Despite recent setbacks, for some time now, the discussion about the arrival of autonomous cars no longer focuses on whether they will become a reality, but rather – when. From the outside looking in, itÂ feels as if skepticism is greater among the car manufacturers, precisely because they have a lot more to lose in this scenario.
Carlos Ghosn, president of Nissan and Renault, is one of the most prestigious executives in the automotive world. This executive predicts that we will have autonomous vehicles within six years, and is fully aware of the risks facing his sector. In his own words, “the car industry will do everything to make sure that the product does not become a commodity.”
But the manufacturers are not the only ones who stand to lose. Many other groups and industries will be affected by the new technologies.Let’s see some examples.
Steering wheel professionals
We all know that the future for taxi drivers looks bleak, but it doesn’t stop there. The car, logically, is not the only vehicle capable of being autonomous. Think of vans, trucks or buses, where the possible initial extra cost of autonomous technology would be amortized more quickly. In fact, companies like Tesla or Google are working on it and techniques such as platooning show us the potential of autonomous technology.
The same structure of the freight transport sector will change with the arrival of autonomy. Currently, it is very atomized, based largely on the existence of autonomous drivers, many of them owners of their own vehicles. The progressive disappearance of the driver will lead to more companies investing in autonomous transportation.
And the impact on employment can be devastating.According to a report by the International Transport Forum, “automated trucks could reduce the demand of transporters by 50% to 70% in the United States and Europe before the end of 2030, with the consequent disappearance of up to 4.4 million jobs over a forecast of 6.4 million road transport professionals. ”
The current reality today is that the constant growth of electronic commerce brings with it an important demand for drivers associated with logistics work. This demand will continue to be strong until the technology is sufficiently advanced for companies to leave the driver’s side.Â Although autonomous driving will make it unnecessary to have someone behind the wheel, there are other tasks that will still require human presence (at least for a time): handling and checking the cargo, delivery of packages, security, etc.
The problem for car manufacturers is that their future customers, the younger generations, have become frequent users of ride sharing, which will be reinforced with the arrival of fleets of autonomous vehicles.
To this is added a process of increasing urbanization at the global level. AndÂ urban environments are particularly conducive to autonomous cars. The high population density allows a quick amortization of the necessary infrastructure, increasing the profitability of transport services.In addition, in the city the range of situations to which the vehicles could face is very concentrated.
In the words of Dirk Wisselmann, BMW’s autonomous driving expert: “It’s easy to work with urban environments, in 99.9% of the time, you have situations that happen every day. But in the field, you are more likely to have something happen. ”
On the other hand, it can also be argued that the autonomous vehicle can end up favoring dispersion, making the journey between home and workplace more bearable and reducing peak hours. Not to mention the effects on the real estate market.
The means of public transport would not be free from the competition of autonomous vehicles, since they are largely substitute goods. Thus, a mobility service that offers greater personalization and convenience could result in less use of public transport.
Normally, administrative concessions for new transport routes are granted for long periods of time, and the bidding companies are baking these concessions into their financial models. These hypotheses are basic to determine issues such as the price to bid and the profitability of the business.
While short journeys in urban settings seem ideal for autonomous vehicles, being able to make long journeys with greater comfort and privacy and spend the night on the road sleeping could displace other means of transport such as buses, planes, and trains.
The truth is that, under normal conditions, the demand for a good increases when its price decreases. A study by the University of California, Davis on the effects on the behavior of travelers of services such as Uber or Lyft concludes that the total distance traveled by vehicle will probably increase due to the existence of these services.
Moreover, services such as Uber affect all means of transport. According to the same study, between 49% and 61% of trips would not have taken place at all, or would have been done on foot, by bicycle or by public transport, in the absence of such services.
In the future, it is to be expected that the trends pointed out in this study will be consolidated, and the existence of competitive offers by mobility services will lead us to make more intensive use of autonomous vehicles than we do from the options currently available.
The foreseeable reduction of congestion and traffic incidents and the ability to control the status and situation of autonomous fleets could lead to an even greater decrease in the number of people devoted to managing traffic – aka employees in the Dept of Transportation.
Other notable effects:
The consumption of alcohol and drugs behind the wheel is behind many accidents.Â Fleet companies would have a strong incentive to install surveillance and control systems for their own vehicles (cameras, sensors). As a result, information would be generated that would save inspection and investigation time in incidents on and off the road.
The autonomy would affect the insurance business by bringing a drastic reduction in premiums for several reasons:
- Lower probability of loss, by reducing the incidence of the human factor.
- Lower Average value of loss, as there are fewer humans driving.
- Greater negotiation power of the client due to the entry into the market of the fleet companies.
In short, when the profile of drivers (software) is homogenized, companies will be limited in their capacity to discriminate prices to maximize their income. The final result will be a progressive reduction in the size of the market for this category of insurance as the penetration of the autonomous vehicle increases. On the other hand, it would be expected that the cost of non-autonomous vehicle insurance would become more expensive.
What if we have electrical mechanics, less prone to breakdowns due to the lower number of moving parts and with lower maintenance costs?
Plus, the reduction of the number of accidents will be another factor that will contribute to the decline of autobody shops.
The automakers will also be harmed by the disappearance of workshops and the simplification of mechanics, because it will affect the income they receive from official workshops, licenses and sale of spare parts.
We will witness the progressive disappearance of gas stations in urban areas, carrying out the loading or refueling in the fleets’ installations or in self-service kiosks. Another possibility would be to recharge in private homes in a distributed generation scenario.
In interurban areas, the evolution will depend on the advances in autonomy. In addition, autonomous vehicles should suppose a smaller number of breaks in long journeys, which would reduce the convenience of gas stations and service areas.
A decrease in the number of gas stations is not trivial, as it would have consequences for employment in rural areas and small towns
Finally, the autonomous vehicle should not be disregarded as a new advertising platform. Fleet vehicles will probably carry advertising because the focus of travelers will no longer be on the road and they will have time and attention to pay attention to commercial messages. Custom and relevant, of course.
There will also be opportunities
It is evident that totally autonomous vehicles will cause major changes and that employment will suffer in many sectors.Â The popularization of this technology will generate numerous opportunities. The jobs that could be lost could be recovered with the emergence of new activities that we can’t even imagine yet.
The arrival of autonomous driving will most likely involve a significant investment in infrastructure to adapt roads to the needs of new vehicles, at least until they reach a certain level of sophistication. This investment will have a positive effect on employment through several stages: innovation, design, construction and maintenance.
Financially, the change in the ownership model will represent a net gain for individuals, going from paying the full price of an underutilized vehicle to paying for the time of use. And this financial performance being important, at a general level, the main gain derived from the autonomous vehicle will surely be the surplus of available time. Time that we can be devoted to rest, consumption, work, or relaxation.
For companies, the productivity gain derived from having their employees working during their trips is not negligible, but the changes will not be limited to the economic sphere.
Changes are afoot, and as we’ve stated numerous times before, we should not be afraid of the future, but rather, we should embrace it.