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5 Effects of the Adoption of Autonomous Vehicles

Autonomous vehicles (AVs) are one of the most highly anticipated innovations in consumer products, and the wait is getting shorter. As this technology becomes accessible to the general public, the technology’s overall effects — whether positive or negative – are sure to be significant. The following five topics reflect how consumers and the U.S. economy may change.

Economic shifts

Research projects that the adoption of autonomous vehicles in business and consumer life will have a definite impact on the economy. A study by research group BCG predicts that by the year 2035, 12 million fully autonomous vehicles and 18 million partially autonomous vehicles will be sold globally each year. In this same timeframe, vehicles with autonomous features will hold 25 percent of the new car market, with market growth somewhere between $42 billion and $77 billion.

Jobs currently held by human workers – such as taxi or public transit drivers – could be replaced as a result of autonomous vehicles operating on their own. Self-driving automobiles have the potential for displacing human drivers if used for commercial trucking fleets, taxi services, and school and transit bus services. Farming, manufacturing, and construction workers could feasibly be replaced by autonomous vehicles that are designed to accomplish specific, repetitive tasks in those fields.

The loss of certain human jobs to autonomous vehicles represents only one side of the possible economic effect. For example, a winning proposal in the U.S. Department of Transportation’s $40 million Smart City Challenge for Columbus, Ohio, uses autonomous vehicles to connect unemployed residents in the Linden neighborhood to a job center nearby. Austin and San Francisco officials have plans to use new autonomous technology to provide transportation options to low-income residents.

Industrial changes

AVs are already spurring changes in industries that use autonomous fleets. The mining and farming industries have adopted autonomous vehicles in part because the technology is becoming more affordable, and AVs can operate on private roads where the risk of accidents is minimal. The use of AVs by mining companies increases worker safety in high-risk environments by taking operators out of areas where they can be submerged or trapped in collapsing tunnels. The benefits of using AVs in industry are wide-ranging, including saving on labor costs and reducing carbon dioxide emissions by as much as 60 percent through the use of optimized driving. In manufacturing and construction, similar benefits can come from the use of specific autonomous vehicles such as forklifts, loaders, and excavators.

Car insurance

Mainstream consumer use will influence how insurance companies conduct business. Because human-caused accidents would presumably decrease, insurance companies might rethink traditional business models. Experts have considered a possible shift toward insuring car manufacturers against liability resulting from technical failures associated with autonomous vehicles. Companies like Google, Mercedes, and Volvo have already begun self-insuring the products they make.

Driving safety

A major goal for driverless cars include a significant health and safety benefit – they’re expected to reduce traffic accidents and fatalities. According to the National Highway Traffic Safety Administration, 35,092 people were killed in 2015 in automobile accidents on U.S. roads. In addition to the human toll, car crashes have a substantial impact on the U.S. economy, costing an estimated $871 billion per year. A recent McKinsey & Company study found that autonomous vehicles and advanced driver assistance systems have the potential to reduce motor vehicle deaths by 90 percent, saving thousands of lives and roughly $190 billion every year in health care costs.

Commuters save time

Another benefit of AVs is predicted to take the form of time savings for commuters. Alleviating traffic jams and increasing efficiency in traffic flow can reduce travel times. According to the U.S. Census Bureau, Americans spent a total of 29.6 billion hours commuting in 2014. With driverless vehicles, a portion of this commute time can be used for working, relaxing, reading, accessing entertainment—having a better, more relaxed life.

While there are challenges and decisions to be made before their widespread adoption, autonomous vehicles will soon be a common reality. How their extensive use will impact business and the lives of consumers remains to be seen. To be sure, the benefit of increased safety for drivers and passengers, reduced labor and health care costs for business, and shorter commuting times for everyone seem too good to pass up.

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Sources

http://www.mckinsey.com/industries/automotive-and-assembly/our-insights/ten-ways-autonomous-driving-could-redefine-the-automotive-world

https://www.bcg.com/expertise/industries/automotive/autonomous-vehicle-adoption-study.aspx

http://www.digitaltrends.com/cars/will-self-driving-cars-cost-us-jobs/

http://www.digitaltrends.com/cars/autonomoy-will-change-the-way-you-purchase-and-finance-cars/

https://www.forbes.com/sites/patricklin/2016/04/25/self-driving-cars-wont-kill-insurance-industry/#7c1334eb746f

http://www.cnbc.com/2016/09/16/future-of-farming-driverless-tractors-ag-robots.html

https://www.forbes.com/sites/dougnewcomb/2016/10/13/obama-weighs-in-on-societal-and-economic-impact-of-self-driving-cars/#3b62a97868d8

https://www.washingtonpost.com/news/wonk/wp/2016/02/25/how-much-of-your-life-youre-wasting-on-your-commute/?utm_term=.aa6175d66a5e

https://crashstats.nhtsa.dot.gov/Api/Public/ViewPublication/812318

http://www.usatoday.com/story/news/nation/2014/05/29/steep-economic-toll-of-crashes/9715893/

https://www.forbes.com/sites/comcastbusiness/2017/10/05/for-caterpillar-autonomous-vehicles-create-safety-and-efficiency/#335c2ba666fe

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