The insurance issue seems to be the main hurdle. Insurance companies are good at lobbying and won’t be happy to have a profit/revenue stream dry-up due to shifting accident statistics. Perhaps insurance corporations just bring out my cynical side.

Imagine paying the extra $10k up front for the car, with a guaranteed savings on insurance of $500/year, and drastically reduced gas costs (I cant’ imagine less than a 10% average improvement) since the car will optimize for efficiency. Oh, and never needing to drive yourself!

I’d guess that this will be a luxury feature at first, so that the companies that roll it out first could be the high-end market, which will allow for time to reduce costs. As tech prices drop, the market becomes used to them, and the advantages become clear, it will become standard within 10 years of introduction.

I also suspect that the regulatory portion will be strict, uneven, and handled by the states, at least at first, until the car manufacturers see that it is costing them money. Then things will change as it becomes widespread, and seen to be unnecessary.

Lastly, I expect car ownership to dissapear as a touchstone. Fractional ownership will be cheaper, and just as good. Why buy when you can have a car on demand, driving itself to pick you up, and only pay for usage. Driveless taxis, and seamless carpooling will hopefully follow soon after – Think door-to-door subways without tracks, for less than the price of a bus ride – no overhead for drivers, and less capital intensive networks.

Also, I think that self driving cars will come with a stricter regulatory regime, a la the airline industry. Today’s airliners can perform hands off flights to zero visibility landings and roll outs if they’re properly equipped, but there are also fairly strict regulations about how often the equipment must be checked, its ability to self detect faults, and other things, as well as mandatory recurrent training. I don’t think this would fly with most people, because it would be too inconvenient, nor would it be necessary (you’re not flying 400 people at 150 knots into the ground). Nonetheless, I wouldn’t be surprised if they mandated that some things could only be inspected by federally licensed mechanics, and these parts would have to inspected every 1000 hours/ 25,000 miles, something like that. It would also curtail the ability of people to modify their cars with lift kits, turbos, etc, because of the changes to vehicle dynamics, I would think.

Nonetheless, I think it would be an awesome step forward.