Local autonomous vehicle regulations: A road less regulated

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  Quantumrun Foresight
• November 13, 2023

Insight highlights

Autonomous vehicle (AV) regulation in the US is in its early stages, with Michigan leading by passing a specific law for connected and automated vehicles (CAVs). The lack of comprehensive laws means traditional vehicle and liability laws apply to AVs, requiring legal adaptations for assigning responsibility in AV incidents. This regulatory landscape, evolving with local laws, may shape usage habits, spur industry changes, and influence technological advancements while posing challenges of ensuring equitable access and managing safety concerns.

Local autonomous vehicle regulations context

As of 2023, a detailed regulatory framework specifically for autonomous vehicles (AVs) has not been established at the US federal or state level. Passenger vehicle safety is typically governed under a dual federal-state system. The National Highway Traffic Safety Administration (NHTSA), directed by Congress, oversees motor vehicle testing. It also enforces adherence to these standards, handles safety-related defect recalls, and co-regulates with the Environmental Protection Agency (EPA) on fuel economy and emissions issues.

Meanwhile, the National Transportation Safety Board (NTSB) can probe vehicular accidents and suggest enhancements in safety, though its main focus is on civil aviation, railways, and trucking. Traditionally, states have also played a significant role in road safety by issuing driver's licenses, registering vehicles, carrying out safety checks, formulating and enforcing traffic laws, building the safety infrastructure, and regulating motor vehicle insurance as well as liability for accidents.

However, in 2022, Michigan became the first US state to pass a law on deploying and operating roadways for CAVs. The law grants the Michigan Department of Transportation (MDOT) the ability to assign specific routes for AVs, form partnerships with tech companies for their management, and impose usage charges if necessary. Nonetheless, this development is considered slow, considering that the European Union (EU) approved a legal framework for fully automated vehicles in July 2022.

Disruptive impact

Given the limited rules so far, makers of highly automated vehicles (HAVs) have a lot of freedom to decide how to handle any possible legal responsibilities. Without more detailed rules from the government or states, traditional state laws will usually apply to any legal issues from accidents involving HAVs. Courts will need to consider whether these laws need to change to suit HAVs with different levels of automation.

Under the law, if someone is injured, they have to show that the person they're suing failed in a duty they owed them, which caused injury and damage. In the context of HAVs, it's unclear who should be responsible. Usually, drivers are held accountable for car accidents unless there's a technical issue with the car. 

But if no driver controls the vehicle, if the car isn't kept in good condition, or if the driver can't take back control when needed, the driver might not be at fault in many accidents. Indeed, the long-term aim of HAVs is to take the driver out of the equation, as drivers reportedly cause 94 percent of accidents. Early guesses suggested that the main rules about the legal responsibility of HAV makers, providers, and sellers will be based on manufacturing, design, or warning defects. Injured people can be expected to include, when possible, claims for fraud and misrepresentation. 

Implications of local autonomous vehicle regulations

Wider implications of local autonomous vehicle regulations may include: 

• People relying more on shared autonomous vehicles rather than owning personal cars to minimize their risk exposure. 


• New job opportunities in AV insurance underwriting, remote monitoring and maintenance of autonomous vehicle fleets, and software development and data analysis roles.


• Governments and local authorities establishing frameworks for testing, licensing, and regulating autonomous vehicles. This process can involve complex negotiations with technology companies, transportation stakeholders, and labor unions, as well as addressing safety, liability, and privacy concerns.


• Elderly individuals or people with disabilities, who may face mobility challenges, benefiting from increased access to transportation services. However, there may also be concerns about equity and accessibility, as some communities may have limited access to autonomous vehicle services due to regulatory constraints.


• Technological advancements in sensor technology, connectivity, and artificial intelligence. These regulations may encourage research and development in autonomous vehicle systems, leading to improved safety features, better energy efficiency, and enhanced overall performance. 


• Regulations influencing the adoption of specific communication standards, infrastructure requirements, and cybersecurity measures.


• AVs being required to be more energy-efficient, reducing fuel consumption and emissions. Additionally, with the rise of shared autonomous fleets, there can be a decrease in the overall number of vehicles on the road, leading to reduced traffic congestion and lower pollution levels.

Questions to consider

• If you own a connected or semi-autonomous vehicle, what are your local regulations regarding these vehicles?


• How can automakers and regulators work together to establish comprehensive laws on HAVs?