I Will Never Own a Self-Driving Car (and Neither Will You)

Self-Driving Cars: Why you will NEVER buy one…

There’s been a lot of talk and press lately about the coming revolution known as the autonomous drive vehicle (a.k.a. self-driving car). It’s coming. You cannot stop it. Despite your personal feelings, we will have more than a few self-driving cars on the road in the next 5-6 years. More importantly, in about 10 years, self-driving cars will likely be as ubiquitous in some cities (think Manhattan) as taxis.

Now that we got that out of the way, it’s important to also understand you and I will probably never buy a self-driving car.

In my opinion, there’s no use debating the merits or certainness of autonomous vehicles: they will be an improvement over today’s alternatives; they are coming and there is really nothing you can do about it. To me, quibbling about self-driving cars today would be like debating the pros and cons of the Internet in the early 1990s in some lame attempt to sway public opinion against going online.



You don’t have to be in favor of autonomous vehicles to see this, but it does help.

The autonomous vehicle naysayers are pretty funny to me. Kind of like my Mom in 1985 when she asked, “Why would anyone ever have a computer in their home?” Or in 1995 when she wondered aloud, “Why would anyone want to buy a book over the internet when you can just go to a bookstore?”

The two primary types of detractors today range from those who claim the pleasure of driving is too great to ever give up their 370z, to those who say they “don’t want machines running the world.” Both of these camps claim they will NEVER buy a self-driving car.

And… they’re right. They will never buy a self-driving car and neither will you.

People Won’t “Own” Self-Driving Cars

The biggest point that naysayers miss when considering the future of autonomous vehicles is that (for the most part) consumers will not own these. If companies like Google and Apple (and a dozen other tech-types) envisioned that the future of these vehicles was a one-time sale, some service business over the years, and then a trade-in on a new one, they would never consider jumping into autonomous vehicle development. The long-term revenue stream and the market share expectations would be too small to attract these behemoths. Speedometer

Self-driving cars will be owned by the manufacturer (or, more likely, some subsidiary of the manufacturer). You see, while there is some money to be made in selling a few million cars over ten years, there is exponentially more money to be made in providing the transportation services to perhaps 100 million people over those same ten years.

Yeah… But Why Won’t I Just Buy One Myself and Skip the Middleman?

Simply put: cost.

It will be more than just a few bucks cheaper for you to outsource your transportation needs to a Google or an Apple than it will be to buy an autonomous vehicle, charge it, repair it, insure it and watch it depreciate in your garage while you use it for a couple of hours each day.

Not convinced? Consider a few of the benefits we’ll enjoy with self-driving cars in about 10 years:

  • A vehicle will be at your disposal 24/7. The providers of self-driving cars will also provide a service much like Uber does today. They’ll have vehicles stashed throughout your city so that when you order a ride via an app, a car will be at your door in minutes.
  • Insurance costs will plummet. There is no doubt that autonomous vehicles are infinitely safer than those driven by humans; but also remember that a fleet owner (like a Google) will enjoy much lower insurance rates per mile driven than any single consumer because of their sheer scale. (Of course, these entities will self-insure – lowering their costs even more.)
  • Fewer traffic deaths. This benefit will be both huge and largely unnoticed by consumers. Statisticians, government agencies and insurance companies will notice; though those of us not killed in the accidents that were avoided because of self-driving cars will be clueless. (After all, nothing happened, right?)
  • No driver means no labor costs. There are lots of reasons you don’t abandon your car today in favor of using taxis (or even Uber); though the biggest reason is most likely the cost. Why would you spend $50 or more for a quick trip to and from the grocery store when you can drive yourself for less than $15? Well, with an autonomous vehicle (and no driver) your cost will be roughly the same (or less) as driving your own car.
  • Vehicle repair costs will be much lower. Beyond the scale of maintaining an enormous fleet of the exact same vehicles (all with interchangeable parts), the autonomous vehicles will be much cheaper to maintain because (A) they will be regularly serviced at prescribed intervals; (B) they will drive themselves to the service facility as soon as there is the potential for an issue; (C) they will always be driven in accordance with manufacturers’ recommendations; (D) they won’t cause accidents; and (E) they will all be electric vehicles with fewer moving parts.
  • Cars with a million+ miles on the odometer will become commonplace. Because of the regular maintenance, the self-driving cars in any fleet will routinely log more than a million miles before being replaced. In fact, it’s likely these vehicles will never be fully replaced, just continuously upgraded. Don’t believe me? Think about the airlines like Delta or American. Because of their regular maintenance it is not uncommon for you to be flying in a commercial aircraft built 25 or even 30 years ago. Over the course of its life, a commercial aircraft is likely to log more than 50 million air miles.

Okay, But Where Will They Park, Charge and Repair These Vehicles?

As far as parking and charging, most self-driving cars will use your house (or my house, or my neighbor’s house or your neighbor’s house).

You see, the enormous fleet that a Google might manage needs to be spread throughout the city at all times; and while they will likely build and maintain a number of giant centralized garages for some parking and charging (and all repairs), the need for on-demand service will require that they contract with you and me to allow charging and storing on our driveways.

In both the short and long term, it will be cheaper and more efficient to mount solar panels on the roofs of interested consumers’ homes, add a storage battery and charging station, and then trade some free electricity for the right to park a few self-driving cars on their driveway or in their garage.

Remember: because we no longer own a car, our driveways and garages are pretty much just being wasted anyway, right?

Okay, You Convinced Me. Now, Who Will the Winners and Losers Be?

Well, I’m glad you came around to my side on this. To understand which industries will see the greatest impact from the self-driving car revolution, please read my next post: Self-Driving Cars: The Winners and The Losers.