You Probably Won’t Have a Car Soon, And Here’s Why

Photo by Morne de Klerk/Getty Images

Photo by Morne de Klerk/Getty Images

New innovations and ideas are being developed and implemented at a rate never before seen. This has caused some turbulence in societies across the world as people of all different nationalities, age groups, and cultural backgrounds have had to wrestle with the idea and ultimate implementation of world-changing developments. Now that people all across the globe have become interconnected and we’ve gotten used to gadgets and cameras in every corner, the next inevitable step in the progression of technological innovation is set to take place.

One way technology is going to have a huge impact is within our systems of transportation, especially within the United States. Looking back over the past century, the state of transportation on a national scale has evolved dramatically. In the early part of the 20th century, mass transit was the primary way people got around cities, utilizing public railways, streetcars and metro systems. That system was co-opted by a plan set in motion by petroleum companies and automobile manufacturers, who had a vision of getting everyone in the country into their own car, paving the way for incredible business opportunities in the future.

Sounds a bit like a wacky conspiracy theory, doesn’t it? Well, it’s grounded in the truth. A company owned by General Motors called National City Lines bought up a number of municipal transportation systems across the country, shutting them down one by one. But the reasoning behind it isn’t quite as nefarious as some would like you to believe, as those who study the time period have concluded that rail systems were simply being replaced with buses, which did not require huge investments in infrastructure in order to operate.

This was the dawning of the age of automobiles, a time where people started to take to the roads in great numbers, leading to the expansion of the suburbs, a greater level of inter-connectivity between communities, and ultimately the founding of our national highway and freeway systems. Through crafty lobbying from the automobile and petroleum industries, the responsibility of building and maintaining roads was pushed onto the public, whereas many private rail companies were compelled to provide at least a portion of the funding for rail systems.

The conspiracy theory crowd wasn’t too far off of the scent, however, as several corporate entities did see time in court facing anti-trust charges.

All of that work over the course of the past century has led us to the system we have today: a mishmash of by-and-large lackluster public transportation systems in most cities across the country, and a high rate of personal vehicle ownership. The World Bank estimates that there are currently 786 motor vehicles on the road for every 1,000 residents, putting the ownership rate at just under 79%.

Throughout the years, as the ranks of the middle class grew in ranks, cars became more affordable. And in many cases, a necessary evil for those who lived outside of the main corridors of their cities, or out in the suburbs. Thus, cities became less walkable and more spread out — perfect for auto makers and petroleum companies.

This has been a phenomenon that has mainly manifested in the United States. Other cities across the world — Tokyo, London, Paris, you name it, really — all have robust public transportation systems that are built to move large amounts of people around in an efficient and timely manner. Almost anyone living outside of New York City in the U.S. can tell you that is not the case here, where public transportation is usually on the chopping block when it comes to budget cutbacks.

In stark contrast to the American way of life, one European city is taking things a step further. The Finnish capital of Helsinki is considering a plan that will essentially make private vehicle ownership pointless within a decade. That may sound absolutely absurd to an American, but to a European, it’s not all that crazy of a concept.

The plan calls for citizens to be able to use a ‘mobility on demand’ system, using a smartphone app to call for a ride when they need one. The idea is similar to what ride-sharing services are currently doing in the U.S., like Uber or Lyft, but on a much-larger and economical scale. The city has already implemented a similar system using bus lines, that allow for riders to actually choose their own route and call for a ride using their phones. That system is called Kutsuplus, and the new plan would essentially be a widespread adoption of the same system, although at such a large scale that owning your own personal car would, for many, become more of a burden than it’s worth.

But just how likely is this to actually work? Well, officials in Helsinki seem pretty adamant about getting the program off the ground, and that’s a good sign. But it doesn’t guarantee anything. It’s also important to keep in mind that citizens of most European cities rely heavily on public transport already, and that this may simply be an improvement, or augmentation, to existing systems. These systems are funded by tax systems that are of much higher rates than we have in the U.S., which is really a staple of Scandanavian countries in particular.

Source: Glenn Chapman/Getty Images

Source: Glenn Chapman/Getty Images

Taking the Finnish plan into account, is there really any realistic way that American cities could implement a similar system, or even consider it? Would they even want to? What are the real tangible benefits? And what steps would we have to take to get there?

You could say that we’re already headed down that path. It’s been widely publicized that Google has been hard at work on their driver-less car technology for several years now, and the technology has become perfected to such a level that their robot-driven vehicles have yet to receive a single citation from law enforcement. Not only has the technology been proven to be safe and effective, but it’s slated to actually hit the market in the near future.

