8.3 C
New York
Thursday, March 28, 2024

Study Says by 2030 1/4th of Miles Driven will be Driverless

Courtesy of Mish.

A convergence of three trends – Ride Sharing, Autonomous Driving, and Vehicle Electrification—will offer big-city dwellers cheap, convenient transportation, transforming the automotive industry, says a report by the Boston Consulting group.

The report concludes By 2030, 25% of Miles Driven in US Could Be in Shared Self-Driving Electric Cars.

BCG’s key insight is that the convergence of three trends—ride sharing (services such as Uber and Lyft), autonomous driving, and vehicle electrification—create a far more compelling economic case than any of these forces alone. Due to their ability to cut travel costs by 60%, shared autonomous electric vehicles (SAEVs) could shift about 25% of miles traveled from private automobiles-—creating enormous benefits for consumers as well as causing major disruption to the automotive industry. While total vehicle demand will only be affected slightly, by 2030 more than 5 million conventional cars per year could be replaced by a combination of fully autonomous electric vehicles for urban fleets and partially autonomous cars for personal use. Cities will benefit from less congestion and cleaner air, but could be disadvantaged by falling ridership on public transit, fear of which could result in some cities proactively trying to regulate the number of SAEVs on the road.

“Such an evolution in mobility is no longer a fantasy. The technology exists and our research shows that many consumers will embrace it,” said Brian Collie, a Chicago-based partner who leads BCG’s automotive practice in North America. “Yet few players are taking the bold steps needed to position themselves to thrive in this not-too-distant future. The time to act is now.”

SAEV is an apt acronym for these vehicles, as fleets would save time, money, and lives. By using SAEVs, a typical Chicagoan who owns a car and drives 10,000 miles a year could cut the cost of travel from around $1.20 per mile to around 50 cents per mile. Over the course of a year, that could put more than $7,000 in that driver’s pocket—effectively doubling consumer discretionary income.

Radical Shift Will Be Concentrated in Large Cities

BCG’s conservative estimate is that 23% to 26% of miles driven in the United States, or about 800 billion to 925 billion miles, could be traveled in SAEVs by 2030. The shift to SAEVs, which would be gradual and would begin by the early 2020s, would likely occur in cities with more than 1 million people, where there is sufficient demand to keep fleet utilization high and there are significant pain points associated with private vehicle ownership (expensive insurance, difficulty finding parking, and congestion).

Shift Will Have Massive Impact

While total vehicle demand isn’t likely to change materially, the types of cars required will be vastly different. BCG estimates that in 2030, a total of 4.7 million autonomous electric vehicles will replace 5.1 million conventional autos sold in the US. This shift undermines the current industry business model, with its focus on engine technology and its long product cycles, and opens the market to a range of new competitors. Hundreds of billions of dollars worth of industry assets could turn into liabilities. Dealers will be less relevant as fleets make up a much bigger portion of sales.

The economics of shared autonomous electric vehicles makes them competitive with public transportation for short trips—and more convenient (no schedules, door-to-door service). According to BCG analysis of traffic patterns and “pain points” of mass transit riders in Chicago, as many as 20% of public transit miles could shift to the new transportation mode.

Additional effects would include a sharp drop in fuel demand—an impact looked at in depth in an upcoming comprehensive powertrain study by BCG. And the sharp reduction of traffic accidents and related injuries from autonomous and semi-autonomous vehicles could reshape the auto insurance business.

Your Last Car

The study concludes “The next car you own may be your last.”

I believe the consulting group has the idea approximately correct, but they are likely a bit on the low side of things. Long haul trucking miles will vanish first, en masse, and quickly.

The faster and cheaper battery technology becomes, the quicker the transition to electric from gas.

Ownership Model

Adoption will become quicker in big cities than rural areas but by 2030, the driving model, ownership model, and insurance models will have undergone massive disruptive change.

Consider suburbia. Many people drive their car five days a week to a train station. They catch a Train from a place like Crystal Lake, Illinois to downtown Chicago. Their car sits on the train station lot for 10-12 hours, waiting for the return trip back home.


Continue reading here…

1 COMMENT

Subscribe
Notify of
1 Comment
Inline Feedbacks
View all comments

Stay Connected

157,452FansLike
396,312FollowersFollow
2,280SubscribersSubscribe

Latest Articles

1
0
Would love your thoughts, please comment.x
()
x