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Insurance Telematics Europe 2014

06/05/2014 - 07/05/2014, Novotel London West, UK

Telematics, Insurers and the Consumer Collide: Harness ‘Big Data’ to Create Product Differentiation, Engage & Empower the End-User

Telematics: Backing up on backup cameras

Susan Kuchinskas examines the implications for the telematics industry of the delayed ruling on backup cameras in the US

In late February, the National Highway Transportation and Safety Authority (NHTSA) of the United States Department of Transportation said it would put off the final ruling on new safety regulation to help eliminate blind zones behind vehicles that can hide the presence of pedestrians. This is the second delay and moves the delivery date to December 2012, after the US presidential election.

The Cameron Gulbransen Kids Transportation Safety Act of 2007 directed NHTSA to issue a final rule amending the agency’s Federal motor vehicle safety standard on rearview mirrors to improve the ability of a driver to detect pedestrians in the area immediately behind his or her vehicle and avoid hitting them.

NHTSA found that approximately 228 deaths each year were caused by backup accidents. In November 2010, NHTSA released its notice of proposed rulemaking, finding that the use of effective technology to prevent backovers could save 95 lives a year and prevent 7,072 injuries.

The cost/benefit analysis is not as simple as $2.7 billion for 95 lives, of course. NHTSA noted that most deaths are of young children who would have contributed to society for decades, while the guilt of a parent who killed a child is equally devastating.

Besides, because this is a legislative effort, the delay is just that. There will inevitably be a mandate for some improvement in the rear view, no matter the cost. (For more on cameras, see Telematics and privacy: The impact of ‘do not track’ proposals.)

Rear-mounted video cameras

NHTSA found that most automobile manufacturers would need to install rear-mounted video cameras and in-vehicle displays to meet the proposed standards. Asking for the delay, the agency said it needed more time to study two issues: changes in camera performance from vehicle to vehicle and from situation to situation, plus the ability of drivers to learn to use the systems effectively.

In independent tests, Consumer Reports found that a car's blind zone can be large enough to hide a small child up to 50 feet away. It also found that video camera systems work better than audible radar systems and also that some cameras took up to seven seconds to turn on after the car was put into reverse, plenty of time to back over a child.

In 2010, the agency said that to meet the requirements of the proposed rule, 10 percent of new vehicles would have to comply by Sept. 2012, 40 percent by Sept. 2013 and 100 percent by Sept. 2014. In fact, thanks to consumer demand, the industry seems to already be ahead of that original goal.

Consumer demand

According to IHS iSuppli, the availability of factory-installed camera park assist has been increasing in the United States for years. The research firm estimates that in 2012, 70 percent of car models in the United States offered this as standard or optional.

"That is a very high number," notes Jeremy Carlson, IHS iSuppli analyst for advanced driver assistance systems. "Those kinds of availability numbers are not that high for any other ADAS." (For more on ADAS, see V2X telematics: Taking ADAS to the next level and Q&A: For V2V Telematics, “Seeing is believing”.)

Following the notice of proposed rulemaking, in January 2011, IHS iSuppli upped its original forecast of 20 percent of all new cars sold in model year 2015 with rear-view park assist cameras to, well, 100 percent, because that was the mandate.

Its previous forecast for that model year was only 20 percent. This would have meant a total of 71.2 million new cars in the United States sold with backup cameras from 2011 through 2017. The research firm has not rejiggered the forecast in light of the delay.

The National Highway Traffic Safety Administration has said that including cameras would add up to $200 to the cost of a vehicle, or a total of $2.7 billion for the auto industry, at least some of which would be passed on to consumers.

Meanwhile sales of aftermarket backup cameras are up, while prices continue to fall, including many do-it-yourself wireless models with screens that mount on the dashboard or rearview mirror.

Wade Newton, spokesperson for the Alliance of Automobile Manufacturers, said the AAM had no comment on NHTSA's delay in ruling, but said that his organization did give some technical feedback and it had questions about whether graphics on the screen might make the camera out of compliance.

"We had urged NHTSA to explore all options," he says. "In some cases, a camera is ideal, but in other cases, you could expand the rearview mirror."

The AAM also was concerned about adding onto the cost of a car. "You never want to add technology to an auto that prices it out of a consumer's range so they can't afford the car," he says, while acknowledging that adding a dashboard screen for NHTSA's top estimate of $200 is feasible.

The infotainment system link

Politics aside, this is a fairly safe mandate for NHTSA, because cameras are already so highly available; auto makers would not have to spend inordinately to boost availability to 100 percent.

"It's more of a shock when they mandate a technology that is available on a smaller portion of vehicles," Carlson says. "When you have a higher rate of availability and are just looking for those last few percent, it is not quite as jarring for the industry."

"Camera sales will incline anyway, no matter what," he adds, especially as in-vehicle infotainment systems proliferate. "You have the display available, so camera park assist is almost an add-on at that point. You can bundle it together with a higher-cost system.

In fact, the mandate could be good for the entire telematics ecosystem—car companies, suppliers and drivers—says Roger Lanctot, associate director in the Global Automotive Practice of Strategy Analytics.

"The mandated option requires a display," he says. "A lot of companies have been very slow to promote, adopt and emphasize the use of the display in the car. This forces them to wrap their heads around having a display in the car."

He says that the cost is a drop in the bucket compared to automakers' profits, and, once the display is ubiquitous, it will allow greater infotainment and ADAS applications. Lanctot adds, "Let's hope these are driving-enhancing and safety applications."

Susan Kuchinskas is a regular contributor to TU.

For more all the latest telematics trends, visit Content & Apps for Automotive 2012 on April 18-19 in Germany, Insurance Telematics Europe 2012 on May 9-10 in London, Telematics Detroit 2012 on June 6-7, and Insurance Telematics USA 2012 in September in Chicago.

For exclusive telematics business analysis and insight, check out TU’s reports on In-Vehicle Smartphone Integration Report, Human Machine Interface Technologies and Smart Vehicle Technology: The Future of Insurance Telematics.

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Insurance Telematics Europe 2014

06/05/2014 - 07/05/2014, Novotel London West, UK

Telematics, Insurers and the Consumer Collide: Harness ‘Big Data’ to Create Product Differentiation, Engage & Empower the End-User