Market Overview

Autonomous Driving Could Actually Help Traditional Automakers: Here's How

Autonomous Driving Could Actually Help Traditional Automakers: Here's How
Related F
Ford To Pump $870M Into Valencia Plant For Kuga Production
BlackBerry May Be In Talks With Tata Motors For QNX Software Portfolio
EQUITY ALERT: Rosen Law Firm Announces Filing of Securities Class Action Lawsuit Against Ford ... (GuruFocus)
Related GM
Liability In Autonomous Car Crashes: Here's What Gene Munster, Warren Buffett And GM Say
Benzinga's Top Upgrades, Downgrades For November 20, 2017
A Simple Way To Analyze Berkshire Hathaway Holdings (Seeking Alpha)

In a new report, Deutsche Bank analyst Rod Lache discussed the impact that driverless cars will have on the U.S. auto industry. According to Deutsche Bank, 8.2 percent of all Americans and up to 61 percent of those living in urban settings will find autonomous vehicles cheaper and more convenient than privately-owned vehicles.

On the surface, this transition may seem like a negative for established U.S. automakers Ford Motor Company (NYSE: F) and General Motors Company (NYSE: GM), but Deutsche Bank believes that the availability of these autonomous vehicles will actually lead to an overall increase in total miles driven. Fleet purchases by operators such as Uber and Lyft could up demand for vehicles, but Lache cautioned that large orders will probably mean pricing leverage for buyers.

Related Link: We're Using Gasoline At A Record-Setting Pace In 2016

Competitive Advantages

In addition to margin pressures, Lache believes that non-traditional auto players like Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG) and Apple Inc. (NASDAQ: AAPL) could also have major competitive advantages over Ford and GM when it comes to technology and integration.

“These players may be able to use mobility services as the link between consumers’ digital and physical worlds, and they should have certain advantages in leveraging both,” Lache explained.

In terms of driverless services, he noted that Uber, Lyft and Didi have already established large networks and brand awareness and have a big advantage over future entrants.

Disclosure: The author holds no position in the stocks mentioned.

Image Credit: Public Domain

Latest Ratings for F

Oct 2017Morgan StanleyMaintainsUnderweight
Oct 2017CitigroupMaintainsNeutral
Oct 2017JefferiesMaintainsHold

View More Analyst Ratings for F
View the Latest Analyst Ratings

Posted-In: autonomous carAnalyst Color Travel Top Stories Analyst Ratings Tech Trading Ideas General Best of Benzinga


Related Articles (AAPL + F)

View Comments and Join the Discussion!

Partner Center