Week 4 of 8
November 22, 2019
January 1, 2030, New York City announces 100% adoption of all electric autonomous vehicles. Who are the Autonomous Vehicle winners and losers in this situation? Self driving vehicles are with out a doubt the most exciting, controversial and risky venture that will advance transportation in the next decade. Proponents are fascinated by the technology, societal benefits and the potential $7 trillion marketplace that could arise. This blog will explore a world where AV’s work. First, by helping you understand the technology and safety, then look at those who will benefit and finally those who may lose.
Technology and Safety
It all began with a DARPA challenge in 2004 and 2005. The challenge was a success in its second year and sparked what is now the reality of autonomous vehicles. The technology behind Autonomous Vehicles is a creative combination of things that already exist. The list of autonomous vehicle technologies include radar, sensors, camera’s, lidar, microphones, and microchips with AI, machine learning, and customized software to manage and interpret data. The end result will be trucks and vehicles that can drive 50,000+ miles per year. Many argue that long-haul trucks will commercially enter the market first.
There is no doubt that eliminating drivers who are intoxicated, distracted or fatigued will absolutely make roads safer. The biggest danger of Autonomous Vehicles at scale is pre-mature market entry before the technology is ready. Uber has become the example of moving too fast into this space. Can we trust companies to do the right thing? If we use aerospace as precedence, probably not. A recent example is government interaction to ground 737 MAX airplanes. Boeing was not able to make that decision on their own. Will cities create “ground traffic control” similar to air traffic control? Is government the key to success for AV’s or a roadblock?
Winners and Losers
Mass Consumers are poised as big winners. Let’s go back to our scenario of NYC going 100% autonomous. The benefits: reduction of air and noise pollution, reduction or elimination of pedestrian injury/death, reduction of traffic, improvement in delivery times, reduction of commute time, parking costs and theoretically overall transportation costs. Individual commuters in AV’s have a comfortable space to work, read, video chat, watch content, play video games even nap. Imagine a family able to nap / sleep on their way home from a weekend getaway, their luggage in a separate vehicle allowing a new kind of stress free travel.
Drivers licenses, parking tickets and traffic violations are big losers in an all AV world. Many cities, especially urban ones are reliant on money collected by traffic violations. What happens if this goes away? Bigger questions than this blog can answer, however we would have to know what that money is spent on. So in the Manhattan scenario, would the police force adapt by re-focusing their resources to deter other crimes or would they eliminate jobs? How would the city react to a loss of $1 billion in traffic related citations? Did you know that much money was generated in just one year in NYC alone?
There are an estimated 4.4 million jobs driving trucks, taxis or ride-share vehicles in the US. Goldman Sachs estimates the elimination of 300,000 jobs per year when AV’s make up 20% of new car sales. Back to our theoretical all AV Manhattan. Truck, taxi and ride share drivers will lose their jobs. This will also create winners. New jobs in AV maintenance will provide skilled labor opportunities that do not exist today. Loading and unloading AV vehicles remain a job (unless robots advance into that space). Construction should generate new jobs to accommodate AV infrastructure growth. What other new jobs do you think will arise in an AV world?
So, who are the Autonomous Vehicle winners and losers? The biggest losers are companies that aren’t taking AV seriously. The biggest winners are those that do. An extreme outcome is that Autonomous Vehicles could be the death of mass consumer car brands. Look at what happened with the digitization of pictures, film and music. From the 1970’s through the late 1990’s large investments were placed in developing Betamax, VHS, CD and DVD technology. Some very smart companies never advanced into pure digital. The companies that are around today made the right choices with digital and are enjoying massive growth. They know that if you make it easy for the end consumer, you win.
Thank you for reading this weeks Blog. Can’t wait to hear your thoughts on AV’s
Next weeks blog focuses on Platforms, Operating Systems and Networks in Transportation– Have Amazon, Google and Apple already won this war or will OEM’s find a way to compete?
Here are some great articles to read on Autonomous Vehicles…….
This article by Shahin Farshchi is an excellent industry over view of winners and losers in a AV world.
Atlantic Article against AV’s
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