Cheaper, safer, and faster: that’s what your life will be like with an autonomous vehicle (AV). The average modern car already has some automated features: adaptive cruise control, emergency braking (with car detection and pedestrian detection), parking assist.
There will be up to 10 million fully driverless cars on the roads by the end of 2020.
And while it may seem contradictory, self-driving vehicles could actually save you money. True, this is a bold statement. But Intellias has been developing autonomous car software for a while now, and we’re here to prove that they can. Read on to find out the financial benefits of self-driving cars.
A self-driving car will save you money on the usual car-related expenses
With an AV, your fuel efficiency will go up. Because your car will communicate with other cars and control its speed more accurately, it will become almost perfect in terms of driving and fuel efficiency.
Self-driving cars will be even more effective when they operate in an environment specially designed for them. When cars know where to park in advance, for instance, less fuel is wasted circling around and looking for a parking space. Imagine new autonomous transport networks with smart parking where a car leaves you at your destination and goes to park itself without any supervision. That’s the dream!
No human factor means cheaper insurance, better healthcare plans
Driverless technology can cut costs dramatically. More specifically, autonomous cars remove the emotional factor in driving, making your drive smoother and more predictable. True, a survey of public opinion in the United States, Great Britain, and Australia proves that people still have concerns about AVs not performing as well as actual drivers. But so far self-driving cars have actually been safer than human drivers. For example, Google’s driverless vehicles have logged over 1.7 million miles during nearly six years of testing. And in all that time they’ve been involved in fewer than a dozen accidents, none of which were caused by the system’s failure.
Another way that driverless cars could save you money is by protecting the driver. Safer driving is cheaper because insurance costs less. McKinsey & Company estimates that in the US, mainstream use of robotic cars could save up to $180 billion yearly in healthcare and vehicle repairs alone based on a reasonable prediction of a 90% drop in crash rates.
A study by the Eno Centre for Transportation, a non-profit group, estimates that if 90% of cars on American roads were autonomous, the number of accidents would fall from 5.5 million a year to 1.3 million and road deaths from 32,400 to 11,300.
Forget about penalties – you’ll save on all kinds of fines
A self-driving vehicle won’t be tempted to violate traffic rules in order to move faster or park closer to the shopping mall despite the wheelchair symbol.
For many police departments, 42 percent of police contacts are initiated during a traffic stop – with driving under the influence of alcohol being the second-highest cause. Self-driving cars would render DUIs virtually obsolete.
According to a report by the Brookings Institute, hundreds of millions of dollars will be saved on penalties and fines each year. For instance, just in 2014, the City of Los Angeles generated $161 million from parking violations. All this money could stay in the pockets of its owners if they had self-driving cars.
Time spent in an autonomous vehicle will not be wasted
Autonomous driving saves money and time. With a driverless vehicle, you’ll have more time on your hands, making you more productive and, potentially, wealthier. This includes time for parking: you can save hours once you stop searching for parking spots. In some densely populated cities, the time a driver spends searching for parking can reach over 100 hours per year. Cars of the future park themselves or simply go back home.
And don’t forget that you won’t need to drive. This means that while commuting or traveling you can read, sleep, eat, or even do some business through Skype or your computer.
Beyond the practical benefits, autonomous cars could contribute $1.3 trillion in annual savings to the US economy alone, with global savings estimated at over $5.6 trillion.
On top of that, AVs mean that you won’t have to spend your free time and money on getting a driver’s license (or even several licenses if you want to drive different types of vehicles). And of course you won’t need to spend hours trying to pass the exams necessary to obtain a license.
A park instead of a parking lot
Driverless technologies will help to improve the situation on the roads and avoid consequences of human driving like congestion. A smaller number of more efficiently used shared cars will also require fewer parking spaces. Not only will this resolve one the biggest urban challenges today but also the space previously occupied by parking lots can be used for other purposes. And so too the funds: the government will save money that it can invest in parks, schools, kindergartens, and other community needs.
Parking accounts for as much as 24% of the area in American cities, and some urban areas have as many as 3.5 parking spaces per car.
Safer and more predictable autonomous driving will require fewer traffic officers. In fact, the entire philosophy of the road police will change completely.
Some researchers go even further, suggesting that fewer physical road signs will be required since driverless cars might be able to receive information about road rules and conditions electronically.
This leads us to the question of how self-driving cars will impact the economy. The American Eno Center for Transportation estimates that the annual economic benefits of autonomous vehicles may amount to about $200 billion. And that’s under the condition that half of existing cars go driverless. With 90% AV penetration, the benefits almost double.
Sharing autonomous vehicles would be cheaper than owning a personal car
The optimists from RethinkX say that hiring AVs will become cheaper than having a personal car by 2030, when 95% of the kilometers (or miles) you travel on the road will be inside a self-driving car. Their main point is that competition will make self-driving taxis and carsharing services more affordable than personal cars.
Forecast of new vehicle sales distribution in urban areas in the United States
Ridesharing services will also use autonomous cars because they will be cheaper than hiring drivers. Computers don’t need days off and holidays, overtime, social security, or sick leave.
Autonomous cars will be much more independent than traditional vehicles. And thanks to different automatic monitoring systems and analytical features, the cost savings of driverless tech is the real deal.
Cars are already facing a light version of ostracism in the most developed countries and cities. Local authorities in cities throughout the world are getting more negative about personal cars. Free public transport, very expensive parking, bans on diesel cars – this is only a short list of the measures taken by the mayors of Brussels, London, and Dusseldorf to limit the number of cars in their cities. And it’s only the beginning.
Cities cannot cope with overwhelming road traffic, air pollution, and the desperate need for parking space. So ridesharing self-driving cars are the next logical step. When robotaxis are widely and cheaply available, will conventional taxis, car rentals, and car dealerships become redundant? Car giants are already preparing for this new reality by investing in driverless technologies and buying up or partnering with ridesharing services like Lyft and Uber. As you can see, the economic impact of autonomous vehicles will be massive.
The University of Michigan Transportation Research Institute suggests that driverless cars may reduce the number of vehicles a family needs. In the most extreme scenario, self-driving vehicles could cut average ownership rates from 2.1 to 1.2 vehicles per household, researchers say. This estimate is based on the fact that most of the time any given car is just parked. A single self-driving car could replace up to 12 regular vehicles thanks to its ability to travel from one passenger to another.
Numerous predictions about AVs have been published in the last 10 years, and many of them have failed to come true. But changes are inevitable, and in a couple of decades driverless cars won’t be so futuristic after all.
One cannot expect that all fantastic forecasts about robotic cars will come true, but even if a third of them materialize, traveling by car will become much more affordable. Curious about the economic impact of self-driving cars?
Ask Intellias – a master in finding smart solutions for car manufacturing companies – how driverless technology can reduce your costs today.