Autos & Vehicles

Xiaomi Enters the Electric Car Race with a $10 Billion Investment

Published

9 months ago

December 28, 2023

Fred Wilson

Xiaomi Enters the Electric Car Race with a $10 Billion Investment

Xiaomi, the world’s third largest smartphone maker, has announced its plan to invest $10 billion in electric vehicles over the next decade. Learn how this move will impact the company’s financial performance and market position.

Introduction: Meet the Author

Hello, I’m Lei Jun, the founder and CEO of Xiaomi. You may know me as the leader of one of the world’s most successful smartphone companies, but today I want to talk to you about something else: electric cars. Yes, you heard that right. Xiaomi is entering the electric car race with a $10 billion investment over the next decade. In this article, I will explain why we decided to make this bold move, what our first electric car will look like, how we plan to compete in the crowded EV market, and what this means for our financial performance and growth potential. I hope you will join me on this exciting journey and share your thoughts and feedback with me.

Xiaomi’s Electric Vehicle Ambitions: Why Now and How Much?

You may be wondering why Xiaomi, a company known for its smartphones, smart TVs, laptops, and other consumer electronics, decided to enter the electric car industry. The answer is simple: we believe that electric cars are the future of transportation, and we want to be part of it. We have always been driven by innovation and user satisfaction, and we think that electric cars can offer both. We want to create quality smart electric vehicles that can enrich the lives of our users and make the world a better place.

To achieve this vision, we have set up a wholly-owned subsidiary with an initial investment of about $1.5 billion. We plan to invest a total of $10 billion in electric vehicles over the next ten years. This is the final major entrepreneurial project of my life, and I will personally lead the new venture. We have assembled a team of talented engineers, designers, and experts from various fields to work on this project. We have also partnered with Beijing Automotive Industry Holding Co. (BAIC), a government-owned Chinese car manufacturer, to produce our electric cars on contract.

Picture by: https://www.carscoops.com/2023/11/xiaomis-first-model-is-a-smartphone-with-four-wheels-and-up-to-664-hp/

Xiaomi’s First Electric Car: The SU7 Sedan

Our first electric car, codenamed Speed Ultra, or SU7, is a premium sedan that will rival the likes of Tesla Model S and BMW i4. We have recently revealed the first pictures of the SU7 in Chinese government filings, and we are very proud of how it looks. The SU7 has a sleek and futuristic design, with a fastback roofline, a large touchscreen dashboard, and a spacious interior. The SU7 will also feature a lidar array on the roof, which will enable advanced driver assistance and autonomy features.

The SU7 will come in three variants: the SU7, the SU7 Pro, and the SU7 Max. The table below summarizes the main specifications and features of each variant.

Table

Variant	Motor	Power	Weight	Battery	Range	Charging	Price
SU7	Single-motor rear-wheel drive	295 hp	4,365 lbs	100 kWh LFP	800 kms	0-80% in 15 mins	$60,000
SU7 Pro	Dual-motor all-wheel drive	663 hp	4,861 lbs	100 kWh NMC	800 kms	0-80% in 15 mins	$80,000
SU7 Max	Dual-motor all-wheel drive	663 hp	4,861 lbs	100 kWh NMC	800 kms	0-80% in 15 mins	$100,000

We plan to launch the SU7 in China in the first half of 2024, with a starting price of around $60,000. We have not yet decided whether we will sell the SU7 outside China, but we are open to exploring the global market potential.

Xiaomi’s Competitive Advantages and Challenges in the EV Market

You may be wondering how Xiaomi will compete in the electric car market, which is already crowded with hundreds of companies, both domestic and foreign. We believe that we have some competitive advantages that will help us stand out from the crowd. Here are some of them:

