Timeline (Long-term)

The first commercial release of an autonomous vehicle will be a momentous occasion and an event of historical significance. This won’t be because it is a technological marvel (though it will be). Instead, we will remember it because it will come to symbolize the beginning of the end of a way of life that has become familiar and socially ingrained over the past century. The technology will most directly change the way we travel, but it may also upend entire sectors of the economy by ending car ownership, ending the ubiquity of the internal combustion engine, eliminating car accidents, and ending driving as an employment option. It will also change the way we live by eliminating the need for parking, increasing mobility options (especially for the disabled) and altering the economics of travel, which will in turn alter land use economics. These impacts won’t happen on day one of this technology, so when will they happen? This question is critical for policymakers, planners, and investors, among others, and it depends on how quickly the technology is absorbed.

The timing of these impacts largely comes down to economics. Basically, when will driverless cars offer enough advantages that people will choose to use them in favor of existing options? Policy and social preferences will undoubtedly play a role, but predicting policy is perilous and I believe the social barriers to driverless car technology are overblown.

Perhaps unsurprisingly, forecasts for this technology are all over the map. The more conservative forecasts don’t see this technology fully replacing human driven cars for over 50 years. The more aggressive forecasts see human driven cars being largely obsolete by 2030. The chart below summarizes the range of perspectives.

Timeline - Long-term

Having thoroughly reviewed the assumptions and methodologies in these forecasts, I think there are a multitude of reasons the more conservative forecasts don’t warrant serious consideration. In fact, the forecast that I find most compelling is the most aggressive forecast by ReThinkX. It is the only study that makes an effort to account for the combined influences of autonomy, electric vehicles and TaaS. That said, the study makes some bullish projections for technology advancement (especially battery technology) that aren’t justified. I am inclined to think the deployment of autonomous technology will occur somewhat slower than RethinkX suggests, but still very quickly. It will be important to see how the assumptions driving their forecast stack up with reality over the next five years.

Importantly, we won’t have to wait for this technology to saturate the market before many of the economic and social implications of the technology play-out.