The R&D Tax Aspects of Advanced Driver Assist Systems



By , , and


        The auto industry is currently in an innovation race, moving towards developing the next new Advanced Driver Assist Systems (ADAS) to aid drivers with their daily driving schedules. Cars can self park, avoid collisions, and ultimately, drive themselves. Vehicle features such as automatic braking and Adaptive Cruise Control (ACC) makes driving safer and more efficient for the user. The National Highway Traffic Safety Administration (NHTSA), in their comprehensive policy statement issued in 2013, describes the current technology development as follows:

        "America is at a historic turning point for automotive travel. Motor vehicles and drivers' relationships with them are likely to change significantly in the next ten to twenty years, perhaps more than they have changed in the last one hundred years."



The Research & Development Tax Credit

        Many of the private industry and industry supported University R&D efforts will be eligible for Federal Research and Development tax credits.

        Enacted in 1981, the Federal Research and Development (R&D) Tax Credit allows a credit of up to 13% of eligible spending for new and improved products and processes. Qualified research must meet the following four criteria:

  • New or improved products, processes, or software
  • Technological in nature
  • Elimination of uncertainty
  • Process of experimentation

        Eligible costs include employee wages, cost of supplies, cost of testing, contract research expenses, and costs associated with developing a patent. On January 2, 2013, President Obama signed the bill extending the R&D Tax Credit for 2012 and 2013 tax year.



Five Levels of Car Technology

The following levels have been established by the NHTSA, setting level 0 as full driver control to level 4 as complete self-driving control:

Car Levels

The following diagram displays the features of self-driving cars:

Car



The First Steps: Night Vision and Adaptive Cruise Control

        In 2002 Toyota introduced the first night vision equipped vehicle. This was an active night vision system that used infrared light and was available in the Lexus LX470 and Toyota Land Cruiser. It displayed an image of the road ahead on the windshield to help drivers see what the naked eye may not, greatly improving the safety of nighttime driving. Mercedes-Benz was the next company to incorporate this technology into some of its vehicles. The technology then evolved to utilizing passive systems based off infrared radiation emitted by the objects ahead rather than using an infrared light source. Passive systems allowed for greater range of vision. The newer system is now used by a wide range of manufactures including Audi, BMW, General Motors, and Honda.

        The next major innovation after night vision capabilities was Adaptive Cruise Control (ACC). Normal cruise control equipped in most modern cars allows the driver to set one selected speed for the car to maintain. If the traffic ahead slows the driver needs to retain their attention to manage the speed on their own. ACC allows the user to pace their car to the car in front of them while setting a maximum speed limit of their choice. If traffic ahead slows then the drivers car will also slow, while maintaining safe following distance. Some manufacturers even allow for a 'Stop & Go' capability as well. 'Stop & Go' lets the driver keep the ACC on and will even work when in traffic where the only driver input needed is steering. Although not all manufacturers equip the 'Stop & Go' capability, it is still a strong step towards total autonomy of vehicles.

        Combining technologies like night vision and ACC allows for systems within cars themselves to possibly communicate and account for not only other vehicles but pedestrians and animals as well.

        Manufacturer advancements include:

        Ford has built research vehicles with high-resolution unidirectional cameras that can see the road and the surroundings with greater ability than the driver as well as incorporating ACC in to some vehicles.

        Audi utilizes ACC with 'Stop & Go' capability as well as cameras built in the front, back, and sides of the vehicle to detect other vehicles, pedestrians, traffic signs, and a range of roadway information.

        Mercedes-Benz included night vision as well as ACC in recent models and has developed an "advanced driving assist" in its F125 concept last year, but has not confirmed plans for future vehicles.

        BMW incorporated full ACC with 'Stop & Go' in a portion of their current lineup as well as night vision on select 7-series models. New models also have the option of cameras mounted to the front bumper to assist in seeing around low-visibility/blind corners when attempting to enter or cross a street.