That’s right, you can own your own self-driving car relatively soon. It’s not exactly an episode of The Jetsons, but still pretty cool.

What are the benefits of self-driving cars, exactly? There are numerous advantages, actually. According to a study released by the Milken Institute, a Santa Barbara-based economic think tank, the adoption of robot-driven vehicles could result in nearly five million fewer accidents, 30,000 fewer deaths and two million fewer injuries. Also, it could save us $400 billion in accident-related cost savings.

It’s also predicted that commuting hours in the U.S. alone could drop by 4.8 billion, 1.9 billion gallons of fuel could be saved, and the economy could get more than $100 billion back in productivity and fuel costs. Personal travel costs can also be greatly reduced, as a shared driverless car can reduce the cost-trip per mile by 80%, and lead to 90% less cars on the road.

As previously mentioned, all of this is currently in development, and major car companies are jumping on board. Nissan and Volkswagen are implementing driverless technology into their vehicles as we speak, and Volvo is actually getting ready to bring some of the first self-driving cars to market by 2017. Tesla has also announced similar technology that will likely be introduced even sooner.

Source: Justin Sullivan/Getty Images

Source: Justin Sullivan/Getty Images

Not only are automakers beginning the process of adapting their vehicles for driverless technology, but several peripheral technologies are being put together to work seamlessly with these cars in the future. Vice reports that Google Maps has been fully integrated with Uber’s ridesharing platform, which isn’t all that surprising as Google has been a big investor in the company. So why is that noteworthy? Uber’s fleet of vehicles, coupled with Google’s driverless technology and map data, could ultimately bring about an armada of robot-driven taxis.

The reports have come in that work is already underway on designing the program, and it’s an idea that could really lead to a giant shift in the way people get around. If you had a ride only a few minutes away at all times, that could be at your door in a matter of minutes, would you bother owning a car?

It’s a question that a lot of people are going to start asking themselves in coming years, especially for those who live in urban environments. Numbers indicate that the younger generations are already moving away from car ownership. A renewed interest in city life, and an abandoning of the suburbs by the millennial generation is partially to blame, and as that shift occurs, bicycles and ridesharing services are exploding in popularity. For many, the incredible cost of owning a car — from insurance to fuel, and not to mention the price of the actual vehicle itself — is simply not worth it. Rideshare services, along with car-sharing services like Car 2 Go and Zipcar, are simply a means of pooling resources to bring down costs for everybody, and it’s catching on.

Not only that, but owning a car is expensive. According to Bankrate.com, the annual costs of owning and maintaining a personal vehicle can range between $1,900 and more than $2,700, depending upon where you live. That’s a significant amount of money that people would probably be privy to saving, if given the chance.

There are a variety of factors playing into a the millennial’s interest in using shared resources, particularly when it comes to transportation. For one, many jobs are moving out of the office, and allowing for many to work from home at least part of the time. This has led to declining numbers of commuters, and less of a need for a personal vehicle. Another factor, for those who don’t telecommute, could be a boost in productive time. By taking public transportation, it allows for more personal time to relax and bang out some emails, or read a book. That typically can’t be done from behind the wheel, while driving.

Younger generations are already becoming accustomed to — and embracing —  the concept of shared resources. As rideshare and car-sharing becomes more and more ingrained into American culture, it could lead to a larger shift in the future — an abandoning of the idea of private vehicle ownership altogether.

What happens if, in twenty years or so, American streets are no longer filled with commuters in personal vehicles, but instead with robot-driven taxi cabs and driverless buses? As mentioned previously, the economic savings would be substantial, but who ends up getting hurt as a result? There are several industries that would be affected, from private companies all the way to local law enforcement groups. Of course, not everyone will be willing to give up their own personal vehicle. In fact, it might take a generation or two for it to be completely phased out, if it ever is completely. But many big businesses will be keeping a close eye on the trend, which gives a whole new meaning to the idea of ‘killer robots’.

For starters, insurance companies would take a huge hit if the idea of shared vehicle ownership, along with driverless technology, becomes a market mainstay. Imagine that instead of the five people on your block each owning their own vehicle, that the five pool their resources to purchase just one to share between all of them. That drops five insurance premiums to one, taking a big chunk out of revenues.