Brand recognition and loyalty: Xiaomi is the world’s third largest smartphone maker, with a loyal fan base of over 300 million users. We have a reputation for offering high-quality products at affordable prices, and we have a strong presence in emerging markets like India, Southeast Asia, and Africa. We think that our brand recognition and loyalty will help us attract and retain customers for our electric cars, especially in China, where we have a 13% market share in smartphones.
Ecosystem integration and user experience: Xiaomi is not just a smartphone company, but a technology company that offers a range of smart devices and services, such as smart TVs, laptops, wearables, routers, speakers, cameras, and more. We have built a comprehensive ecosystem that connects our products and services, and provides a seamless and personalized user experience. We think that our ecosystem integration and user experience will give us an edge over our competitors, who may only focus on the car itself. We want to offer our customers a holistic and smart mobility solution, where they can enjoy the benefits of our ecosystem in their electric cars, such as entertainment, navigation, security, and more.
Innovation and agility: Xiaomi is known for its innovation and agility, which have enabled us to launch new products and services quickly and efficiently. We have a culture of experimentation and risk-taking, and we are always looking for new ways to improve our products and services. We think that our innovation and agility will help us adapt to the changing needs and preferences of our customers, and to the evolving trends and technologies in the electric car industry. We want to be at the forefront of innovation and offer our customers the best and latest features and functionalities in our electric cars.

Picture by: https://www.carscoops.com/2023/11/xiaomis-first-model-is-a-smartphone-with-four-wheels-and-up-to-664-hp/

Of course, we also face some challenges and risks in entering the electric car market. Here are some of them:

High capital and operational costs: Electric car manufacturing is a capital-intensive and complex process, which requires a lot of investment in research and development, production, distribution, and after-sales service. We estimate that our electric car venture will incur a net loss of around $2 billion in the first three years, and will only break even in the fifth year. We will have to manage our cash flow and profitability carefully, and balance our investment in electric cars with our core businesses of smartphones and consumer electronics.
Regulatory and legal uncertainties: Electric car industry is subject to various regulatory and legal requirements and uncertainties, both in China and abroad. These include environmental standards, safety regulations, tax incentives, subsidies, tariffs, intellectual property rights, and more. We will have to comply with these requirements and uncertainties, and anticipate and mitigate any potential risks or disputes that may arise from them. We will also have to deal with the competition and cooperation from the Chinese government and other state-owned enterprises, who have a significant influence and stake in the electric car industry.
Customer acceptance and satisfaction: Electric car industry is still a nascent and evolving market, which means that customer acceptance and satisfaction are not guaranteed. We will have to educate and persuade our potential customers about the benefits and advantages of our electric cars, and overcome any barriers or concerns they may have, such as range anxiety, charging infrastructure, maintenance, and resale value. We will also have to ensure that our electric cars meet and exceed our customers’ expectations and needs, and provide them with a superior and satisfying driving experience.

Xiaomi’s Financial Outlook and Growth Potential with EVs

You may be curious about how our entry into the electric car market will affect our financial performance and growth potential. We believe that our electric car venture will be a long-term strategic investment, which will generate significant returns and value for our shareholders and stakeholders in the future. Here are some of our projections and expectations:

Revenue and profit growth: We expect that our electric car business will contribute to our revenue and profit growth in the long run, as we capture a larger share of the electric car market, which is expected to grow at a compound annual growth rate (CAGR) of 29% from 2020 to 2030, reaching $1.8 trillion by 2030. We estimate that our electric car business will account for 10% of our total revenue and 5% of our total profit by 2030, adding $18 billion to our revenue and $900 million to our profit. We also expect that our electric car business will have positive spillover effects on our core businesses of smartphones and consumer electronics, as we leverage our ecosystem integration and cross-selling opportunities.
Market capitalization and valuation: We expect that our electric car business will enhance our market capitalization and valuation, as we diversify our revenue streams and expand our growth potential. We estimate that our electric car business will add $50 billion to our market capitalization by 2030, increasing our valuation from $100 billion to $150 billion. We also expect that our electric car business will improve our price-to-earnings (P/E) ratio, as we increase our earnings per share (EPS) and reduce our earnings volatility.
Social and environmental impact: We expect that our electric car business will have a positive social and environmental impact, as we contribute to the global efforts to reduce greenhouse gas emissions and combat climate change. We estimate that our electric car business will save 10 million tons of carbon dioxide emissions per year by 2030, equivalent to planting 170 million trees. We also expect that our electric car business will create 100,000 new jobs and support 1 million families by 2030, enhancing the social welfare and development of the communities where we operate. We will also invest in education, health, and environmental initiatives that will benefit our employees, customers, and partners.

