Could driverless technology make car ownership a...
|
Bookmark and Share
Jan 08, 2016  |  Vote 0    0

Could driverless technology make car ownership a thing of the past?

Advances in driverless technology could lead to drops in vehicle ownership

OurWindsor.Ca

Is car ownership going the way of the dodo?

That’s hard to imagine after a year in which North American auto sales soared to a record high. But a future in which more people share fewer self-driving cars was hard to miss at this week’s Consumer Electronics show in Las Vegas.

From General Motors Corp. to Waterloo-based Blackberry Ltd., there were plenty of high-profile announcements aimed at making cars more autonomous.

Cities are growing more congested, regulators are demanding fewer emissions, and technology is driving solutions. That could all add up to a dramatically different future for a century-old business.

“Instead of owning a car outright, we might start consuming mobility services,” Stefan Burgstaller, head of European automotive equity research for Goldman Sachs, said in a December 2015 presentation to investors.

Self-driving cars could cut North American demand for new vehicles by 40 per cent within 25 years, Barclays Capital predicted in May 2015 report, in part by making it easier for more family members to share fewer cars.

How? Imagine that the same car could take you and your spouse to two different workplaces — at two different times — and also drop your kids off at school, all while you checked your phone for news, weather, sports and work-related emails while sitting in traffic.

Who needs a second car in that scenario? Or even a first one, if you opt to use a ride-sharing app — like Uber or Lyft — to hail a self-driving vehicle whenever you need to go anywhere.

Such a model would also be cheaper than the current one, the report, called “Disruptive Mobility,” predicts. It says the average cost of owning and operating a car now works out to 66 cents (U.S.) per mile. (In Canada, the average cost per kilometer ranges from 46 cents to 65 cents Canadian, depending on whether you’re driving a compact like the Honda Civic or an SUV like the Chevrolet Equinox, according to a Canadian Automobile Association online calculator.)

In comparison, the future cost of hailing a self-driving vehicle would be just 29 cents (U.S.) per mile, the report by Barclays predicts. And if you’re willing to pool that ride with others, the cost falls to just 12 cents (U.S.) a mile.

That’s far lower than the current cost of taxi and ride-hailing services, the report explained, in large part because it eliminates the most expensive element — the driver.

“The vehicle market is set to be disrupted,” the Barclay’s report concluded.

That might be hard to picture at the close of a year that saw record-high auto sales in Canada and the U.S., at 1.89 million and at 17.5 million vehicles respectively.

Not everyone buys the report’s vision of the future. “This is the 20th or 30th one of these where a craze happens and in retrospect it turns out to be not that big a deal. The best example right now is hybrid electric vehicles. Their sales are down, not up,” Canadian auto industry consultant Dennis DesRosiers said in an interview.

Indeed, personal car ownership is rising, DesRosiers said, noting that 85 per cent of Canadians now own a vehicle, up from 70 per cent in 2000.

DesRosiers predicts it could take another century before even half the vehicles on the road are replaced by self-driving vehicles. It’s been 17 years since the first hybrid electric car hit the pavement, and they make up just one-tenth of one per cent of all vehicle sales, he noted.

Lower gas prices, low interest rates and pent-up demand drove North American buyers into auto dealers’ showrooms in record numbers in 2015.

But that equation could look quite different in future due to demographic trends, concerns over climate change and the emergence of technology giants as major auto industry players.

The global automobile industry is on the brink of a major transformation, investment bank Goldman Sachs said in a recent report, called Cars: 2025.

“Technology is driving this shift, shaped by demographic, regulatory and environmental pressures. By 2025, the car and the world around it will look quite different,” the report predicts.

Barclays calculates a single Uber-style self-driving vehicle could take the place of seven traditional owner-operated vehicles.

Furthermore, pooled autonomous vehicles — where a group of riders share a single self-driving van — could take the place of 17 traditional cars, the report said. (Think Uber Hop, the new ride-sharing service that supplements Toronto’s congested King St. W. transit route, except without a driver.)

No wonder the world’s biggest automakers are scrambling to join forces with the major technology companies and ride-sharing upstarts who are driving much of the change.

Automakers announced a slew of new initiatives during the Consumer Electronics Show in Las Vegas this week. Indeed, it’s a sign of the times that automakers are becoming an ever bigger presence at the electronics show, which runs a week ahead of the auto industry’s most important annual event, the Detroit auto show, next week.

“The announcements are getting bigger and bigger every year at the Consumer Electronics Show,” DesRosiers acknowledged. “Within five years, you can envision we’ll all flock to Las Vegas the first week of January instead of Detroit.”

Steps to self-driving

Self-driving cars stole the show at the annual CES tech-fest in Las Vegas this week. Here are four things we learned about the future of autonomous cars.

General Motors Corp., America’s largest automaker, announced it would invest $500 million (U.S.) in ride-sharing service Lyft, the leading U.S. competitor to Uber. The two companies said they would work toward developing a fleet of self-driving cars. In the meantime, GM will become the preferred provider of Lyft vehicles for rent. GM also unveiled its 2017 Chevrolet Bolt EV, an electric vehicle priced at $30,000, with twice the range of Nissan’s Leaf. The Bolt was also designed with ride-sharing in mind, leading to speculation it could become part of a future Lyft fleet.

BlackBerry Ltd. unveiled a slew of new software for the driverless car in a race with Apple, Google and Tesla Motors for a share of this rapidly evolving market. The company’s QNX software division already builds the in-car navigation and entertainment systems used in more than 60 million vehicles built by Ford, General Motors, Hyundai and Volkswagen. Now, BlackBerry is creating a platform for self-driving features. The Waterloo-based tech giant showcased demo cars that can scan for obstacles, avoid straying out of their highway lanes and communicate wirelessly with other cars on the road to avoid accidents. The new software is scheduled for release later this year.

Ford Motor Company announced it would triple the size of its fleet of fully autonomous Ford Fusion Hybrid test vehicles from 10 to 30. More immediately, the automaker said it had brought Amazon’s Alexa voice-activated assistant into its vehicles, allowing drivers to interact with smart home features — for example, opening a garage door and turning on porch lights on the way home. Ford also announced it was adding Apple CarPlay and Google’s Android Auto connectivity to all 2017 models equipped with its InSync info-tainment system, allowing drivers to use their mobile phones through the vehicle’s dashboard.

Faraday Future, a secretive electric-vehicle startup backed by Chinese billionaire Jia Yueting and stacked with former Tesla Motor executives, made its Consumer Electronics Show debut. However, its futuristic concept car, the FFZero1, a single-seat Batmobile-style vehicle, raised more questions than answers about the company’s actual game plan. The U.S.-based firm has said it will build a 3 million-square-foot assembly plant in North Las Vegas, where it will produce a premium-priced car that might also come with a new business model, either shared ownership by several people or a product that drivers can subscribe to.

Toronto Star

|
Bookmark and Share

(0) Comment

Join The Conversation Sign Up Login

In Your Neighbourhood Today

SPONSORED CONTENT View More