I notice with faint amusement that Intel announced last week (rather too confidently) that ‘Self-driving cars will add $7 trillion a year to global economy by 2050’. As one less-than-impressed punter remarked: This was presumably said to boost Intel shares.
What is the impact on us as engineering professionals?
Here we go again – ‘Massive Business Opportunities’
The move to the driverless future reminds me of a comment made by another colleague commenting on the confident prediction of the paperless office in the eighties (because at this time everything was being computerised from paper-based systems). He rightly noted that we are as close to the paperless office as we are to the paperless toilet.
And surely enough at this time – with the advent of computerisation - there was a huge surge (no decline whatsoever) in paper consumption because of easy access to computer-connected printers (and presumably other reasons such as the massive increase in regulations requiring records of everything to be kept – so called ‘paperwork’).
It is only some 30 years later with huge changes in technology (e.g. smartphones and tablets) that I believe there has been a huge drop off in office paper consumption. I believe the same will be true of the self-driving car. Many predictions of imminent changes but these may be off by a few decades. As the remarkable investor Howard Buffet remarked: Timing is always the hardest thing to get right when investing for the future.
The ‘Passenger’ Economy
The concept which Intel has been promoting is that huge new businesses will rapidly form because of car drivers soon having ferocious amounts of time available now that they are not controlling a steering wheel any longer. An estimate of the additional time available to people is 250m hours per year.
Typical activities for people sitting in driverless cars would include watching movies and playing games. Unusual suggestions for new businesses include mobile beauty salons and health clinics. People will no doubt increasingly abandon owning a car and will summon them when required. One can already see this in many cities where you only pay for a car when you use it.
Other suggestions are that driverless cars would go to consumers to provide a portable restaurant experience. Naturally, freight and deliveries would now be conducted 24 hours a day/7 days a week. Recharging farms would be needed for provisioning electric vehicles with power and parking space.
But the Main Concept is Probably not directly about cars
The key opportunities will be created not directly by driverless cars but by the technologies and businesses that arise from this change in life style. For example, in replacing car sales, maintenance, repairs, crash repairs, insurance, refuelling and space for a garage.
Horrible Deaths May be Lower
The typical statistic that is thrown around is that there are over a million deaths per year worldwide due to car crashes. Autonomous cars should make a huge dent on this huge toll. Something that hasn’t really been considered is the Law of Unexpected Consequences arising from when the death toll is reduced insurance drops dramatically, repair smash repair yards go out of business, funeral parlours experience a significant drop in their business and trauma hospitals and counselling services aren’t as busy etc.
Ultimately, everything is driven by costs and perceived value. You either pay considerably less or think that you are getting considerably more value for your experience. This will thus drive this industry to some dramatic changes.
The shift is cost driven, you either pay a lot less or you get a lot more for the same money. It's also more convenient not to deal with maintenance, refueling, parking .. or owning a garage. And more flexibility as you can ride in different types of vehicles, according to one's needs at a given time.
When will this change occur ?
I suspect there will be the usual concerns and screaming for more regulations because of safety concerns with self-driving cars that drive amok. There will be a huge number of sceptics about this change. But surely within the next decade we will start seeing a growing impact from these autonomous cars in our cities.And perhaps not merely on the road but finally autonomous vehicles in the air as well…….
Seize the Opportunities today
As an engineering professional – it is clear that no matter what industry you are in – these opportunities are worth while grabbing. Pause for a moment and consider what you can do?
Gary Shapiro, president and CEO, CTA remarked (quite humorously, I thought): “If you asked Americans back in the early 1900s their opinions about daily transportation needs, they’d have said they wanted faster horses that ate less food!”
Yours in engineering learning