Setting the Scene for the Autonomous Vehicle Industry
A lot of people don't realize that when they're driving down the roads, but [autonomous vehicles are] there. The industry as a whole did about a million and a half miles in 2018, just in California. Across the U.S. they were pushing about five million… In 2019 I wouldn't be surprised if 20 million miles were driven by autonomous vehicles on the road.
We've had about $100 billion invested in autonomous vehicle technology and investment, [which is a] fairly broad category. The players are a little tougher, though, because it's different. We think of traditional [original equipment manufacturers] (OEMs) like Ford and GM and Chrysler, but they’re not always the main players here. So we're also seeing, you know, Amazon, Apple, Google, Waymo, these new entrances to this transportation industry. It’s not something we were expecting, but I think it's going to be a mix-up. I think the jury's still out on who's going to end up being the winner, and we’ll probably get a better sense in that 12- to 36-months category. But there's probably going to be alliances that we didn't expect.
[Let’s] take Argo, for instance: Ford invested about a $1 billion, but now all of a sudden you also have VW investing in them. [It’s the] same thing with Cruz. We think of that as the General Motors kind of spin off, but it was announced just last week that now Honda is going to do an investment, and then you have Amazon and Toyota teaming up. So we have this cross-collaboration, cross-pollination that I don't think anybody would have expected five years ago.
Autonomous Vehicles Beyond Cars
Well, we think about the car because we see that first and we hear the most about it. Trucking is definitely an industry that that this is going to hit it fast and heavy. And that's happening now, you know. [There are] a couple [delivery companies] working with Walmart and Postmates. But the other piece, I think, is the people movers. A lot of people don't realize in locations like Miami, Las Vegas, Los Angeles and places like that, we're already doing these modified buses that are moving people around downtown. So the technology is there. It will be implemented in numerous ways, some of which we probably don't even know about yet. But I think the cars, the truck and the bus [are] well underway.
Hybrid Autonomous and Manual Vehicles
I had the opportunity [to ride] in one of the new high-end Volvos and you could do [automated driving] not just on interstates, but on country roads. It'll keep your speed and keep you in the lane, so that technology is already here today. I think just because they are technology-focused, people want to see that hybrid. But I think we'll eventually just see the full jump over to electric vehicles that hasn't become present today. If you look at hybrid sales in the U.S., they are way down right now. I think, we’re maybe one switch in the executive branch away from seeing more regulation in an environmental permitting that could really jumpstart the shift. Not only hybrids, but [also] electronic vehicles.
Autonomous Vehicles and Community Planning
You have got to get in front of [autonomous vehicles] from infrastructure and urban planning. We don't need as many parking decks. Parking decks are very hard to repurpose to office or affordable housing, things like that. So, we're going to need less [space like] downtown corridors, transit corridors already [in cities like], again, Miami, Las Vegas, L.A., and many other ones. They're already moving away from having those parking deck requirements associated with new development. [Instead of the last-mile problem,] it's called the last 50-foot problem, and it affects not only pizza delivery but package delivery and mail delivery and many, many other things.Benton Blaine, Vice President, Infrastructure & Economic Development, McGuireWoods Consulting
The second one is from a jobs perspective. We're going have a lot fewer jobs associated with delivery drivers, truck drivers, and it could even be things as simple as you know, bus drivers in your local community. Those positions are going to shift to more of a [technician role]. You know, somebody has to maintain these vehicles programs when something goes wrong, they have to fix it. That's not a job skill that we have a very solid base of in the U.S., so we're going to have to build it, and we need to build that quickly, ideally before we lose those jobs. So we want a nice, smooth transition, not a, “Now we have to re-train 100,000 people at once.”
Roadblocks for the Autonomous Vehicle Industry
If you look back at 2012, most people would have predicted that we would have been much further along. But one, I think it's understanding, the training curves associated with autonomous vehicles, and then the second piece is, if you could have only autonomous vehicles on the road in a year, that would be easy. So how do you get autonomous vehicles to interact with us humans that don't always make the same decisions? We don't always let a car merge. Maybe depending on our mood, we don’t, or we do. So it's hard to teach a technology to understand the non-characteristic and non-format response of a person. I think that's going to be the hardest piece. But as that gets solved, or maybe autonomous vehicles get dedicated lanes, you're going to see that speed up. But I'm okay with this approach because I'd rather go tried and true versus rushed and worried. And then with that being said, you know, you did have the Uber incident that I think set the whole industry back. We don't need to ignore that. And I think that's going to happen. And I think, unfortunately, if it ever were to happen again, I think that's something that you have to predict for. Because we can't ignore the fact that one of the highest reasons for death United States is car accidents. That's a problem we're trying to solve. So to say that we expect for it to never happen again, I think it's unrealistic. Our goal is to substantially reduce that. And I think that's going to happen.
Potential Solutions of Autonomous Vehicles
It could be as simple as getting goods you order faster, to even if everybody or a lot of people are in autonomous vehicles, you need less police officers on the road. There are less accidents, there are less speeding tickets, so it allows your police force to focus on other and major crimes. Same thing for EMS, if they don't have to be spread outward about accidents, you know they can focus on proactive monitoring. So it'll be interesting. It's going to affect the police force, EMS, firefighters, even hospitals. You know, they don't have to gear up for the car accidents. They can focus on other preventive care. So, I do think in some shape, form or fashion it will affect, you know, every single piece of our daily lives.
Autonomous Vehicles and Package Deliveries
[Instead of the last-mile problem,] it's called the last 50-foot problem, and it affects not only pizza delivery but package delivery and mail delivery and many, many other things. So, you got two options. One is right now; we can get the [autonomous] vehicle to the curb. So, is the [consumer] comfortable walking to that and getting it in a timely fashion? I could only imagine, though, if we just threw a pizza or a package out on the curb. It's probably not going to live there very long.
So, the other pieces, how do you tackle that? You have companies such as Amazon there right now, focusing on a wheeled delivery platform, so it wheels out of the back and it takes the package to your door. But you saw Ford, just a few weeks ago announce something really interesting [with a] bipod approach. So, you know it's a machine. It has legs. It can pick up a package and take it to your door. If they figure out that technology, it solves a lot of issues. There's immediate cost savings and downsizes. You know, there's also tens of thousands, if not hundreds of thousands of jobs. If you think of the Postal Service package delivery, pizza delivery, it’s those jobs that are kind of right in that category. But if you could do it, there are tremendous cost savings.