Google: 76 million self-driving cars will be sold by 2035

Google is taking its autonomous R&D into production

Google's parent company Alphabet GOOG said Tuesday it would be spinning out its driverless-car technology from a research unit into a business unit, a signal the technology is getting closer to commercial viability.

The business unit will be called Waymo.

This is just the latest news during a time when auto makers have increasingly turned to Silicon Valley to develop self-driving car technology. In March, General Motors GM, +0.70% bought Cruise Automation, a self-driving technology startup, for $1 billion, and in May, Fiat Chrysler FCAU, +1.89% entered into a deal with Alphabet to develop self-driving Pacifica minivans.

Additionally, the rise in popularity of services like Uber and Lyft have affected the need for car ownership in urban and semiurban areas, making it easier for drivers to consider giving up the wheel altogether.

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About 21 million self-driving cars are expected to be sold world-wide in 2035 alone, with an estimated 76 million vehicles with self-driving capacity on the road through that time, according to estimates earlier this year from automotive research firm IHS Automotive.

Despite heavy investment in the technology, consumers haven't been as quick to jump on the self-driving train. Almost half of American drivers don't want any self-driving features on their car, primarily out of safety concerns.

However, as the technology becomes more prevalent and its safety compared with human drivers is proven reliable, experts expect that drivers will embrace self-driving cars. The U.S. will be the first country with self-driving cars on the road, according to IHS Automotive, beginning in 2020. These cars will have to be able to share the road with the 250 million human-operated vehicles, as well as enter into a market where product turnover is slow — vehicles in the U.S. stay in operation for about 11 years, on average.

Additionally, government regulations and data collection protocols will have to develop alongside self-driving technology in order for these estimates to be realized, IHS Automotive said. Even the car insurance industry must prepare to adapt to the new automotive landscape.

"Those who don't adjust to a changing world will unfortunately be left behind, or will at least face a very different industry," said Jeremy Carlson, principal analyst at IHS Automotive, in a statement. Kathleen Burke/Marketwatch