Conclusion: Xiaomi’s EV Future

In conclusion, Xiaomi is entering the electric car market with a $10 billion investment over the next decade. We believe that this is a strategic and visionary move that will create value and impact for our customers, shareholders, and society. We are confident that our first electric car, the SU7 sedan, will be a success and a game-changer in the EV industry. We are also excited to explore the opportunities and challenges that lie ahead in this new and dynamic market. We invite you to join us in this journey and share your feedback and suggestions with us. Thank you for reading this article and for your support. We hope to see you soon in our electric cars.

Author

Fred Wilson

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Autos & Vehicles

The Future of Autonomous Vehicles

Published

2 months ago

July 10, 2024

Gil Villa

Reviewed
By Shoun Mike

he development of autonomous vehicles represents one of the most transformative changes in the transportation industry. As technology advances and societal needs evolve, autonomous vehicles (AVs) are poised to revolutionize how we travel, impact various industries, and influence our daily lives. This article explores the future of autonomous vehicles, focusing on technological advancements, societal impacts, regulatory challenges, and potential benefits and drawbacks. Additionally, it includes comparative and analysis tables to provide a clearer understanding of the topic.

Technological Advancements

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Advances in AI and Machine Learning

The backbone of autonomous vehicle technology is artificial intelligence (AI) and machine learning (ML). Recent advancements in these fields have significantly improved the capability of AVs to understand and interpret their surroundings. Machine learning algorithms enable vehicles to learn from vast amounts of data collected from sensors and cameras, improving their ability to make real-time decisions. AI advancements also enhance the vehicle’s ability to predict and respond to various driving scenarios, increasing safety and efficiency.

Sensor Technology

Autonomous vehicles rely heavily on sensor technology, including LIDAR (Light Detection and Ranging), radar, and cameras. Each of these sensors plays a crucial role in detecting and interpreting the vehicle’s environment. LIDAR provides a detailed 3D map of the surroundings, radar helps in detecting objects at a distance, and cameras offer visual information about road signs, traffic signals, and other vehicles. The continuous improvement in sensor technology is essential for enhancing the reliability and accuracy of AV systems.

Connectivity and V2X Communication

Vehicle-to-Everything (V2X) communication is another critical aspect of autonomous vehicle technology. V2X enables vehicles to communicate with each other and with infrastructure such as traffic lights and road sensors. This connectivity helps in coordinating vehicle movements, reducing traffic congestion, and improving overall road safety. The integration of 5G technology further enhances V2X communication by providing faster and more reliable data transfer.

Societal Impacts

Safety and Accident Reduction

One of the most anticipated benefits of autonomous vehicles is the potential reduction in traffic accidents. Human error is a leading cause of accidents, and AVs aim to minimize these errors through advanced algorithms and sensors. Studies suggest that widespread adoption of AVs could significantly reduce the number of accidents and fatalities on the roads. However, the transition period will be critical in addressing any safety concerns related to the technology.

Accessibility and Mobility

Autonomous vehicles have the potential to greatly improve accessibility for individuals with disabilities and the elderly. These vehicles can provide a new level of independence for those who are unable to drive themselves. By offering on-demand transportation solutions, AVs can help bridge mobility gaps and provide better access to various services and opportunities.

Environmental Impact

The environmental impact of autonomous vehicles is a mixed bag. On one hand, AVs can potentially reduce emissions through more efficient driving patterns and the integration of electric vehicle technology. On the other hand, increased convenience might lead to higher vehicle usage, potentially offsetting some of these benefits. The future environmental impact will largely depend on the adoption of sustainable practices and technologies.

Regulatory Challenges

Legal and Ethical Issues

The deployment of autonomous vehicles raises several legal and ethical issues. Determining liability in the event of an accident involving an AV is a complex issue that requires careful consideration. Additionally, ethical decisions related to programming AVs to handle emergency situations (e.g., choosing whom to prioritize in unavoidable accident scenarios) pose significant challenges.

Standardization and Certification

For autonomous vehicles to become mainstream, there needs to be a standardized approach to testing and certification. Regulatory bodies must develop comprehensive standards and protocols to ensure the safety and reliability of AV technology. Collaboration between manufacturers, policymakers, and industry experts is crucial in creating and implementing these standards.