        General Motors has expanded their range of ACC capable vehicles as competition in the luxury segment has done.



Future Benefits of Self-Assist Vehicles

        Although completely self-driving vehicles are still in development, many advanced vehicle control systems allow drivers to make more conscious and intelligent decisions on the road. Autonomous cars will have 360 degree sensors, which will eliminate vehicle-to-vehicle miscommunication, preventing cars from crashing. Improved V2V (vehicle-to-vehicle) technology will reduce injuries/fatalities, hospital stays, property damage, and other societal costs.

        Predictions are that by 2020, limited self-driving cars will be available and by 2025, fully automated cars will be on the public market. The "V2V safety technologies have the potential to significantly reduce automobile crash fatalities and injuries on our highways" says Mike Stanton, CEO of Association of Global Automakers. Driverless cars are expected to exponentially reduce highway traffic, and allow increased safety.

The following diagram depicts the navigational process of an autonomous vehicle:

ADA Diagram



An Aging Population and Driver Safety

        According to a North Carolina State University (NCSU) and New Jersey Institute of Technology (NJIT) study the leading cause of injury-related deaths among 65-74 year olds are motor vehicle accidents. An increasing number of individuals are headed into this age for ADAS to protect all drivers. Systems supporting a need, including lane keeping and blind spot notification, are useful in preventing possible collisions.

        When a driver is equipped with a sensory/automated car, he becomes more aware of his environment, which greater prevents any potentially dangerous situations. Auto-manufacturers must make these systems simple and easy for any age group to operate in order to achieve the goals of reducing related incidents. Development of new ADAS and other systems will aid drivers and innovation related to further developing these systems will be eligible for R&D credits.



Emerging Technologies Require Technical Development and Additional Regulations

        NHTSA has set out three categories of vehicle technology concentration that will require substantial product innovation relevant for R&D tax credits. The categories are as follows.

  1. Human Factors Research
    Suitable vehicle controls between the vehicle and driver encompasses:
    • Division of labor and authority: assures that either the driver or vehicle is in control.
    • Transition: transferring adequate control from driver to vehicle and vice versa.
    • Override: Override requirements allow the driver to regain control of an automated system.

  2. Electronic Control Systems Safety
    The following line graph represents the comparison in safety of completely autonomous, sensory and manual vehicles:



    Safe Reliability

    • Functional Safety: Defines the requirements for electronic controls.
    • Failure Modes: Assess the failure severities.
    • Failure Probability: The likelihood of failure to occur.
    • Diagnostics: Enhanced capabilities that can self detect or predict failures of automated systems.
    • Redundancy: Investigating any additional hardware, software, or communications systems may be needed to ensure the safety of highly automated vehicles.
    • Failsafe: Ability to execute even at a dismantled level in case of failure.
    • Certification: Requirements to ensure system's safety at deployment and remain safe.
         Cyber-Security
    • Security: Competency of system to resist cyber attacks.
    • Risks: Possible gaps in system compromised by cyber attacks.
    • Performance: Effectiveness of system.

  1. Develop System Performance Requirements
    • Detailed Functional Descriptions: Provides development for new level 2 and 3 operational models.
    • Evaluate constraints on level 2 and 3 system performance.
    • Data Analysis: Evaluate naturalistic and crash data to determine an array of real-world situations.
    • Develop of test and evaluation requirements methods based on real world situations.
    • Determine the performance and operating envelope for new level 2 and 3 systems. These systems include: maximum deceleration authority, maximum lateral velocity, maximum yaw moment, and other vehicle properties.
    • Develop objective performance tests and pass/fail standards.



R&D Tax Credits are Available to Support this Major Technology Leap

        Innovative new automotive technologies are being introduced to assist drivers and automate the driver experience as a whole. Federal and state R&D tax benefits are available and intended to encourage this high level of technological innovation.

Article Citation List

   


Authors

Andrea Albanese is a Project Manager with R&D Tax Savers.

