Car rental and self-driving cars

Last week I was at registration for the Intelligent Transport Systems (ITS) World Congress.

It was a noisy bunch of people including vehicle manufacturers, infrastructure engineers, government officials, transport researchers and a wide range of others (like me). Everyone came from different backgrounds and places but they all wanted to talk about the same thing: self-driving cars.

Vehicle manufacturers are competing to become industry leaders in this field – and the technology is moving faster than government can legislate (nothing new there…).

Governments for their part are making massive investments into autonomous vehicles, launching pilot programs and developing test tracks (I think the largest is the 3000 acre one in Texas.. but apparently it’s always bigger in Texas). Cities such as Singapore are thinking about how they can remove cars from the street altogether and drive autonomous vehicles underground.

Heaven and Hell

The quote that stuck with me was this: “Heaven is self-driving public cars. Hell is self-driving private cars”. I thought about this afterwards and realised the impact… left unchecked, self-driving cars will dramatically increase the number of vehicles on the road. How? If somebody drives to work in 2016, they park the car in the morning and it isn’t on the road again until they collect it to drive back home.

In a driverless world, there is no need to park in the morning – the vehicle can head back home or run other errands until it’s needed again in the evening, spending more time on the road and contributing to extra traffic.

This problem becomes worse when electric vehicles are prevalent and the cost (environmental and financial) of running the vehicle is lower. For a more detailed explanation on the heaven/hell scenario read this article.

My thoughts? Within 12 months of driverless cars becoming mainstream, expect special taxes (per-mile or or congestion charges) for empty driverless vehicles.

What does this mean for car rental?

Driverless cars will happen to car rental without any special investment from car rental companies.. it will just be an option when the vehicle is purchased, the same way that GPS is now. How car rental companies can go further and innovate around driverless vehicles is a separate issue and one that we’re thinking about at Carcloud.