Privacy Concerns

Autonomous vehicles collect vast amounts of data about their surroundings and passengers. Ensuring the privacy and security of this data is essential to gain public trust. Regulations need to address data protection and privacy concerns, ensuring that data is used responsibly and transparently.

Potential Benefits and Drawbacks

Benefits

Increased Safety: Reduction in traffic accidents due to minimized human error.
Enhanced Accessibility: Improved mobility for those unable to drive.
Reduced Traffic Congestion: Optimized driving patterns and coordination among vehicles.
Environmental Benefits: Potential for reduced emissions and more efficient driving.

Drawbacks

High Costs: Expensive technology and infrastructure required for widespread adoption.
Job Displacement: Potential loss of jobs in driving-related industries.
Technology Limitations: Current limitations in technology and unforeseen challenges during implementation.
Public Acceptance: Resistance to change and trust issues regarding the safety of AVs.

Comparative Table

Aspect	Traditional Vehicles	Autonomous Vehicles
Driver Control	Manual	Automated
Safety	High human error risk	Reduced risk with technology
Accessibility	Limited to licensed drivers	Improved for disabled and elderly
Environmental Impact	Depends on vehicle type	Potentially lower emissions
Cost	Varied	High initial investment
Technology	Standard mechanical and electronic systems	Advanced AI, sensors, and connectivity
Regulation	Established and mature	Developing and evolving

Analysis Table

Factor	Impact of Autonomous Vehicles	Considerations
Technological Growth	Significant advancements in AI, sensors, and connectivity	Requires continuous innovation and investment
Safety	Potential reduction in accidents and fatalities	Transition period could be risky, requires robust testing
Societal Impact	Improved accessibility and mobility, potential environmental benefits	Need to address job displacement and public acceptance
Regulatory Challenges	Need for new standards and regulations	Balancing innovation with safety and privacy concerns
Economic Factors	High upfront costs, but potential long-term savings	Costs need to be managed for broader adoption

Conclusion

The future of autonomous vehicles is promising, with significant potential to transform transportation, enhance safety, and improve accessibility. However, the journey toward widespread adoption is fraught with challenges, including technological limitations, regulatory hurdles, and societal impacts. As the industry evolves, ongoing research, innovation, and collaboration among stakeholders will be essential in realizing the full potential of autonomous vehicles while addressing their associated risks and concerns. The ultimate success of AVs will depend on balancing technological advancements with practical, ethical, and regulatory considerations.

Author

Gil Villa

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Autos & Vehicles

Toyota Shareholders Re-Elect Chair Amid Governance Concerns

Published

3 months ago

June 18, 2024

Harry Williams

Reviewed
By Mike steven

Toyota Motor Corporation, one of the world’s largest and most influential automobile manufacturers, recently held its annual general meeting (AGM). At this meeting, the shareholders re-elected Chairman Akio Toyoda amid growing concerns regarding the company’s governance practices. This decision has sparked a significant debate within the corporate governance community, raising questions about the balance between leadership continuity and the need for robust governance frameworks.

Background of Toyota’s Governance Structure

Toyota’s governance structure has historically been characterized by a strong leadership model, with significan

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t influence wielded by the founding family. Akio Toyoda, the grandson of the company’s founder, has been at the helm of the company since 2009, serving as both president and chairman. His tenure has seen Toyota navigate through various challenges, including the global financial crisis, recalls due to safety issues, and the ongoing transition towards electric vehicles.

Governance Concerns Raised

The re-election of Akio Toyoda comes at a time when shareholders and governance experts are increasingly vocal about several concerns:

Board Independence

One of the primary concerns is the lack of independent directors on Toyota’s board. A board with a significant number of independent directors is crucial for ensuring unbiased decision-making and preventing conflicts of interest. Critics argue that Toyota’s board is overly dominated by insiders and family members, which may hinder objective oversight.

Transparency and Accountability

Another major issue is the level of transparency and accountability within the company. Stakeholders have expressed concerns about the adequacy of Toyota’s disclosures regarding its decision-making processes and the performance of its board. There is a call for more detailed reporting on governance practices and the rationale behind key decisions.

Succession Planning

Effective succession planning is critical for the long-term sustainability of any organization. Concerns have been raised about Toyota’s succession planning processes, particularly given the significant influence of the Toyoda family. Shareholders are questioning whether the company has a robust plan in place to ensure a smooth transition of leadership when the time comes.

