The days of dad driving the family in a 1956 Chevy Corvette on the family summer vacation are but a distant memory, as the automotive industry undergoes rapid technological change. Led by the ideal of the muscle car, the internal combustion engine is going by the wayside, rapidly being replaced by electric vehicles. And with the introduction of technology on a grand scale, soon cars won't need drivers at all -- everything will be done by a computer smarter and quicker than you.
The autonomous car or driverless car market is expected to reach more than 138,000 units by 2024, according to research from Granview Research. While that may not sound like an impressive figure on its own, that number is nearly 0 today, indicating exponential growth in just a few short years.
In order to get to an autonomous car market of any size, there must be millions of miles of testing done on real-world roads, certified by government agencies. Some 90% of all accidents are caused by human error according to the International Organization for Road Accident Prevention, so testing and re-testing is paramount to ensure safety. According to data from investment bank Morgan Stanley, the adoption of autonomous vehicles could save 1.3 million lives, indicating a need for advanced driver assistance systems (ADAS).
But with a fully autonomous car (known in the industry as Level 5 autonomy), comes a massive shift of time. Drivers are no longer sitting in traffic, using precious time doing nothing. Therein lies the investment opportunity -- companies that are working to unlock the monetization opportunities of the near 600 billion hours annually spent behind the wheel of a car. To put that in perspective, 600 billion hours is equal to 68 million years, or longer than the time the dinosaurs walked the Earth.
To give it greater perspective for investors, Morgan Stanley estimates the market of shared and automated transport "...representing an economic opportunity for content and data worth potentially trillions of dollars."
The investment bank has put together a list of U.S.-based companies whose businesses may benefit from being exposed "to growth opportunities in the execution of a shared, autonomous, electric ecosystem."
While a fully autonomous car is still something to be thought of as a future achievement, it's no longer a pipe dream.
These ten companies are likely to benefit from their exposure to autonomous, shared and electric vehicles now and well into the future.
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The Model S has had autonomous features going on for nearly two years and is generally thought to have achieved Level 3 certification by the National Highway Traffic Safety Administration (NHTSA). When we achieve Level 5 autonomy is still anyone's guess (many believe it happens in the next 15 to 20) years, but Musk has gone on record saying he thinks it will happen sooner than that.
In putting together the list, Morgan Stanley cited Tesla's "unique attributes for long-term growth" as part of its favorable outlook.
Another Wall Street poster boy, Nvidia (NVDA - Get Report) has become the de-facto way to invest in machine learning, artificial intelligence and driverless cars, largely due to its superior graphics chips.
The company, whose shares are up more than 50% year-to-date and five-fold over the past two years, already generates a significant amount of revenue from the automotive world, with promises of more to come.
The company also makes chips for automotive cameras, something which Morgan Stanley believes will aid the company, as "[a]utonomous cars represent a sophisticated blend of computer power and artificial intelligence for navigating the countless number of real-world driving scenarios...in real time."
In the announcement of the deal, Intel CEO Brian Krzanich said that together, the companies "can accelerate the future of autonomous driving with improved performance in a cloud-to-car solution at a lower cost for automakers."
The rumors became fact when CEO Tim Cook confirmed them in a Bloomberg interview.
"We're focusing on autonomous systems," Cook said. Describing it as "the mother of all AI projects," Cook added that "it's a core technology that we view as very important."
The maker of hit movies such as "The Avenger" series, "Star Wars" and its live-action remakes of hit animated classics, Morgan Stanley believes Disney will be "a beneficiary of the incremental content consumption up for grabs."
"Our software team ... sees Salesforce.com as well positioned for IoT Cloud, Service/Community Cloud applications from transportation as a service," Morgan Stanley said.
Though much of the excitement surrounding Amazon (AMZN - Get Report) is on its $13.7 billion deal for Whole Foods (WFM) and the reimagining of the grocery store, the Jeff Bezos-led company could be poised to benefit from the autonomous car revolution.
Morgan Stanley's analyst highlighted the company for its "dominance in capturing commercial value and time spent by consumers enclosed in a mobile, connected, super-computing environment."
Like Amazon, Facebook (FB - Get Report) too is included on the list for its "dominance in capturing commercial value and time spent by consumers enclosed in a mobile, connected, super-computing environment."
The Mark Zuckerberg-led company has said its core mission is connecting everyone in the world, a mission that could be enhanced by spending significantly more time on Facebook.