The UK government is said to be preparing to rewrite the rules of the road in the rush to make it easier for driverless cars to be developed and driven in the UK.
Google's new generation of driverless car, which has no conventional steering wheel, brakes or accelerator, is expected to become legal on California roads as early as September and science minister David Willetts is keen to encourage British designers to develop their own technology to see off the challenge from Google.
"We are one of the world leaders in this," Willetts tells the Daily Mail, "there is technology and it's British technology. The technology is being developed at Oxford as we speak."
In October 2013 it was announced that Milton Keynes would get the UK's first driverless car network, partly because of its wider pavements. From 2015 so-called pods will transport people between the railway station and shopping centre at a stately speed of up to 12mph. Each pod is fitted with sensors to avoid collisions and other pods and can be hailed by using a smartphone app.
Google's version in the US can already be used in some states so long as someone sits in the driver's seat but it is expected this law is about to change in California – which could be a game-changer for the industry. Google says its new cars will "shoulder the entire burden of driving."
"What America is going to have is a legal regime in California that permits you to travel in one without requiring someone in the so-called driver's seat," said Willetts, who has been a fan of the concept since a fact-finding visit to the US in 2012.
"Certainly there are new regulations being drafted in California and obviously this is something I have discussed with the Department for Transport, we are aware of it. We need to work on these type of regulations so that as the technology develops in Oxford and elsewhere we can see them used."
In order to make it easier for designers to test vehicles ministers want to change the Highway Code. A prize fund worth £10 million will encourage a UK town or city to allow itself to be developed as a test site for the vehicles. A new infrastructure plan will also "ensure there is a clear and appropriate regime for the testing of driverless cars that supports the world's car companies to come and test them here."