"The removal of the driver is arguably the most significant and transformative innovation ever faced by the automotive industry." - The Future of Autonomous Cars, Berg Insights, 2016.
Transport - it's often the bane of urban dwellers. You may be familiar with the ritual of circling city blocks with eagle-eyed intent and determination, trailed by similarly intent drivers, as you all seek out that most elusive of entities - a vacant parking space. Once your vehicle is crammed into a sardine-like slither of space between two others, with no possibility of any car backing out unscathed, expect to fumble around for coins to pay your dues for a brief window of time on a small parcel of land.
Against this backdrop of frustration, the promise of driverless technology has emerged like a shimmering oasis for commuters.
The prospective scenario is for autonomous travel that delivers us from door to door in comfort, either alone or with one or two co-passengers. Forget the need for parking; the frustration of negotiating traffic; or the uncertainty of public transport.
But, beyond the technology's clear benefit for consumers, what impact will such a monumental change have on business sectors and industry, and what will characterise the broader economic implications of its revolutionary disruptive technology, particularly for investors?
Full speed ahead: Some winners and losers in the age of autonomous mobility
LOSS: less revenue for local councils
Most of us know the feeling of struggling to find a parking spot in a local government area, only to find one with an unsuitably short time frame and an exorbitant charge for over-staying our welcome. If the general consensus is that we all seem to be dipping into our pockets too regularly for the privilege of occupying a car-sized portion of council land, then the reality indicates we are not far off the mark. In 2016-17 the total value of parking fines raked in by local governments across NSW alone was $190,232,389. The arrival of driverless cars is expected to drastically reduce the demand for parking spaces, thereby reducing the number of fines administered. A widespread uptake of autonomous vehicles could conceivably cost local councils millions of dollars in revenue.
LOSS: less revenue for State Government
The total value of Police issued speeding and red light camera offences for the 2016-17 period was $185,843,248. This does not include the value of fines yielded from a range of other traffic related offenses. Driverless cars will utilise technology including artificial intelligence, sensors, cameras, radar and data analytics that transform the entire transportation experience and incorporate adherence to road regulations and conditions as part their overall functionality.
LOSS: Real estate to lose its 'proximity premium'
With predictions that commuting is set to become easier, cheaper and more enjoyable - more urban workers may look further afield to relocate to the suburbs, lessening demand for high priced inner city dwellings. Similarly, renters paying a small fortune for tiny apartments near the CBD may choose a less central, but more spacious and affordable housing option. Thanks to the convenience of autonomous vehicles, suburbs with poor public transport options will no longer deter home-seekers or renters. Areas devoid of ample parking spaces may also experience renewed popularity as parking becomes a non-essential feature. More broadly, following on from the theme of parking spaces, less of those spaces will be needed overall - which will free up space for new developments. In time, this could help to correct the dearth of affordable urban housing and contribute to lowering the cost of real estate.
WIN: Lives saved
According to the National Road Safety Partnership Program (NRSPP), most car accidents in Australia are simply the result of a momentary lapse in judgement or attention i. Autonomous vehicles eliminate human error. Behaviours such as driving under the influence of drugs or alcohol; driving while fatigued; making phone-calls or texting behind the wheel; carelessness; inattention and poor driving skills will no longer make a significant contribution to injuries and fatalities on the nation's roads. In a nutshell, it is anticipated that this technology will save many lives. In an indirect consequence, emergency services will also have reduced demand for their services, which could lead to better service delivery and response times for other people requiring immediate and critical assistance.
WIN: Housing affordability
Just as ease of transportation may cause headaches for real estate businesses and investors, it could bring welcome opportunities for home buyers and renters. Redundant parking spaces and carparks could be could be repurposed as residential development sites, easing demand for affordable housing over time. More efficient transport in the form of driverless vehicles could make commuting an attractive option, leading more city workers to consider cheaper housing options further afield. Full adoption of driverless technology would put more money in the average worker's pocket, with no need to for car repayments, repairs, maintenance, registration or insurance costs.
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