By 2030, 95% of U.S. car miles traveled will be in self–‐driving, electric, shared vehicles.
Nextbigfuture has discussed similar concepts in prior articles. Rethinkx has put together a comprehensive report and analysis.
Nextbigfuture also interviewed the authors.
Tony Seba: Report co-author, RethinkX co-founder, author of “Clean Disruption of Energy and Transportation,” and instructor at Stanford Continuing Studies.
James Arbib, report co-author, RethinkX co-founder, technology investor and philanthropist.
It is the combination of self driving cars, electric cars and shared vehicles that will provide rapid disruption.
Seba and Arbib point out that heavy usage of shared vehicles will see lower cost mainly with longer lasting vehicles. Electric vehicles that could be driven for 500,000 miles will see great cost advantages and are already at that level. Soon they will achieve 1 million mile driving lives.
Research shows that doubling population and increased urban density boosts productivity by about 15%. Serious study of the role of location and density in economic development probably owes its origins to Alfred Marshall’s work on location and economic development in the early 1900s. Cities are economic drivers – the very core of economic growth and development. Higher earnings paid to urban workers and premiums paid by firms to be in urban areas are evidence of cities’ productive advantages. In the US, for example, earnings in cities are around 33% more than those in non urban areas (Glaeser and Mare, 2001)
Seminal work by Ciccone and Hall (1996) assessed the impacts of density on productivity in the US, and found that doubling employment density, and keeping all other factors constant, increased average labour productivity by around 6%. Subsequent work by Ciccone (1999) found that in Europe, all other things being equal, doubling employment density increased productivity by 5%. A third paper (Harris and Ioannides, 2000) applies the logic directly to metropolitan areas and also finds a 6% increase in productivity with a doubling of density.
A historic revolution in transportation will end over 100 years of individual ownership of gas–‐powered vehicles and devastate the oil industry in the process. That’s according to a groundbreaking new research report, Rethinking Transportation 2020-2030: The Disruption of Transportation and the Collapse of the ICE Vehicle and Oil Industries.
Assuming existing technologies and well–‐known cost curves, the report, produced by RethinkX, an independent research group, provides a detailed analysis of data, market, consumer and regulatory dynamics. It finds that within 10 years of the regulatory approval of driverless vehicles, 95 percent of U.S. passenger miles traveled will be served by on–‐demand Autonomous Electric Vehicles (A–‐EVs) owned by companies providing Transport as a Service (TaaS).
● Shared self driving cars will be four to 10 times cheaper per mile than buying a new car, and two to four times cheaper than operating an existing paid–‐off vehicle, by 2021.
● The cost of TaaS will be driven down by several factors, including utilization rates that are 10 times higher; electric vehicle lifetimes exceeding 500,000 miles; and far lower maintenance, energy, finance and insurance costs.
● The average American household will save at least $5,600 per year by giving up its gas–‐powered car and traveling by autonomous, electric TaaS vehicles.
For the oil industry, the widespread shift away from individual gas–‐powered vehicles and toward electric, autonomous, shared vehicles will be catastrophic. Global oil demand will peak at 100 million barrels per day by 2020, dropping to 70 million barrels per day by 2030, according to the report. This will impact different companies and countries disproportionately — and in many cases, dramatically — depending on their exposure to high–‐cost oil. “We are on the cusp of one of the fastest, deepest, most consequential disruptions of transportation in history,” said co–‐author Tony Seba, RethinkX co–‐founder, author of “Clean Disruption of Energy and Transportation” and instructor at Stanford Continuing Studies. “But there is nothing magical about it. This is driven by the economics,“ Seba said.
Savings on transportation costs will result in a permanent boost in annual disposable income for U.S. households, totaling $1 trillion by 2030. Consumer spending is by far the largest driver of the economy, comprising about 71% of total GDP and driving business and job growth throughout the economy.
● Productivity gains as a result of reclaimed driving hours will boost GDP by an additional $1 trillion.
● As fewer cars travel more miles, the number of passenger vehicles on American roads will drop from 247 million to 44 million, opening up vast tracts of land for other, more productive uses. Nearly 100 million existing vehicles will be abandoned as they become economically unviable.
● Demand for new vehicles will plummet: 70% fewer passenger cars and trucks will be manufactured each year. This could result in total disruption of the car value chain, with car dealers, maintenance and insurance companies suffering almost complete destruction. Car manufacturers will have options to adapt, either as low-margin, high volume assemblers of A-EVs, or by becoming TaaS providers. Both strategies will be characterized by high levels of competition, with new entrants from other industries. The value in the sector will be mainly in the vehicle operating systems.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
Known for identifying cutting edge technologies, he is currently a Co-Founder of a startup and fundraiser for high potential early-stage companies. He is the Head of Research for Allocations for deep technology investments and an Angel Investor at Space Angels.
A frequent speaker at corporations, he has been a TEDx speaker, a Singularity University speaker and guest at numerous interviews for radio and podcasts. He is open to public speaking and advising engagements.