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9-1. Potential Barriers for Market Entry due to Technical Regulations of Automated Vehicles


In the United States in 2011, there were an estimated 5,338,000 police-reported traffic crashes, in which 32,367 people were killed and 2,217,000 people were injured. [1] While these numbers have declined significantly in recent years, the fatalities and injuries caused by automotive crashes still represent a major concern for society to address. [2] Over the years, the automotive industry has made tremendous advancements in implementing safety features that have contributed in the improvements of vehicular safety performance. However, many of these crashes are due to factors such as, driver fatigue, alcohol impairment, excessive speed, and over-correction. Vehicle automation has been recognized to be one approach that can overcome the tentative errors or inherent deficiency that drivers may experience. Built upon the foundation of many technological capabilities that come with advanced driver assistance systems on modern vehicles, teams from industry and academia are engaged in research on vehicles that will assist or replace human drivers in performing many driving tasks. These vehicles—which use a combination of sensors, actuators, and computerized control —are currently being tested on public roads in several states, and may possibly be available for sale to the public as soon as before 2020. [3, 4] Along with the latest technological advancements of automated vehicles and their potential entry into the market, concern has been expressed about how safely automated vehicles can perform either in interacting with regular traffic on public roads or in a designated, special environment. The safety performance of an automated vehicle may be fundamentally different, because the human driver may not be actively and continuously engaged in control or monitoring of its operation. As a result, the National Highway Traffic Safety Administration (NHTSA) has issued a policy statement concerning automated vehicles [5] and several states have enacted legislation addressing automated vehicles.[6] The issue is real, as the concern for public safety is well placed. In the meantime, research into multiple aspects of the operation of such vehicles, including testing, certification, and licensing, is underway. [7] Technical standards and safety regulations are relatively well established in the United States, such as the Federal Motor Vehicle Safety Standards (FMVSS) that cover a broad range of safety requirements. An essential question, which should be addressed in a careful manner, is how comprehensive and detailed potential regulations for emerging technologies, such as automated vehicles, should be created and enforced. On one hand, there is a well justified need to assure public safety. On the other hand, there is a potential for regulations to hinder the advancements or market introduction of automated vehicles by limiting testing or constraining operation on public roads. Between the two extremes of no regulations or excessive regulations, there is a strong need to seek a balance.


This research study will investigate the potential impacts on product development and market entry that are caused by regulations, including those for testing by manufacturers or technology providers, safety standards, certification of products, and licensing to operations. The research plan includes the evaluation of the following:

§ Historical case studies of safety regulations in the United States (at Federal and state levels)

§ Comparison of applicable case studies from other countries

§ Potential forms of regulations and mechanisms of enforcements

§ Legal implications of regulations

§ Estimation of resource needs and costs to industry

§ Approaches for quantifying technical regulations and their impacts on product introduction and market penetration


As explained above, this research covers a significant aspect of automated vehicles that is not well defined and explored as of today. If the initial stage of research suggested by this research statement is successful, it will enhance the understanding of this critical problem and encourage thorough definitions of potential regulations that government and industry must face jointly. The measure of effectiveness of this research project can be indicated by the completeness and clarity of the report out of this project, and the quantifying modeling techniques or approaches that can be utilized by stakeholders.

Related Research:

One earlier study was focused on fuel economy standards on the US automotive market. [8] NHTSA published a report on regulatory impact analysis after an amendment to FMVSS 208 for occupant crash protection. [9] Most of the studies on impact analysis have mainly attempted to address a broad perspective on overall regulations. For example, a paper in 1985 related regulations to innovation. [10] A publication in 1995 addressed the relationship between state environmentalism and economic growth for the period 1982-1992. [11] A more recent study in 2010 conducted a high-level review of the relevant literature and extracted those concepts from which a general inference can be made about the impact of different regulatory regimes on innovation in the private sector. [12]

The creation of technical regulations can also potentially lead to barriers in international trade. [13] The World Trade Organization (WTO) has stated, “In recent years, the number of technical regulations and standards adopted by countries has grown significantly. Increased regulatory policy can be seen as the result of higher standards of living worldwide, which have boosted consumers' demand for safe and high-quality products, and of growing problems of water, air and soil pollution which have encouraged modern societies to explore environmentally-friendly products.” The WTO has further stated, “Although it is difficult to give a precise estimate of the impact on international trade of the need to comply with different foreign technical regulations and standards, it certainly involves significant costs for producers and exporters.”

