After investors bet an estimated ~$100B on self-driving vehicle startups, little progress has been made as companies take shortcuts and losses continue to mount
The first car woke Jennifer King at 2 a.m. with a loud, high‑pitched hum. “It sounded like a hovercraft,” she says, and that wasn't the weird part. Tweets: @trippmickle , @trengriffin , @joelwebershow , @upstatefederlst , @chafkin , @timothypmurphy , @bw , and @mccarthyryanj Tweets: Tripp Mickle / @trippmickle : Anthony Levandowski has gone from driverless car evangelist to apostate: “You'd be hard-pressed to find another industry that's invested so many dollars in R&D and that has delivered so little.” @chafkin on the road to nowhere https://www.bloomberg.com/... Tren Griffin / @trengriffin : “The industry says its Derek Zoolander problem applies only to lefts that require navigating oncoming traffic. (Great.) It's devoted enormous resources to figuring out left turns” https://www.bloomberg.com/... Joel Weber / @joelwebershow : NEW @BW COVER! Driverless Cars Are Going Nowhere: After all the years and billions spent, we're still not even close to an autonomous future. And detractors are getting louder as the losses get bigger, by @chafkin https://www.bloomberg.com/... https://twitter.com/... @upstatefederlst : 6-7 years ago I had a talk with my boss at the time who said he didn't expect our kids to ever have to drive cars and I asked him if he'd ever actually worked at a software company. We were both working for a software company. https://twitter.com/... Max Chafkin / @chafkin : I've got a cover story @bw this week on the long unfulfilled promise self driving cars, and the industry pioneer who now says the whole thing has been wildly overhyped https://www.bloomberg.com/... https://twitter.com/... Tim Murphy / @timothypmurphy : love the lede here, where Waymo kept sending its “self-driving” cars to do three-point turns in the same woman's driveway but still insists it was working as intended. It's actually the future, it's good actually. https://www.bloomberg.com/... @bw : NEW COVER: Tech and auto giants have spent years hyping self-driving cars as a just around the corner innovation that would make our streets safer. Instead, they're increasingly looking like a $100 billion flop https://www.bloomberg.com/... https://twitter.com/... Ryan McCarthy / @mccarthyryanj : Media has long been way, way too sympathetic to the claims of the driverless car industry. (I'd argue a similar thing is happening now with coverage of AI) But this whole piece by @chafkin really good. https://www.bloomberg.com/...
Context & Ripple Effects
The skepticism now surfacing was visible early: back in 2016 analysts argued full autonomy was a decade away at minimum because people, police, laws, maps, and the technology itself weren't ready. Detroit's refusal to engage Google's secret Chauffeur project showed incumbents saw the same gap before eventually warming to it.
The industry's response was a fork: Intel's Mobileye built a business on safety-first driver assist it could sell today, while startups chased full autonomy on an estimated ~$100B of investor capital. By 2020, advice had already shifted toward commercializing the least demanding applications; this Bloomberg investigation documents what happened to the rest — shortcuts, remote operators, simulations, and mounting losses.
First-order effects
- Startups still promising full autonomy face a credibility crisis: Anthony Levandowski, once the field's evangelist, now calls it an industry that has delivered little for its R&D spend, and investors are confronting losses across the portfolio.
- Companies are already retreating operationally — substituting remote operators and simulation for genuine driverless capability — which changes what customers and regulators are actually buying.
Second-order effects
- Capital and OEM attention rotate toward vendors selling deployable driver-assist systems, where Mobileye's ~70% market share shows the revenue case for incremental autonomy over moonshots.
- The shortcuts described sharpen scrutiny of unverifiable claims: experts have already flagged that no public data exists to check safety claims by Tesla and others, so expect buyers and regulators to demand disclosure as a condition of trust.
Third-order effects
- If the pattern holds, autonomous driving consolidates around a two-tier structure: a small set of well-capitalized survivors pursuing narrow, commercial use cases, and driver-assist suppliers capturing near-term revenue while full autonomy timelines stretch indefinitely.
- A failed ~$100B capital cycle becomes the reference point for how investors price long-horizon deep-tech bets — demanding staged milestones and verifiable safety data rather than vision-driven fundraising.
The trend: Autonomy funding is cycling out of full-self-driving moonshots and into incremental, commercially provable driver-assist systems, with capital discipline replacing vision-driven bets.