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Report: Private Autos to be Obsolete by 2030

A Google prototype self-driving car | Photo: Pascal Terjan, some rights reserved
A Google prototype self-driving car | Photo: Pascal Terjan, some rights reserved

15 years from now, you probably won’t own a car and the gasoline station on the corner will have gone out of business.

But the abandonment of private gasoline-fueled automobiles won’t be due to some heavy-handed environmental government edict forcing the change; just a combination of tech advances and the free market. And the drastic change may well improve your life immeasurably.

That’s the elevator version of a report released this month by RethinkX, an independent think-tank studying the effects of disruptive technologies on everyday life. According to the report, a combination of increased acceptance of self-driving cars — which RethinkX suggests will be legal for general use by around 2020 — and advances in electric vehicles will mean 95 percent of automobile passenger miles will be ridden in hired, driverless electric cars.

RethinkX, which bills itself as “a team of technology, finance, and market sector experts, consists of analyst Tony Seba, who has in the past written rather presciently on the ongoing explosion of solar energy generating capacity, and James Arbib, a London-based venture capitalist and philanthropist.

At the wheel of a self-driving Nissan Leaf | Photo: Philip Toscano/PA Images via Getty Images
At the wheel of a self-driving Nissan Leaf | Photo: Philip Toscano/PA Images via Getty Images

Their report, “Rethinking Transportation 2020-2030:  The Disruption of Transportation and the Collapse of the Internal-Combustion Vehicle and Oil Industries,” says that people will increasingly abandon private vehicle ownership as it becomes more expensive and less practical than relying on what the study’s authors call “Transportation as a Service” companies, who will dispatch driverless electric cars on demand to an increasing number of urban regions. Since these companies will be forced to compete on cost, the price of a trip across town will become much lower than the equivalent cost of using a private vehicle — especially when you include car loans, insurance, maintenance, and ancillary costs such as parking.

Rural communities will likely be the last holdouts for privately owned internal combustion engines, as low population and greater distances between destinations will reduce the cost-competitiveness of self-driving electric cars. But even rural areas may be forced to switch as oil companies lose the urban markets that subsidize rural gasoline infrastructure, and close money-losing gas stations out in the sticks.

If this sudden, society-changing shift sounds like a pipe dream, consider this: just 15 years ago, very few people had ever seen anything like a smartphone, and analysts predicted that their expense would cause them to remain a niche market item. Now, more than three quarters of Americans have shelled out hundreds of dollars each for smartphones, and significant amounts each month to keep them connected. If an appealing technology that costs a big chunk of most people’s monthly income can become omnipresent in around a decade, then a technology that saves people even more money can only spread more rapidly.

According to RethinkX, a typical American household will be able to save more than $5,600 a year by dumping their gas-guzzler and using Transportation as a Service companies, the equivalent of a ten percent boost in income, on average.

And that incentive will only grow as people abandon their old internal combustion engine vehicles, as mechanics find other work and gas stations go out of business, making driving a gasoline-powered vehicle ever more expensive and annoying.

In the words of the report, “individual vehicle ownership, especially of internal combustion engine (ICE) vehicles, will enter a vicious cycle of increasing costs, decreasing convenience and diminishing quality of service.”

A prototype Uber self-driving car navigates San Francisco traffic | Photo: Justin Sullivan/Getty Images
A prototype Uber self-driving car navigates San Francisco traffic | Photo: Justin Sullivan/Getty Images, by cclarke

By 2030, concludes RethinkX, around 40 percent of small vehicles will still be privately-owned internal combustion engine vehicles, but their use will make up just five percent of all passenger miles driven in the U.S.

According to Arbib and Seba, while analysts have examined the role that electric cars, Lyft-style ridesharing services, and self-driving vehicles might play in American society in the near future, no one has considered how all three innovations might amplify the effects of the others.

[T]he cost of transport-as-a-service (TaaS) will fall to such an extent that owners of vehicles will abandon their individually owned vehicles at a speed and scale that mainstream analysts have failed to predict... This is because they have failed to foresee the extent of the cost reduction and the impact that will have on the speed of adoption. Mainstream scenarios generally focus on new car sales, with ICE vehicles gradually being replaced by EVs, and not on the entire existing fleet of vehicles being disrupted and stranded.

How might each technology augment the benefits of the others? Take the issue of “range anxiety,” still considered a significant obstacle to electric car adoption. Some drivers have hesitated to switch to electric cars because the more affordable models can travel only 80 miles or so, and require at least half an hour of charging to go the next 80 miles, assuming the driver is lucky enough to find a quick charger.

But a system in which electric cars are dispatched Lyft-style to your home or workplace removes that issue. If you need to go from Los Angeles to Fresno in a present-day electric car with an 80-mile range, you’ll spend at least a couple hours of that trip charging your vehicle. With a transportation as a Service setup, however, you’d just get to a designated charging station, hop out of the car and into a fully-charged one waiting for you, and get back on the road.

The Don Valley Parkway in Toronto | Photo: Ashton Pal, some rights reserved
Fewer vehicles means fewer cars on the road, and potentially less pavement.  | Photo: Ashton Pal, some rights reserved

Another potential benefit: shifting to Transportation as a Service would mean fewer vehicles, since more people would be using each existing vehicle during the course of the day rather than maintaining their own. And that could mean opening up a lot of real estate in our auto-dependent cities, de-paving parking areas and devoting that land to other uses, and generally making cities more pleasant.

The authors suggest that a Transportation as a Service economy, which might prove to be dominated by present-day auto companies trying to stay alive in a changing world, might even offer free services in some situations, suggesting that companies like Starbucks might find it economical to subsidize a ride to a store for a person in need of caffeine.

Graph showing swiftly declining private car use by 2030
"Transportation as a Service" (TaaS) mileage (pink) is projected to surpass private car mileage (blue)  nine years from now. | Graph: RethinkX

The report offers a breathtakingly optimistic take on the combined effects of these three disruptive technologies, and readers could be excused for cocking an eyebrow at what might seem not just pie in the sky, but an entire aerial bakery.

In particular, the team’s assumption that self-driving cars will become not only sanctioned but widely accepted in just a few years may well prove unwarranted, given the likelihood of unanticipated roadblocks.

And Seba and Arbib do discuss potential downsides to their scenario, such as increasing disruption and public suffering in countries whose economies are based primarily on oil exports.

But it’s an undeniably rosy picture, and RethinkX says its intent in painting that picture is to start a conversation among planners who might be taken by surprise if (for example) they assume the continuation of privately owned automobiles in central cities.

And the potential benefits are significant. As Arbib and Seba write,

[Transportation as a Service] will dramatically lower transportation costs; increase mobility and access to jobs, education and health care (especially for those restricted in today’s model, like the elderly and disabled); create trillions of dollars in consumer surplus; and contribute to cleaner, safer and more walkable communities.

All of which sounds worth planning for.

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