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Self-Driving Car Startup Loses License in California

The company was recently valued at around $8.5 billion after a $400 million investment from Toyota.

Along with electric vehicle engines catching fire, an accident with self-driving cars can do a lot of damage to the company's image and rollout.

When a self-driving Uber  (UBER) - Get Uber Technologies Inc. Report SUV caused the 2018 death of Elaine Hertzberg in Arizona, the company suspended pilot testing and did not renew its self-driving vehicles amid a public outcry and criticism from the National Transportation Safety Board.

There have also been multiple stories of Tesla  (TSLA) - Get Tesla Inc. Report cars getting into accidents while in self-driving mode.

But even so, the push to bring more self-driving cars to the roads has continued its march forward.

There are currently around 1,400 self-driving cars, trucks, and other vehicles from more than 80 companies undergoing testing all over the country.

What's The Self-Driving Scandal This Time?

Most recently, an autonomous vehicle startup called Pony.ai lost its license to test its cars with a safety driver in the state of California.

As first reported by TechCrunch, the state's Department of Motor Vehicles revoked the permit that had allowed Pony.ai to test-drive 41 autonomous cars with 71 safety drivers, or a person who can take control of the car in case of a problem.

In November 2021, the startup based both out of Silicon Valley and Guangzhou, China, had already lost the permit for testing without a safety driver after a self-driving car crashed while changing highway lanes in Fremont.

"While reviewing Pony.ai’s application to renew the testing permit, the DMV found numerous violations on the driving records of active Pony.ai safety drivers," the spokesperson told TechCrunch.

Pony.ai, which was recently valued at around $8.5 billion after a $400 million investment from Toyota  (TM) - Get Toyota Motor Corporation Report in 2021, was founded in 2016 and has been working to bring its self-driving cars to more markets in both the U.S. and Asia.

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"Pony.ai approaches the development of autonomous vehicle technology with safety as our foundation, and we are proud of our safety record," a Pony.ai spokesperson said in a media statement.

"Pony.ai has driven over 6.8 million real-world autonomous miles, in which no injuries have occurred."

Earlier this year, it had received permission to bring over 100 self-driving taxis to the roads in the Guangzhou region of China.

"Because of the critical role of safety drivers to facilitate the safe testing of autonomous technology and the need for these drivers to have a clean driving record as established by the DMV’s autonomous vehicle regulations, the DMV is revoking the permit, effective immediately," the California DMV spokesperson said.

Have Self-Driving Cars Hit A Road Bump?

Self-driving cars have been heralded as "the future" so many times that many are surprised we are not seeing more of them by now. 

In 2016, some were predicting that 10 million self-driving cars would be driving around the U.S. by 2020.

But as time has shown, actually bringing self-driving technology to the roads has proven to be much more challenging than promising it. 

Permits are hard to receive and, as Pony.ai's case shows, easy to lose. 

While the technology for self-driving vehicles has been designed years ago, certain snags that arise in a few percent of situations prevent it from being embraced more widely. 

High-profile accidents have also been pushing regulators to take a more conservative approach when it comes to allowing self-driving cars on the road.

"The last 10% is really difficult,” Matthew Avery, director of research at Thatcham Research, recently told The Guardian. 

"That's when you've got, you know, a cow standing in the middle of the road that doesn't want to move."