Historically, we have seen varying levels of technical requirements for the introduction of new technologies in the automotive industries. For example, air bags were experimentally marketed by General Motors in the 1970s before any formal regulation was enforced. There was a long process of back-and-forth debates and discussions before revisions to FMVSS 208 were finalized in the 1980s. [14] On the other hand, many new technologies, such as electronic stability control, adaptive cruise control, lane keeping assist, and assisted or automated parking system have been introduced in recent years without the involvement of specially targeted regulations. These new technologies and their associated sensing, processing, and control capabilities are relevant to and constitute part of the functional requirements for automated vehicles. The latter case of positive introduction of new technical features in new vehicles is a reflection of the typical stringent and thorough internal processes applied by manufacturers to ensure that marketability and performance needs are satisfied prior to a vehicle being sold to the public. There are lessons to be learned in these historical cases and to help us find a balanced approach to achieve technological progress as well as advocacy of public safety.


  1. NHTSA. “Traffic Safety Facts - 2011 Data”. Publication DOT HS 811 753. April 2013. Available at http://www-nrd.nhtsa.dot.gov/Pubs/811753.pdf.

  2. 2.

Zero Fatalities, accessed at http://zerofatalities.com/.

  1. Crovitz, L. G. “Horseless Carriages to Driverless Cars”. Wall Street Journal (July 7, 2013). Available at


  1. White, J. B. “Nissan Expects to Market Self-Driving Cars by 2020”. Wall Street Journal (August 27, 2013). Available at http://online.wsj.com/article/SB10001424127887323407104579038832031956964.html

  2. NHTSA. “U.S. Department of Transportation Releases Policy on Automated Vehicle Development”. May 30, 2013. Available at http://www.nhtsa.gov/About+NHTSA/Press+Releases/U.S.+Department+of+Transportation+Releases+Policy+on+Automated+Vehicle+Development

  3. California Department of Motor Vehicles. Vehicle Code Section 38750 - Autonomous Vehicles. Available at http://www.dmv.ca.gov/pubs/vctop/d16_6/vc38750.htm.

  4. 2nd Annual Workshop on Road Vehicle Automation. Breakout Session on Testing, Certification, and Licensing. Stanford, CA, July 2013. Information available at http://www.vehicleautomation.org/program/breakouts/testing-and-certification

  5. J.H. Boyd, R.E. Mellman, “The effect of fuel economy standards on the U.S. automotive market: An hedonic demand analysis”, Transportation Part A: General, Volume 14, Issues 5–6, October–December 1980, Pages 367–378.

  6. NHTSA. “Final Regulatory Impact Analysis – Amendment to Federal Motor Vehicle Safety Standard 208 Passenger Car Front Seat Occupant Protection”. Publication DOT HS 806 572. July 1984. Available at http://www-nrd.nhtsa.dot.gov/Pubs/806572.pdf.

  7. N.A., Ashford, C. Ayers, R.F. Stone, Robert F., “Using Regulation to Change the Market for Innovation”, Harvard Environmental Law Review, No. 9, Rev. 419, 1985.

  8. S.M. Myer, “The Economic Impact of Environmental Regulation”, Journal of Environmental Law & Practice. 1995.

  9. L.A. Stewart, _“The Impact of Regulation on Innovation in the United States: A Cross-Industry Literature Review”, _Information Technology & Innovation Foundation, June 2010.

  10. World Trade Organization. “Technical Information on Technical barriers to trade”. Available at http://www.wto.org/english/tratope/tbte/tbtinfoe.htm

  11. Air Bags, Wikipedia, http://en.wikipedia.org/wiki/Airbag, accessed September 2013.


With increasing interest from industries, government agencies, and academia on the potential deployment of automated vehicles in the imminent future, this topic deserves immediate attention and high priority and should be investigated as it relates very closely to the societal and institutional issues that are centered around an important game-changer of the automotive industry but also it can offer insight on the economic impacts.


The outcome of this research will be presented in a report that covers those subject areas described in the OBJECTIVE sections. The summary for each topic area can be directly applied to and used by those who are engaging in further research or policy decision.


The audience for this research problem statement is expected to include, but not be limited to the following: • NHTSA • State governments • Vehicle manufacturers and suppliers • Legal researchers • Technology researchers • Economic researchers

Sponsoring Committee:ACP30, Vehicle-Highway Automation
RNS Developer:Ching-Yao Chan and George Nicols
Source Info:AHB30, Steve Shladover, Ching-Yao Chan and George Nicols
Date Posted:10/07/2014
Date Modified:12/31/2014
Index Terms:Vehicle safety, Regulations, Crashes, Technological innovations, Intelligent vehicles, United States, Market share,
Cosponsoring Committees: 
Safety and Human Factors
Vehicles and Equipment

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