They’re coming faster than you think…
Autonomous Vehicles

They’re coming faster than you think…

Autonomous delivery drones will arrive in three years. Self-driving trucks will hit roads two years later.

This week, Reuters reported the Japanese government’s plans to launch the autonomous future promised in science-fiction movies.

It’s not a huge surprise. The engineering is mostly a solved problem. The sticky wicket has been shifting public policy.

“The priorities are improving life expectancy, revolutionizing transport, modernizing supply chains, improving infrastructure and using financial technology,” a Japanese official said.

Well, when you put it that way.

Most of the public is not there yet, unfortunately. They’re terrified of giant, speeding robot trucks, or worse, malfunctioning drones falling from the sky.

Policymakers are pushing forward because they feel they must. The New Gilded Age is about getting there first. The exponential advance of information technology makes most ideas possible. It also determines early winner and losers.

Japan understands friendliness to technological advance is central to attracting new investment and to its future economic growth. Being tech friendly will also help with chronic labor shortages in the Land of the Rising Sun.

So, it plans to ease regulations so developers can get started now.

It’s hardly alone. China has been remarkably benevolent to local and international car companies that want to develop self-driving cars. BMW and Volvo are testing autonomous cars on China’s public roads right now.

In less than a decade, old-fashioned trucks like these will be replaced by self-driving models that don’t even need cabs for people.

In Germany, the government encourages manufacturers to explore automation and advanced robotics. The government even takes an active role with public investment.

It’s little wonder Elon Musk’s search to find the machines to build Tesla’s fully automated factory, began and ended in Germany.

For investors, the search is less clear. While automation will surely be a boon to engineering companies, few are pure plays. Fewer still are public companies.

The research firm International Data Corporation estimates spending for robotics and related equipment will reach $188 billion by 2020. That is more than double the 2016 run rate of $91.5 billion.

The research I provide to my members covers up and down the supply chain. My research team digs through conference-call transcripts, trade journals and independent research reports to find winners in fields like sensors, software, integrated circuits and semiconductor equipment.

Not all will participate equally. It’s important to get it right.

It’s also important to begin the search now. Many investors believe these advances in technology are somewhere off in the distant future. That is simply not true.

Technology is advancing at warp speed. And policymakers feel compelled to get aboard or get left behind. When commercial drones begin showing up in the skies above, the easy money will have been made.

Now is the time to invest in technology leaders like Nvidia (NVDA), Amazon (AMZN) and Alphabet (GOOGL) — and many more smaller firms that are emerging in this space.

Best wishes,

Jon Markman


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Comments 6

Scott Hartzler June 2, 2017

Oh, no! All this “unfounded” evidence. Your site should have remained impartial. Wait! Even if Trump gets through and remains President, your forecasts will still be wrong…cuz this type of uncertainty is enough to quash Wall Street. And I think you all know it.


Tin June 1, 2017

invest in building our own Orwellian prison ? Having a moral compass . The inherent ability and courage to stand for what’s right and just for what’s right for you. Making money and participating in our own demise as a divine creation doesn’t even make the radar of this guy.


Ted F June 1, 2017

When the Bay Area Rapid Transit started almost four decades ago the trins were automated, however the trains carry “operators” because the system doesn’t always work, people get caught in the doors and the train brain doesn’t know it. The system was originally design for 5 minute headways. The BART system spent almost as much money as the original system cost to upgrade the computer system to cut the head ways to 3 minutes. By contrast the legendary Key System rolled trains off their ferry pier with people on 30 second headways. Trains could be sent across the Bay Bridge on 45 second headways. And the Key was one minute faster to downtown Berkeley than BART is today with elevated tracks and tunnels. Key by contrast was private right of way and city streets. Ain’t progress wonderful?


Owen June 1, 2017

This will cause massive job loses. The jobs that surround a single truck traveling the highway are many. From gas stations, hookers, eating places, highway patrols, road side assistance, hotels and lodges, insurance premiums lowered, etc etc. The knock on effects are huge. Now go to third world countries who don’t have the good infrastructure and suddenly we have a large gap in how economies operate. The pace of automation is rapidly outpacing the pace of human job creation. Expect more radical governments to be voted in as the jobless vote anti establishment and expect more terror attacks / wars as hopelessness rises. Japan has a labour shortage while say South Africa has a total over supply. Driver less trucks solve Japan’s problem while they exaccerbate South Africa’s situation. This just creates more inequality.


Scott Hartzler May 31, 2017

Whom will buy the products being made and delivered by automation. As jobs for human beings are exponentially replaced by robotics, so goes spending. Even arrogant analysts like you must concede that human beings with no jobs and no money can’t purchase the goods produced by robots; robots don’t buy cars or houses. Your business model is highly flawed. Go ahead and put a million job losses per year in your beloved AI model and let me know the results.


H. Horrace Newberry May 31, 2017

I just can’t wait to see human-terms minimized in the public transportation equation.