This research presents a novel simulation model that shows the dynamic and complex nature of the innovation system of vehicle automation in a quantitative way. The model looks at the system of automated vehicles from a functional perspective and therefore categorizes vehicle automation into six different levels. Each level is represented by its own fleetsize, its own technology maturity and its own average purchase price and utility. These components form the core of the model. The feedback loops between the components form a dynamic behavior that influences the diffusion of automated vehicles. The model can be used with different datasets and can be enriched with new data in the future. Policymakers and the industry can use the model with their own dataset to gain insight in the speed and direction of the diffusion of automated vehicles.