In the 1960s, it was plastics. In the 1990s, it was ecommerce. And in the 2040s, many of the world's movers and shakers will likely be working on autonomous cars--at least according to one new study.
That study is called Accelerating the Future: The Economic Impact of the Emerging Passenger Economy. As you might guess from the title, it deals with a looming revolution in the auto industry: the shift away from private car ownership and toward rides on demand*.
The study was carried out by the market-watchers at Strategy Analytics, who reviewed current trends in ride-sharing and car-sharing; existing and emerging technologies; and the rate at which those trends and technologies are going mainstream. Here are a few of the study's major takeaways:
1. Self-driving vehicles will be widely deployed around the world by 2035. By 2050, they could represent half of all cars sold.
2. Self-driving vehicles will form a $7 trillion industry by 2050:
• Of that sum, over $3.7 trillion will be driven by everyday folks who've given up their cars and have chosen to rely instead on mobility services like today's Lyft and Uber.
• Another $3 trillion will come from business offerings, like shipping and courier services. (Think Amazon drones or Waymo and Uber's self-driving semis.)
• The remaining $300 billion will consist of new and emerging services--offerings we can't fully envision today.
3. While autonomous cars will undoubtedly cause a great deal of stress in the automotive industry, they'll have huge benefits for the general public, including:
• Fewer accidents: The most conservative estimates suggest that self-driving vehicles will prevent 585,000 roadway deaths between 2035 and 2045.
• A reduction in government spending: Safer roads will help governments save $234 billion on public safety programs between 2035 and 2045.
• Less urban congestion: Between 2035 and 2045, travelers will spend 250 million fewer hours stuck in traffic jams, providing more free time and potentially a boost to worker productivity.
What's driving the shift to the Passenger Economy? Strategy Analytics identifies four key factors:
Connectedness: Though we may talk a lot these days about disconnecting from the internet, in truth, our lives are increasingly lived online. This is fostering a paradigm shift in the way that we think about work, home life, family, friendships, education, and more. Living in the cloud, we become increasingly mobile, less rooted to one spot. As an extension of that, we become far more comfortable ditching conventional vehicles and ordering rides on demand.
Urbanization: By 2050, at least two-thirds of the world's population will live in urban centers. Cities will become increasingly crowded, and costs of living will soar. Add to that the fact that many cities will have well-developed mass-transit systems, and the need for private vehicle ownership will diminish.
Mobility as a service: Many people already use ride-sharing services like Lyft and Uber on a weekly, if not daily basis. The strength and popularity of those networks is likely to increase in the future--as is our view of them as viable alternatives to car ownership.
Regulation: As we've seen in places like Paris and London, many cities are trying to deal with a multitude of problems caused by automobiles, including congestion and pollution. As a result, they've begun restricting vehicle access in certain areas of town. Going forward, that's likely to become the norm in cities around the world, with autonomous ride-sharing services picking up the slack.
Is the study perfect? Of course not--but then again, can any predictive analysis like this be spot-on?
What's interesting, though, is that some recent data suggests that the switch to a Passenger Economy has already begun.
Want to know more? You can download your own PDF of Accelerating the Future here.
* Specifically, the study defines the Passenger Economy as "the economic and societal value that will be generated by fully autonomous (SAE Level five) pilotless vehicles."