With billion-dollar funding rounds being limited to a few large companies, the self-driving car industry still appears to have a bumpy road ahead.

A handful of recent announcements and funding rounds suggest that autonomous driving is making a comeback. Elon Musk told an audience at a glitzy Tesla event in October this year that its self-driving Cybercab would be available “before 2027”. Less than two weeks later, Google led a $5.6bn round that valued Waymo at $45bn as the robotaxi producer – already a frequent sight on San Francisco’s roads – continues to expand into new cities.

The Waymo round is the largest so far in the autonomous driving sector, and it follows a billion-dollar round for self-driving technology developer Wayve in May 2024, and nine-figure rounds for Tier IV and DiDi Autonomous Driving since.

But these headline rounds obscure the fact that the self-driving car market is now largely divided between the few large companies pulling in rounds and the rest, for whom funding is drying up.

“You better be able to raise a lot of money to survive. I’m not sure the entrepreneurs understand that yet in automotive.”

“Now if you’re a new startup and you’re coming to me with a lidar technology pitch…you better be a lot better technology wise and you better be much cheaper, because we know that’s the main problem with lidar,” says Tony Cannestra, director of corporate ventures for automotive component producer Denso. “And you better be able to raise a lot of money to survive. I’m not sure the entrepreneurs understand that yet in automotive.”

This report, produced with support from the GCV Mobility Council and Denso, looks at the bumps that might still be ahead for the self-driving car industry in recent years.

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