I’ve been hearing a lot lately about self-driving cars. In
March, a Delphi Automotive autonomous driving SUV completed
a cross-country 3,500 mile trip from San Francisco to New York making it
the first driverless vehicle to ever drive coast to coast. Supporters of the driverless
vehicle allege that this invention will completely revolutionize just about
every aspect of modern life, and after reading up on the topic, it’s hard for
me to disagree. However, regulatory, ethical, and political issues that come
along with the driverless car movement will be numerous, and it will be
interesting to see how these issues are dealt with by skeptics and supporters
alike. Regardless, their eventual adoption into our lives will change the way
we approach everyday tasks, and that includes the way we approach community
economic development. Below is just a sampling of the impacts expected from
widespread driverless car usage, which are either directly or tangentially
related to community economic development.
Whole industries will dissolve while others prosper: It is hard to quantify the number of
industries that will be disrupted or fold entirely in a world populated by driverless
vehicles. The auto insurance, auto finance, replacement car parts, trucking,
oil and gas, and rental car industries are just a few of the industries that
will be affected. However, with disruption comes opportunity. Ride sharing service
companies like Uber will surge as they integrate driverless car fleets into
their business models. Inter-industry linkage opportunities between the
automotive manufacturing and information technology sectors will be abundant,
and potentially result in new jobs in fields that don’t even exist yet. Logistics
and utilities industries will see upticks in efficiency as many of these
company’s operations become automated and less prone to human error. In fact,
some mining
companies are already using driverless trucks, a move that has resulted in
greater operational efficiency, increased productivity, and safer working
conditions in an industry that is notorious for its safety issues.
Millions of workers will need to be retrained in new careers: In 2014, there were 4.1 million people
employed nationally in motor vehicle operator positions. The widespread
adoption of driverless cars will render many of these occupations obsolete, and
thus, require a concerted effort at the community level to retrain workers with
the job skills that a post-driverless car economy willdemand. Community
colleges, technical schools, and other workforce development partners will be
relied on to reequip these workers with competitive skill sets. The short-term
unemployment challenges that this dynamic creates are daunting. However, the
availability of new labor will benefit additional industries that are starved
for workers. The key will be making sure that these workers with service
industry and manufacturing backgrounds receive adequate job skills training in
the STEM fields that are increasingly in demand in the national economy.
Public safety benefits will be dramatic: Over 30,000 people die
each year in the United States due to motor vehicle collisions, and car crashes
are the primary cause of death of Americans between the ages of 15 and 24 years
of age.[i]
According to the Department of Transportation, there was an average of one alcohol-related
driving fatality every 51 minutes in 2012.[ii]
The proliferation of cell phones, especially among inexperienced teen drivers,
has also created a budding public safety crisis for anyone driving in the 21st
Century. All of these difficult public safety realities would be erased by
driverless cars. Up to this point, seatbelts, antilock brakes, and airbags have
been the most important safety features to become commonplace in standard
vehicles. Still, these inventions do little to solve the primary root cause of almost
all accidents: human error. McKinsey & Co. released in March what is perhaps
the most comprehensive study conducted to date on the benefits of autonomous
vehicles. The study found that self-driving
vehicles could eliminate 90 percent of all auto accidents in the United
States, and save the country nearly $200 billion annually in costs associated
with wrecked vehicles (mainly healthcare).
Traffic congestion will fall and worker productivity will rise: One
study by researchers at the University of Michigan Transportation Research
Institute estimates that driverless vehicles could cut average household
vehicle ownership rates by 43 percent, as families consolidate vehicle usage in
favor of more efficient driverless cars that can operate independently with or
without a passenger. Fewer vehicles on the road will in turn result in less
traffic congestion. The average commuter in the United States spends 38
hours a year stuck in traffic, which equates to nearly a full work week. The
previously mentioned McKinsey study estimates that commuters worldwide could
shave off 50 minutes a day in a world where driverless cars are the norm. The
resulting increase in labor productivity can help to spur innovation throughout
the global economy.
Spending potential for individuals, families, and small businesses will
be freed up: Amazingly, cars sit unused about 90
percent of the time. When you calculate both the upfront costs and the
long-term maintenance costs, they are a big financial burden for many
individuals and families. Conventional cars reduce the disposable income that
someone has to spend on other things, and they can wreak havoc on a credit
score. Small business owners and entrepreneurs can be especially burdened by the
debt associated with car ownership, since additional debt obligations represent
just another hurdle to hiring people and purchasing capital. Reducing the
financial costs associated with car ownership may help to usher in an era of
unprecedented innovation, commodity spending, and small business growth.
A potential game-changer in combating global warming: In 2013,
greenhouse gas emissions from the transportation sector accounted for 27
percent of all greenhouse gas emissions in the United States. Passenger
cars and light-duty trucks were responsible for over half of the emissions in
the transportation sector. Reducing the number of these types of vehicles on
the road will greatly reduce the carbon footprint of your average U.S. family. Driverless
cars will predominantly be electric and far more fuel efficient than
conventional hybrid or gasoline-powered cars, which are hampered by the clunky
driving patterns of humans. In 2014, the United States consumed 136.78 billion
gallons of gasoline, and there’s no telling how drastically that number
could fall with widespread adoption of driverless cars.
Urban renewal opportunities will alter our built environment: Driverless
cars won’t have the same parking demands as a conventional car, and thus, parking
lots and parking garages may soon become ancient relics just like pay phone
booths. It is estimated that as much as 30 percent of the land in many urban
cores in the United States is devoted to parking. Paved parking areas are
eyesores that have unfortunately become the most recognizable feature of the
built environment in metro areas around the world. They also increase runoff,
which increases the threat of flooding and contributes to the contamination of
our waterways. As parking lots and garages become obsolete, there will be tens
of millions of square feet of prime real estate freed up in downtown areas across
the United States. This will help pave the way (pun intended) for exciting
community economic development opportunities. Imagine if every parking lot in
the United States suddenly became either a public park, or a community
hospital, or a small business incubator, or a new public school? The potential
impact on residential development will be equally significant. Housing could
become much more affordable once land that was formerly devoted to parking
spaces is freed up for new residential development opportunities. On the
flipside, driverless cars may exacerbate problems with suburban sprawl as
people become comfortable living further away from urban jobs centers due to
the reduction in commute time that driverless cars will afford them.
Even in the most optimistic scenario, driverless cars are a
few decades away from being widely adopted by the consumer market. What impact
will driverless cars truly have on society? Nobody knows the full answer yet,
but one thing is for certain – we won’t have to stand in line at the DMV to
find out.