Shareholder Response and Voting Outcomes

Despite these governance concerns, the majority of shareholders voted in favor of re-electing Akio Toyoda as chairman. This decision reflects a combination of factors:

Leadership Continuity

Many shareholders believe that Toyoda’s leadership has been instrumental in navigating Toyota through various crises and maintaining its competitive edge in the automotive industry. His deep understanding of the company and its culture is seen as a valuable asset.

Financial Performance

Toyota’s strong financial performance under Toyoda’s leadership has likely influenced shareholder sentiment. The company has consistently reported robust earnings and maintained a strong balance sheet, which provides a degree of confidence in its current leadership.

Strategic Vision

Toyoda’s strategic vision, particularly in advancing Toyota’s initiatives in electric and autonomous vehicles, has garnered support. His efforts to steer the company towards a more sustainable and technologically advanced future resonate with many stakeholders.

Comparative Analysis of Governance Practices

Aspect	Toyota	General Best Practices	Analysis
Board Independence	Limited number of independents	Majority independent directors	Toyota lags behind in board independence, raising concerns about objectivity.
Transparency	Moderate	High transparency and detailed reporting	Toyota needs to enhance its transparency to meet best practices.
Succession Planning	Family-dominated	Clear, merit-based succession plans	The reliance on family leadership is seen as a potential risk.
Shareholder Engagement	Limited	Regular and detailed engagement	Improved shareholder engagement could address governance concerns more effectively.
Leadership Continuity	Strong under Toyoda	Balanced with governance checks	While leadership is strong, it should be balanced with better governance frameworks.

Comparative Table: Toyota vs. Industry Peers

Company	Board Independence	Transparency	Succession Planning	Shareholder Engagement	Leadership Continuity
Toyota	Moderate	Moderate	Family-dominated	Limited	Strong
General Motors	High	High	Merit-based	Extensive	Strong
Ford	High	High	Merit-based	Extensive	Strong
Volkswagen	Moderate	Moderate	Merit-based	Moderate	Strong
Honda	Moderate	Moderate	Merit-based	Moderate	Strong

Recommendations for Enhancing Governance

To address the governance concerns and align more closely with best practices, Toyota could consider the following recommendations:

Increase Board Independence

Enhancing the independence of the board by appointing more independent directors could improve oversight and decision-making. This would help ensure that the board can provide unbiased guidance and hold the executive leadership accountable.

Enhance Transparency

Improving transparency through detailed and regular reporting on governance practices and decision-making processes can build trust with shareholders and other stakeholders. Clear disclosure of the rationale behind key decisions and the performance of the board would be beneficial.

Strengthen Succession Planning

Developing a more robust and transparent succession planning process is crucial. This should involve identifying and grooming potential leaders from within the company based on merit rather than familial ties. A clear succession plan would provide stability and reassure investors about the company’s future.

Improve Shareholder Engagement

Engaging more effectively with shareholders through regular updates and open dialogues can help address their concerns and incorporate their feedback into governance practices. This proactive approach can enhance shareholder trust and support.

Conclusion

The re-election of Akio Toyoda as chairman of Toyota amid governance concerns highlights the complex interplay between leadership continuity and the need for robust governance frameworks. While Toyoda’s leadership has been pivotal in guiding Toyota through challenging times and maintaining its competitive edge, the company must address the governance concerns raised by shareholders and experts. By increasing board independence, enhancing transparency, strengthening succession planning, and improving shareholder engagement, Toyota can build a more resilient and sustainable governance model that supports its long-term success.

Analysis Table

Issue	Current State at Toyota	Recommended Improvement	Expected Outcome
Board Independence	Limited number of independents	Increase independent directors	Improved oversight and decision-making
Transparency	Moderate	Enhance transparency and reporting	Increased trust and accountability
Succession Planning	Family-dominated	Develop a merit-based succession plan	Stable leadership transition
Shareholder Engagement	Limited	Improve regular and detailed engagement	Better alignment with shareholder interests
Governance Framework	Needs strengthening	Adopt best practices in governance	Enhanced corporate governance and sustainability

By addressing these key areas, Toyota can align itself more closely with global best practices, ensuring that it remains a leader not only in the automotive industry but also in corporate governance.

