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Håkan Samuelsson, President of Volvo Cars, has said his company would take on any insurance liability around autonomous vehicles it produces.

By Jeff Sanford

Toronto, Ontario -- October 15, 2015 -- A collection of interesting goings-on in the auto world from the past week:

- The VW scandal continues to generate some interesting knock-on effects. VW, of course, was caught cheating on emissions tests. The scandal has focused attention on emissions testing in general. There is some really dirty, exhaust-stained laundry being aired.

Consider the case in the UK where the environmental organization Greenpeace is pointing out that the government emissions testing agency has, basically, been captured by the auto industry. A UK news report points out that, according to Greenpeace, the government agency responsible for emissions testing has received more than £80 million from the auto industry over the last decade. That’s $159 million CAD. The Vehicle Certification Agency (VCA) is the part of the Department for Transport that does the testing. According to Greenpeace, the agency has become dependent on revenue from car companies to balance its books; key staff, including its chief executive, come from vehicle manufacturers. Under guidance from conservative politicians the agency has been “commercialised” as revenue from approvals has risen from 52 percent of income in 2005 to 70 percent last year. The agency has become a profit center for the government and bills itself as "the chosen supplier of approval services to most major global auto manufacturers" while operating as a “multinational business with offices in countries including Japan, America, Australia, China, India and Italy.” Why a British regulatory agency would have offices in other countries is a deeply fascinating question.

- Mercedes-Benz, Honda and Mitsubishi are also alleged to have sold vehicles that emit significantly more pollution on the road than during laboratory tests. Mileage claims on the part of auto makers are also attracting attention. It has been pointed out that the gap between real mileage rates and rates publicized by auto companies has been rising for years. Critics are also pointing out that few governments are measuring pollution in real-world conditions. Here in Canada, Ontario is the only province with mandatory emissions testing for cars. The Automobile Protection Association (APA) recently complained that emissions testing program simply reads computer data. There is no actual measuring of real emissions. It’s tough to see how the government can continue to charge consumers to do this.

Some good news for VW: According to the APA, “Owners of the new 2015 2L diesel with the AdBlue exhaust cleaning injection system can likely meet current air quality standards with little or no loss of performance and economy.”

- Some notes from the emerging world of automated vehicles (AVs). Håkan Samuelsson, President and CEO of Volvo Cars, said his company would take on any insurance liability around AVs it produces. That is, auto insurance would be rolled into the price of an AV. This is something Google has suggested as well.

Samuelsson also said noted that the US is in the lead in developing AV cars. Unlike Europe, the US can avoid creating a patchwork of laws on AVs as happened in the EU. Playing catch-up on the creation of AV testing rules is Ontario, which only announced this week it will allow AVs to be tested on some roads in the province. The announcement comes long after other regions announced similar rules.

Nissan's head of autonomous-car research suggested the evolution of AVs will see a range of levels of driver control, what he called "sliding autonomy." Sometimes people will want to take the wheel. Sometimes drivers will want to let the car drive. There will be a range of levels of autonomy in-between these two poles.

Another prediction on AVs: The first application will be in long-haul trucking and cargo transportation, not human transportation. Other early adoption of AVs will be in controlled environments such as college campuses or office parks, where environments are particularly controllable.

- Newly minted auto-recycling conglomerate Fenix Parts is getting on track with an acquisition program.The company recently made a couple of acquisitions, among them Tri-City Auto Salvage in Greensboro, North Carolina and Butler Auto Sales and Parts in Forest City, North Carolina. Zacks has since upgraded shares of Fenix Parts from a “sell” rating to a “hold” rating. In other good news, Fenix CEO Robertson purchased 10,000 shares of Fenix Parts stock. Insider buying of shares is generally considered a good sign of confidence in a business.

- Saskatchewan Government Insurance (SGI) has announced that safer driving by provincial motorists has led to fewer injuries and fatalities on Saskatchewan roads. In a press release SGI claim that “safer driving” has led to 19 per cent fewer fatalities and 18 per cent fewer injuries in the past year. The cause, according to SGI, are “tougher traffic safety laws.” New traffic law changes in Saskatchewan took effect as a result of recommendations made by an all-party Special Committee on Traffic Safety.

“Early numbers indicate your safe driving has saved 30 lives and prevented more than 1,200 injuries,” said Don McMorris, the Minister Responsible for Saskatchewan Government Insurance (SGI). The goal of the program is a 10 per cent reduction in fatalities and injuries in the province by Saskatchewan Day 2015, and a 20 per cent reduction by Saskatchewan Day 2017. On average, 158 people were killed and nearly 6,900 people were injured in traffic collisions each year in Saskatchewan prior to implementation of the new traffic laws. Although SGI anticipates the numbers will increase slightly, there have been 128 fatalities and about 5,600 injuries reported as of October 1, 2015.

- A new survey from Esurance finds that half of Albertans “don’t fully understand all aspects of their auto insurance policy” and about one-third want to manage their insurance online. The survey found that more than half of Albertans are already using the Internet to shop for auto insurance; however, according to the survey, a gap exists between shopping for a quote and being able to manage insurance online. That is, it’s easy to get a quote online. It’s harder to change a policy or manage an insurance account. More than half of those surveyed, 54 percent, would like to interact with their insurance provider online for reasons of “convenience, cost and simplicity,” according to the Esurance press release. More than two-thirds of those sampled admit to “feeling in the dark about their auto insurance.” The survey also revealed that less than half (46 percent) feel they understand all aspects of their auto insurance policy and almost the same amount (44 percent) “have no idea how a driving infraction or accident would affect their rates.”

 

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