Have You Already Bought Your Last Car?
(3BlLMedia/Justmeans) — It’s getting hard to know what’s really true anymore. There are a number of reasons for this: fake news, political mischief and perhaps even a greater tolerance for liars. But there is also another reason: technology. Technology is changing so fast, that when people make pronouncements about deliveries by drones, exploration of other planets, or a rapid transformation of the car industry from what it is today, to a preponderance of electric, self-driving cars that are no longer owned by car-owners but hailed by a tap on a smartphone, it’s hard to know if they are simply making all this up.
According to Christopher Mims, writing for the Wall Street Journal, the one about the cars is true. With the convergence of electric powertrains, self-driving technology and the growth of new ride-sharing business models, we could be looking at a transportation revolution on a par with what Henry Ford’s Model T did a century ago. Ford’s revolution happened surprisingly quickly. Car ownership leapt from 8% to 80% of the population in just ten years. Is it about it to move that quickly in the opposite direction? A lot of trends seem to indicate that it could.
For one thing, there will be a multitude of attractive alternatives. Urban planners, concerned about making their cities greener, have put increased emphasis on public transit, bike lanes and walkable neighborhoods. For those too old or out of shape to walk or bike, new electrified bikes, scooters, and even skateboards can get you where you want to go quickly and affordability without wearing you out, safety concerns notwithstanding. These latter fall into the category of consumer electronics, vying for a market segment known as the last mile, getting a commuter home from a bus stop or train station.
These are some of the reasons why millennials seem to be opting out of car ownership. Surveys by the Urban Land Institute show that they are far less likely to use a car and more likely to use alternatives. Futurist Alex Steffen quipped that it’s because they can’t surf the web while driving. It’s more likely because they can visit their friends online without needing to drive over to their houses.
With the potential market shrinking, manufacturers realize that they need to respond. There are new breeds coming out, electric vehicles that fall somewhere in the space between cars, motorcycles and golf carts. Entries range from the bare bones solar-pedal ELF to the lightning-fast Arcimoto SRK are affordable, efficient and fun. Both of these are three-wheelers. Both Toyota and Renault are also planning entries into this market.
Meanwhile, the EV market continues to grow, bringing economies of scale to everything from lithium batteries to super-strong but light carbon fiber composite materials, which all then trickle down to these other segments.
Autonomous cars are the next step. The race is clearly on. All major auto makers have pledged autonomous cars within five years. Many of them are gobbling up Silicon Valley startups to help them sort out the details.
Finally, there is the ride-hailing. No one would have guessed that startups like Uber and Lyft, clearly enabled by the explosion of mobile technology, would have taken off the way they have. From there, it’s a small jump to an autonomous fleet of cars, circling or parked in a central location, ready to swoop in and take you where you need to go.
Michael Ronen, head of the Goldman Sachs Investment Banking Auto 2.0 team, sums it up well, saying, “…we’re on the verge of a huge disruption that creates tremendous opportunities for folks around the world.”