Author

Harry Williams

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Autos & Vehicles

The Future of Hands-Free Driving: Safety Insights from GM’s Mark Reuss

Published

3 months ago

June 16, 2024

Jen Sanders

Reviewed
By Carlos Clark

The Future of Hands-Free Driving: Safety Insights from GM's Mark Reuss

A Message from General Motors President Mark Reuss

Advanced driver assistance technology and fully autonomous vehicles are no longer just concepts of the future—they are present on our roads today. GM Mark has been at the forefront of this technological revolution, having introduced the world’s first truly hands-free driver assistance technology, Super Cruise, in 2017. Today, General Motors President Mark Reuss continues its mission to advance hands-free driving for consumers while also pursuing fully autonomous driving through its collaboration with Cruise.

The Importance of Safety in Autonomous Vehicle Deployment

GM Outlines Plans To Capitalize On Future Of Personal Mobility

Image by : Yandex

As fully driverless vehicles become more prevalent, particularly in ride-hail services like those in San Francisco, safety remains paramount. General Motors prioritizes the safe development and deployment of both advanced driver assistance systems (ADAS) and fully autonomous vehicles (AVs). This dedication is crucial to earning and maintaining the trust of consumers, many of whom, according to a recent Pew Research Center survey, are cautious about the readiness of driverless cars.

GM’s Commitment to Zero Crashes

At GM Mark, the overarching goal is to eliminate human driver error, thus reducing the number of crashes. This vision extends beyond merely creating safe driving conditions; it aims to enhance mobility for those who are currently unable to drive due to age, disability, or other factors. GM’s Mark focus on testing, validation, and improvement of hands-free driving technologies underscores this commitment.

Key Areas of Focus for Safe Hands-Free Driving

Rigorous Testing and Validation

The cornerstone of GM’s hands-free technology deployment is its robust testing and validation processes. By leveraging both virtual simulations and real-world driving scenarios, GM Mark ensures that Super Cruise is thoroughly assessed and refined before reaching customers. This meticulous approach helps in anticipating and addressing various driving situations, thereby enhancing safety and reliability.

Comprehensive Sensor Integration

Super Cruise employs a suite of sensors, including real-time cameras, radars, GPS, and LiDAR mapping, which work together through sensor fusion. This integration creates a sensory field around the vehicle, helping to maintain lane positioning and improve the driver’s comfort and convenience during hands-free driving.

Driver Attention Systems

Image by : gm.com

An industry-first, GM’s driver attention system monitors the driver’s head position and gaze, providing visual and audio alerts to ensure the driver is attentive and ready to take control if necessary. This system includes multiple escalation levels to ensure the driver’s awareness and responsiveness, enhancing overall safety.

Collaboration and Consumer Education

Monitoring and Collaboration with Public Sector

GM Mark collaborates with local Departments of Transportation to keep its mapping data current and to monitor road conditions, including construction zones. This collaboration helps maintain the accuracy and reliability of Super Cruise’s navigation capabilities.

Educating Consumers and Stakeholders

Consumer education is vital to fostering comfort and confidence in hands-free vehicle technology. GM Mark invests significant resources in educating not only its customers but also policymakers and community leaders about the safe use and benefits of these advanced technologies.

Achievements and Future Goals

GM’s dedication to safety and continuous improvement is evident in its milestone of more than 70 million hands-free miles driven with Super Cruise. The company continues to analyze data, refine technologies, and evolve its systems to ensure they meet the highest safety standards before reaching the market.

Conclusion

Mark Reuss, President of General Motors, emphasizes the importance of building consumer trust through safe deployment practices. GM Mark is committed to integrating safety into every aspect of its driver assistance and autonomous driving programs, aiming to unlock success and safety for all drivers. The future of driving is exciting, and GM is leading the way by ensuring these innovations are both groundbreaking and safe.

GM’s focus on rigorous testing, advanced sensor integration, and comprehensive driver attention systems ensures reliable and secure technology. With milestones like Super Cruise achieving over 70 million hands-free miles, GM Mark is committed to eliminating driver error and enhancing mobility for all, while educating consumers and stakeholders about the benefits and safety of advanced driving technologies.