Of course, on the flip side, driverless cars would lead to safer roads and fewer accidents, leading to less claims and payouts as well. It’s hard to say exactly what the result would be from an insurance company’s point of view when all is said and done, but the prospect of losing huge portions of the industry’s customer base is frightening.

Who else is at risk? Big Oil, for sure. Not only would fewer vehicles on the road lead to declining sales, but a big uptick in domestic crude oil production could lead to surpluses, driving the price down even further (as we’ve seen recently). Add on to those factors the fact that electric vehicles and hybrid technology is quickly taking to the mainstream, and petroleum companies appear to have a very worrisome future on the horizon. Elon Musk announcing that Tesla was making their patents open source was enough of a threat on its own, but the looming possibility of fleets of electric-powered driverless cars is even scarier for Big Oil.

The car companies themselves are also at a big risk if things keep progressing. Much like the insurance industry, auto makers may soon be faced with a market that has much less demand for its products, and will need to find a way to stay alive. Of course, there will always be demand, as even driverless and shared vehicles are still, well, vehicles. And if communities are sharing vehicles, then they will probably be running around constantly, adding up mileage and depreciating faster.

But still, as explored with the ‘streetcar conspiracy’, public resources have been targeted before by auto makers as a potential threat, and the advent of people abandoning private car ownership is the worst possible scenario from their perspective. The fact that car companies, like General Motors, have been under intense public scrutiny is not going to help the auto industry’s case either.

One final area that could become the victim of unintended consequences is in law enforcement funding. Police departments and local municipalities typically pull in big bucks from issuing citations to drivers, and if robots are at the helm, it’s reasonable to expect that those figures would drop dramatically. A similar scenario is playing out in Colorado and Washington, where marijuana has recently become legalized, leading to fewer arrests, citations and fines.

While that seems like a great thing for the citizenry, it is having an impact on income for police departments. National Highway Traffic Safety Administration data shows that 41 million people are given speeding tickets annually, adding up to more than $6.2 billion in fines. If Google’s driverless cars have yet to receive a single citation out of all the hours they’ve spent on the road, police departments might need to find ways to reduce their budgets if they can’t count on revenue from citations.

Source: Justin Sullivan/Getty Images

Source: Justin Sullivan/Getty Images

As driverless vehicles and shared transportation resources become the norm in coming years, don’t expect the auto, insurance, or petroleum industries to sit idly by and watch their revenues dry up. Full-scale lobbying efforts will most likely take place, just as they have been mounted against the likes of Tesla, who also shook up the establishment with their electric luxury cars. The world’s biggest industries have traditionally not taken change lightly, and will fight to retain their share in the markets.

The more you think about it, however, the more it makes sense to move away from private vehicle ownership and towards shared transport options. Costs will go down, there will be much less strain on the country’s infrastructure — which is crumbling, with an increase in the gas tax  probably the only viable solution — and thanks to automated driving technology, accidents and deaths will decrease as well.

However, for many people — particularly in a sprawling, spread out country like the United States —  owning their own vehicle is absolutely necessary. For those living in rural areas, or that require a vehicle for work, maintaining a personal car or truck is something that they will most likely always do. But for people living in the cities, owning your own car may simply come down to a cost-benefit analysis.

Legislators in Helsinki are looking towards a car-less future for their city, and it appears that the plan will probably work. Can it be replicated in American cities? Some, maybe. But the U.S. is much different from Europe, and car culture is deeply ingrained in the American psyche. But that is less true for younger generations, particularly those raised in the city. As kids grow up in environments that have already adopted new technologies, and the ideas of driverless cars and shared vehicles is not as foreign as it may be today, every indication points towards a future with far less car ownership rates.

One point that hasn’t been brought up is the potential for cutting back on pollution. EPA regulations and state emissions standards have already helped curb pollution in many urban settings, and electric vehicles and hybrid technology will likely help further. With shared vehicles and increased public transportation options, an even bigger impact can be made in the curbing of emissions. With climate change on the horizon and increasingly-powerful natural disasters bearing down on the country, it really couldn’t happen at a more opportune time.

The idea of vehicles as a community resource, not public property, will take some getting used to, but it looks like it might be the future of transportation. Public transit options will also become more common as cities grow and owning a vehicle becomes less beneficial. It may take a generation or two for things to take place, but the wheels are already in motion, so to speak.

There will always be a portion of the population that will own and drive, their own personal vehicles. But keep an eye on what happens in Helsinki, as the Finns may be leading the charge into the next stage of transportation evolution.

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