🚗 AI on Wheels: The Race Toward Self-Driving Profitability
Global Autonomous Driving Outlook 2025
The Big Picture
Autonomous driving (AD) — once a moonshot concept — is entering its commercial decade.
As breakthroughs in AI, sensor fusion, and 5G connectivity converge, the industry is shifting from prototype to scale. Across the globe, companies are racing to define the technology, the business model, and the regulatory rulebook that will underpin the next mobility revolution.
According to Vantage Market Research, the global autonomous driving market was valued at $72.6 billion in 2024, and is projected to reach $658 billion by 2035 — a compound annual growth rate (CAGR) of 22%. MarketsandMarkets forecasts that the number of autonomous vehicles worldwide will nearly double to 76 million by 2035.
In short, the inflection point is near — and the window between technology readiness, policy acceptance, and capital access has opened.
The Rise of Autonomous Vehicles
Is the future of mobility driverless?
In the second half of 2025, Nissan conducted public road tests in central Tokyo, showcasing its autonomous driving system co-developed with Wayve. The technology is expected to reach consumers by 2027, positioning Nissan among a growing list of manufacturers accelerating towards autonomy.
Industry forecasts suggest that the market could reach $114.5 billion by 2029, with autonomous EV makers targeting EBIT margins of around $40 billion by 2030. For traditional automakers, start-ups, and tech firms alike, autonomous driving remains one of the most compelling frontiers of innovation.
Yet, despite bold claims and rising investment, fully self-driving cars remain several years away from mass adoption.
Levels of Autonomy: A Moving Target
Terminology in the sector remains fragmented. “Autonomous”, “automated”, and “driverless” are often used interchangeably — or to describe different degrees of automation. To standardise language, SAE International introduced a six-level classification system in 2014, based on the extent of driver involvement.
Level 0: Minimal automation; the driver controls all functions.
Level 2: Advanced driver assistance (steering, acceleration, braking support).
Level 5: Full autonomy, requiring no human intervention.
As of 2023, most passenger vehicles sold globally contained Level 2 systems, offering partial automation but still requiring continuous human supervision. Level 3 vehicles — capable of conditional autonomy — are expected to reach global markets by 2025, marking a pivotal transition from assisted to automated driving.
The Start-up Magnet
Between 2016 and 2024, funding in the autonomous vehicle sector fluctuated sharply.
The peak year, 2021, saw $12.8 billion invested — the highest on record. Both 2019 and 2024 also exceeded $9 billion in funding rounds, led primarily by U.S.-based ventures.
The U.S. accounted for over four times the capital invested in China. Yet Chinese unicorns often secured larger single-ticket deals. By early 2024, UISEE ranked as the world’s most-funded AD start-up, with two other Asian companies also in the global top five.
ZongMu Technology achieved the highest valuation among AD unicorns in mid-2021, surpassing several U.S. peers. Meanwhile, traditional automakers have entrenched themselves in the ecosystem, leveraging extensive patent portfolios across human–machine interfaces, communications, and safety systems.
Market Impact: Beyond the Car
Autonomous mobility promises far-reaching effects across logistics, urban transport, and freight.
An autonomous electric delivery truck, for example, could cost less than half per tonne-mile compared with a manually driven diesel equivalent. By 2035, autonomous taxis are projected to undercut today’s human-driven ride-hailing fares and private car costs in the United States.
The road ahead remains challenging — but the economic logic is undeniable.
📈 The Global Landscape & Investor Takeaways
🇺🇸 North America: Tech Giants Drive the Narrative
The United States remains the cradle of AD innovation, supported by flexible state regulation and deep capital markets.
