widely accepted among younger drivers.

I predict that within four years 10 percent of the urban population of the U.S. will use shared cars instead of personally owned vehicles. But this is just the beginning of how connectivity will create new business models and challenge some of the established industry players to become “mobility providers” instead of just car companies. I also predict that by the end of 2016 at least one mega-technology company will have announced disruptive plans to launch its own automotive offering.

Other industries may also be challenged by the evolution of the connected vehicle. Insurance companies, for example, will need to define new risk models based on drastically reduced accident rates. Governments might establish personal emission allowances to restrict the use of cars powered by internal combustion engines and monitor for aggressive or wasteful driving behavior. In the long term, the connected vehicle will have an impact on urban development as cities use technology to try to solve traffic, parking, and pollution problems.

The next two decades will be an incredibly creative period. The automotive industry and the vehicles we drive will change more than they have in the last century. Automobile companies must take advantage of these changes, define new values and products, and shape a new ecosystem of partnerships with technology companies. As cars move from being basic transportation to becoming intelligent systems, I am hopeful that they will continue to evoke the passions of enthusiasts like me.

Thilo Koslowski is vice president, distinguished analyst, and leader of the Automotive, Vehicle ICT & Mobility Practice at Gartner.

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