Charles G Goulding is the Manager of R&D Tax Savers.

Christopher Zalesky is a Tax Analyst with R&D Tax Savers.


Similar Articles
The R&D Tax Credit Aspects of Blockchain for Supply Chains
The R&D Tax Credit Aspects of Physical Security Technology
The R&D Tax Credit Aspects of Mechatronics
The R&D Tax Credit Aspects of Driverless Cars
The R&D Tax Credit Aspects of SaaS Start-Ups
The R&D Tax Credit Aspects of Emotion-Recognition Technology
The R&D Tax Credit Aspects of AI in the Insurance Industry
The R&D Tax Credit Aspects of Emerging AV Trends
Enhanced R&D Tax Credits for Specialized Co-Shared Spaces
Ethereum's Impact on Digital Contracting Creates R&D Tax Credit Opportunities
The R&D Tax Credit Aspects of Geofencing
The R&D Tax Credit Aspects of Distribution Center Automation
The R&D Tax Credit Aspects of Artificial Intelligence in Fintech
The R&D Tax Credit Aspects of Law Firm Artificial Intelligence
The R&D Tax Credit Aspects of Avionics
The R&D Tax Credit Aspects of Boeing's Manufacturing Process and Supply Chain
The R&D Tax Credit Aspects of Chemical Engineering Post Dow-DuPont Merger
The R&D Tax Credit Aspects of Telemedicine
State & Local Tax Jurisdictions Address Media Streaming and Cloud Services
Federal Government Provides Faster Approvals and Tax Credits for Consumer FinTech Products
The R&D Tax Credit Aspects of Voice-Activated Software
The R&D Tax Credit Aspects of Artificially Intelligent Hedge Funds
The R&D Tax Credit Aspects of LiDAR
The R&D Tax Credit Aspects of Educational Technology (EdTech)
Bicycle Designers & Manufacturers Obtain R&D Tax Credits for Innovation
Machine Shop Innovation and R&D Tax Credits
The R&D Tax Credit Aspects of Cyber Security Start-Ups
The R&D Tax Credit Aspects of Construction Industry IoT
R&D Tax Credits Provide New Opportunities for Artificial Intelligence Start-Ups
The R&D Tax Credit Aspects of NYC Start-Ups
The R&D Tax Credit Aspects of Domestic Fast Fashion
The R&D Tax Credit Aspects of Virtual Reality Technology
The R&D Tax Credit Aspects of Water Analytics
Matching Drone Regulations and U.S. R&D Tax Credits
The R&D Tax Aspects of Artificial Intelligence Robo-Advisors
The R&D Tax Credit Aspects of Natural Language Processing (NLP) Innovation
Providing Advice for the Robot Purchase Decision
The R&D Tax Credit Aspects of Video Compression Technology
The R&D Tax Credit Aspects of Precision Farming and Agricultural Robotics
The R&D Tax Credit Aspects of Automated Coding
The R&D Tax Credit Aspects of Payment Technology
The R&D Tax Credit Aspects of Restaurant Technology
R&D Tax Credits and the Second Wave of Cloud Adoption
The R&D Tax Aspects of Data Storage Startups
The R&D Tax Credit Aspects of Cyber Security
The R&D Tax Credit Aspects of Mobile Applications
R&D Tax Credits for the Modern Insurance Industry
The+R%26D+Tax+Credit+Aspects+of+the+Internet+of+DNA
The R&D Tax Credit Aspects of Modern Dental Labs
The R&D Tax Credit Aspects of IoT Communication
The R&D Tax Credit Aspects of Bitcoin and Blockchain Technology
The R&D Tax Aspects of Near Field Communication
The R&D Tax Credit Aspects of STEM Building Design
Kickstarting Federal and State R&D Tax Credits
The R&D Tax Aspects of the New FDA Mobile Apps Requirements
The R&D Tax Aspects of the Baxter Robot
Tapping the Power of Big Data and R&D Tax Credits for Utility Companies
National Innovation Priorities - How the 2014 Federal R&D Budget and R&D Tax Credits Integrate
