The Road to Fully Automated Cars: How Ride-Sharing Companies Will Pave the Way

Americans have quickly developed a high comfort level for the sharing economy. We now share our homes (AirBnB), our designer clothes (Rent the Runway) and, increasingly, our cars (Uber and Zipcar). And why not? Our cars are idle 23 hours a day, why shouldn’t we take advantage?


One of every five people in the US have participated in the sharing economy at least once, according to PwC. And 57% of US adults who are familiar with the sharing economy say access is the new ownership. This shift in perception is particularly notable among young Millennials, who are more open than older generations to using what Zipcar, the car-sharing program, calls “mobility as a service.” 

Yet, certainly, this is no niche market. In fact, Ford believes the transportation services market is worth $5.4 trillion. That’s why automakers in Detroit are partnering with tech companies in Silicon Valley to launch their own ride-share fleets.

The biggest and best-known name in the market is Uber, which has a market valuation of $68 billion. In addition, the company operates in 60 countries and 300 cities. Most recently, however, it sold its operations in China to Didi Chuxing. Aggressive pricing wars had caused it to lose $2 billion a year in that market, putting its potential initial public offering at risk. Instead, the company is focusing on other growth efforts, notably autonomous cars. The company is already testing its first driverless car in Pittsburgh and plans to launch a driverless fleet by 2030.

Ride-sharing service Lyft has been racing Uber across the nation. The company earned $1 billion in revenue in 2015, but more than doubled the number of cities it serves to 150 from 60. It too is investing in autonomous vehicles, working with General Motors – which invested $500 million in the company – to launch driverless electric-powered taxis in 2017.

But it’s not just tech and automotive companies venturing into this market. Automotive technology suppliers, such as Delphi, are implementing autonomous mobility concepts too. Delphi recently agreed to become a strategic partner with the Singapore Land Transport Authority (LTA), and together they plan to pilot a self-driving taxi program in Singapore, with plans to have it fully operational by 2022.

And there are plenty of others moving into the space, as well, several of whom may become household names. One to note is NuTonomy, a self-driving car firm spun off from MIT. It has already started to test a fully-autonomous taxi in Singapore, where it plans to launch “thousands” of the vehicles by 2019.

Not surprisingly, Zipcar, also is working on its own AVs. It has partnered with the University of Michigan Mobility Transformation Center, a collaborative organization working on smart cities and autonomous cars. Then there’s Zoox, a new startup that has raised $200 million for newly “reinvented” self-driving cars.

All of these efforts are likely to change the mobility landscape. Many industry insiders see ride-sharing services as the bridge to wider adoption of autonomous vehicles. As people begin experiencing these services in greater numbers and with higher frequencies, their comfort levels will rise. Over time, this exposure will generate trust and acceptance – and more automated cars on the road.


The road to Fully-Automated Cars for Ride-Sharing Companies

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