Re: Hard decision but Mercedes are probably right
"The car manufacturers will be *terrified* of this second-guessing by the courts, and of course the lawyers will be salivating just thinking about it."
This is an interesting thought.
On the one hand the car will have a perfect record of the event, so if the incident is entirely the other person's fault (e.g. stepping in front of a vehicle moving at legal speed) then the manufacturer should be protected by the law, even the best human driver won't be able to avoid that, and many times won't be able to prove that he was in the right.
On the other hand lawyers and juries, for different reasons, are often eager to punish greedy corporations.
In practice the rate of accidents for autonomous vehicles should be lower, and in almost all cases it should be obvious whether the software did better or worse than a good human driver, so the manufacturers should be able to protect themselves from frivolous and excessive litigation. It may require an additional government agency, similar to the AAIB's role for aircraft accidents (NTSB for USA) to ensure that incidents involving autonomous vehicles are properly investigated and appropriate changes forced on the manufacturers.
There could be a subsidiary issues though, based on software updates to the vehicle. If the manufacturer issues a fix for a problem that the owner refuses to accept (assuming they get a choice) then the owner may be the one liable in any accident that the software update could have avoided; this could mean that insurance for autonomous vehicles requires the owner to accept all software updates from the manufacturer in order to keep the liability with them.