Philosophers and political writers have waxed on about the dawning of a new utopia since the beginning of history. Few, however, have had the guts, the hubris, or simply the fatigue-induced insouciance to stamp a date on it.
Today Morgan Stanley joins that few:
chart redacted
The chart above, released as a part of a note we covered earlier, shows that autonomous cars will deliver a Phase 4 utopia in just 20 years. We actually think Morgan Stanley is grossly underselling the technology. Here is how they define Phase 4:
Autonomous capability: This is an “ideal” world akin to common science fiction in which all cars on the road have at least a Phase 3 level of autonomous capability (including retrofitting older cars), full V2V/V2X capability and the ability to drive from Point A to Point B with zero human intervention.
Scenario: A family of four wants to travel from New York to Chicago. They have dinner at home, climb into the vehicle at 9pm, watch a movie projected on the windscreen, and then go to sleep in their fold-flat seats, waking up at their destination the next morning.
Functions: Fully autonomous driving with no human intervention, with the focus likely to be on lifestyle/entertainment of occupants and manual car control as a back-up/supporting function (or disallowed). Cars will look very different from cars of today. Cars can also travel with no occupants. Remote control/disable functionality necessary.
Ideal worlds should be made of sexier stuff.
But let’s start with the bit we agree on: Cars can also travel with no occupants.
Sort of how after filming a movie or TV show, it can “also” be viewed later by someone else at a different location. Or how, in addition to running an operating system, computers can “also” run applications.
What we think this means is that the entire concept of a car as an appliance is replaced by cars as the physical backbone of a transportation network or cloud. Our family of four does not climb into “the vehicle”. They order transport from their home in New York to the destination in Chicago.
A vehicle is routed to their home. It belongs to a massive fleet of vehicles — our family happens to prefer gPort, though iGo is the marquee brand. Driven-cars today spend most of their time idle. Such low capacity usage means that the effective user costs of capital are high. In contrast, peak-time pricing, thick urban markets and smart dispatching ensure that the vehicle arriving to our family’s home is in nearly constant use or cleaning. Importantly, the battery inside of it is always, but always, being used or charged.
The savings from efficient capital use pile up quickly. Let’s say the average cost of a new car in the US is roughly $30k. A family with two cars is looking at a $60k capital outlay (ignoring the staggering of vehicle cohorts). A very generous estimate would put each car on the road for four hours a day. The other 20 hours — that ‘s 86% of the day — are spent rusting away in a driveway, parking lot, or garage.
Rather than owning 100% of a capital fleet that spends 14% of its time in operation, the family could effectively rent 14% of a vehicle’s usage from a retail transportation company whose fleet was in usage almost 100% of the time. For the very same user cost of capital, the family could ride in a $360K vehicle. Or, more practically given the trends in inequality, the costs of transportation would simply fall dramatically.
Now, 100% usage may seem crazy, but here is where we get to the real integration between electric vehicles and autonomous cars. The cost of the electric vehicle is all about the battery. Because autonomous cars can also travel with no occupants, they can be programmed to return unfailingly to the battery-switching station the moment their errands are over. The previous battery begins charging, and the cars are fitted with a new pack sized for the next appointment. Here again, smart dispatching allows battery packs to be pooled for cost-sensitive, long-haul commercial transportation and peak-pricing shifts scheduled so that retail customers never have to wait for an open battery.
This is a revolutionary new experience, no longer designed around the twin needs of the driver to effectively pilot the vehicle, and of the vehicle to be left idle until a driver is available. What we have now is a playground on wheels, one that is more expensive and likely more fun than most folks’ homes.
And this is just on the retail transportation side. The real action is commercial, where — freed from the cost of the driver — the fleet of delivery vehicles can easily expand six-fold; autonomous cars can be sent on cross-continent or even cross-globe errands; and tons of prefab materials can be massed at more remote locations — Williston Basin, North Dakota — well in advance of human arrival.
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http://ftalphaville.ft.com/2014/02/25/1782472/are-we-there-yet-in-the-passenger-cabin-being-driven-autonomously-towards-utopia/
1. Alcohol sales are going to quadruple.
2. Pregnancy rates are going to go up.
3. What happens if little lucy has to pee 8 times an hour?
4. Is the convenience store as we know it, dead in the future? No QT? :(