The R&D Tax Credit Aspects of the Medical Software Industry
The R&D Tax Aspects of Computer Enabled Human Identification
The R&D Tax Credit Aspects of the Packaging Industry
The R&D Tax Credit Aspects of the Plastic Manufacturing Industry
The R&D Tax Credit Aspects of New York City's Engineering Education and Googlization
R&D Tax Credits for the High-Risk Battery Business
The R&D Tax Credit Aspects of Software Modeling Analytics
The R&D Tax Credit Aspects of Logistics Software and Process Innovation
The R&D Tax Aspects of Cameras of the 21st Century
The R&D Tax Credit Aspects of Network Security
R&D Tax Aspects of DNA Identification
R&D Tax Credit Aspects of Cyber Security and Homeland Protection
Financial Product Trading Platform Artificial Intelligence R&D Tax Credits
The R&D Tax Credit Aspects of Industrial Design
Gig City Startups and R&D Tax Credits
The R&D Tax Credit Aspects of a Nondysfunctional Airline Industry
The Internet of Things Creates R&D Tax Credit Opportunity
The R&D Tax Credit Aspects of Mobile Banking Applications
R&D Tax Credit Aspects of Drone Commercialization
The R&D Tax Credit Aspects of In-Image Advertising
R&D Tax Credits for Hybrid Call Centers - Airline, Hotel, and Car Rental Industries
The R&D Tax Aspects of Advertising Science
The R&D Tax Aspects of Data Science
R&D Tax Aspects of Radio Frequency Identification
The R&D Tax Aspects of the U.S. Textile and Apparel Renaissance
The R&D Tax Aspects of the Internet of Residential Things
The R&D Tax Aspects of Web Television
R&D Tax Credit Aspects of Massachusetts Robotics Cluster
R&D Tax Credit Aspects of Medical Robotics
R&D Tax Credit Aspects of Industrial Robotics
R&D Tax Credit Aspects of Service Robotics
Yes Alice, Patents and R&D Tax Credits Remain Available for the Internet of Things!
How Salesmen Can Use R&D Tax Credits to Sell Today's Software Products Engagements
The R&D Tax Aspects of Cloud Computing
The R&D Tax Credit Aspects of Hybrid Call Centers for Health Insurers
The R&D Tax Credit Aspects of Food Processing Robots
R&D Tax Credit Opportunities for the Utility and Auto Industry's Common Needs
Now Every Business is a Software Business
The Robot Revolution and Tax Policy
The R&D Tax Aspects of Collaborative Robots
The R&D Tax Aspects of Robot Software
The R&D Tax Aspects of Machine-to-Machine (M2M) Innovation
The R&D Tax Aspects of Financial Technology Services
Beacons Create R&D Tax Credit Opportunity
Fast Growth of Sharing Economy Impacts Tax Reporting
The R&D Tax Credit Aspects of Robotic Warehouse Automation
The R&D Tax Credit Aspects of Retail Technology
The R&D Tax Credit Aspects of Improving Virtual Reality Technology
The R&D Tax Credit Opportunities for Mobile Devices
The R&D Tax Credit Aspects of the Gun Manufacturing Industry
Process Improvement Research & Development Tax Credits
The R&D Tax Credit Aspects of Wearable Technology
The R&D Tax Aspects of Big Data
How Lean New Business Startups and R&D Tax Credits Integrate
R&D Tax Credit Fundamentals
Los Angeles Tech Boom Creates Large R&D Tax Incentive Opportunities
The R&D Tax Credits and the U.S. 3D Printing Initiative
R&D Tax Credit Aspects of the U.S. Manufacturing Renaissance
The R&D Tax Aspects of Software Development
R&D Credit Opportunity for Smart Sensors
The New R&D Tax Credit Scenario
Rapid Robot Technology Advancements Supported by R&D Tax Credits