Autonomous driving technology is set to dominate the CES trade show this week as automakers and investors shift focus away from electric vehicles and toward artificial intelligence-powered systems that could define the industry’s next revenue stream.
After years of heavy spending on EVs, many carmakers are now rethinking their strategies amid weaker demand, policy changes, and rising costs. In contrast, suppliers and startups are arriving at CES ready to showcase advances in autonomous driving technology, betting that artificial intelligence (AI) can succeed where electrification has slowed.
“This year you will see more and more focus on AI and autonomous,” said C.J. Finn, U.S. automotive industry leader at PwC. He added that how companies use AI to safely deploy driverless cars will be closely watched by investors and regulators alike.
Automakers Step Back From Electric Vehicles
CES, once known mainly for TVs and consumer gadgets, has become a major stage for automakers in recent years. But the tone has changed.
A pullback on EV-friendly incentives and policies by the Trump administration has dampened demand and forced automakers to cancel or delay new launches. As a result, most major automakers are not introducing new EVs at CES this year, a sharp break from recent shows.
The shift comes after billions of dollars in write-offs tied to changing EV plans, leaving companies cautious about new capital investments.
Money Shifts Toward Autonomy
Despite past setbacks, interest in self-driving vehicles is returning. Tesla’s limited robotaxi service in Austin and continued expansion by Alphabet’s Waymo (GOOGL) have renewed optimism across the sector.
Driver-assist features such as hands-free highway driving and automatic lane changes are also improving. Some automakers, including Rivian, aim to move toward “eyes-off” driving and autonomous systems on city streets.
“That’s starting to align with where people are putting forward their money,” Finn said.
Cost Pressures Remain a Key Concern
Even as autonomy gains momentum, cost remains a central issue. Automakers are absorbing higher costs from tariffs on auto and auto parts imposed by U.S. President Donald Trump, rather than passing them on to customers, squeezing margins.
Tech leaders including Nvidia (NVDA) CEO Jensen Huang and AMD (AMD) CEO Lisa Su are among the headline speakers at CES, underlining how deeply AI now cuts across industries beyond autos.
“The main theme we expect to see is cost and cost competitiveness,” said Felix Stellmaszek, global automotive leader at Boston Consulting Group.
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