Technology is transforming nearly every industry, from healthcare to retail to transportation. Franklin Templeton Investments recently hosted an event examining the race to develop and market autonomous vehicles entitled, “Along for the Ride: Evaluating the Impacts of Self-Driving Cars.” Panelists at the event examined the progress made so far, and the implications of a world of truly autonomous vehicles. Franklin Equity Group’s portfolio managers; James Cross, Robert Rendler and Robert Stevenson, and Aleck Beach, vice president and research analyst, Franklin Templeton Fixed Income Group, took part in the event share their insights.

Rapid advancements in technology such as self-driving cars have the potential over time to change the way we live, work and travel. This evolution is unlocking a myriad of new investment opportunities that we couldn’t even imagine just a couple decades ago—and in companies not traditionally considered part of the technology sector.

Of course “technology” is a broad term. When we consider advancements in technology, we consider three distinct categories: consumer technology (such as mobile handsets), enterprise technology (aimed at companies rather than individuals, for example cloud computing) and industrial technology (including factory automation).

Beyond the automotive industry, which is considered Consumer Discretionary, recent developments in technology have placed the broader transportation industry under the Industrial sector at the start of a multi-decade period of change and opportunity. As transportation is at the forefront of the shift, it’s an area that is undergoing a dramatic overhaul across a variety of fronts, and offers a significant area of investment opportunity for a variety of reasons.

As we consider new technologies, we’re always interested in opportunities that present a dual-use case, both government and commercial.

For most of the early applications in industrial technology, we have found that governments typically make up a large proportion of the customer base and tend to be involved early in the process. The internet, satellite communication, GPS, fiber optics—even commercial flight—all had early government involvement.

While catalysts such as mobility, cloud computing, artificial intelligence and machine learning have brought about fundamental changes in the consumer and enterprise sectors, incumbents in industrial segments such as aerospace, transportation and defense are only now beginning to ask how those technologies could impact their businesses.