20 years ago I was offered the opportunity to get in on the ground floor of a business that had a new idea, selling people goods ordered from their computers. While I was certainly by no means a Luddite, I could not envision a day where people wouldn’t just drive to the store to buy the things they needed. About that same time, a guy with a business plan like the one pitched to me started hawking books out of his garage. That guy made the news recently for briefly claiming the top spot on the world’s list of richest people, so good call by me back in 1998.
Despite all I read about the future driverless cars, it is still hard for me to picture it happening. Don’t get me wrong; I would much prefer to read the paper or take a nap on my daily commute. Problem is, I just can’t see the possibility of the day where I actually could ever coming to pass. However, knowing my track record on being able to spot emerging advances, I know that it will.
How the World Will Be Different With Driverless Cars
As with any paradigm shift, people often tend to focus solely on how they will be affected. I love buying things online now, especially as it has gotten to the point where I can receive items at my front door almost as quickly as if I had taken a trip to the store to get them myself. Unless it is brought to my attention, I spend little time considering the effect my shift in buying habits has on retailers, their business practices and way of life.
Driverless cars have the potential of creating a huge ripple effect across the economy. Here are a few of the industries that will be facing a radically different landscape when the self-driving car becomes the norm.
Parking – 144 billion square feet of the United States is dedicated to parking. In some large cities, parking can represent up to one-third of the total available real estate. If the future vision of the creators of the autonomous car is realized, one day your car will drop you at the front door of your office and then go find a place to park or will remain in service for ridesharing while you work. If this becomes the case, it is estimated that the need for parking could be reduced by about 61 billion square feet. Not only would this reduce revenues of the parking industry, but cities could also be hit hard when parking fines disappear. Had this happened in 2012, Washington DC alone would have lost $92.6 million dollars.
Law Enforcement – Much of the effort of local law enforcement is focused toward regulating traffic. Traffic citations perform two functions, they keep the driving environment safer, and they generate revenue for the city. Self-driving cars have the potential of reducing citations as well as drunk driving violations. This change could lead to reductions in force or reallocation of efforts to other public safety issues.
The Legal Profession – In the US, nearly 1/3 of all civil trials revolve around vehicle collisions. If the number of car crashes is radically reduced, personal injury lawyers will be significantly impacted. Currently, the 76,000 personal injury lawyers registered nationally represent approximately 6% of the country’s attorneys.
Online Commerce – Here is where my lack of foresight concerning both self-driving cars and people’s online buying habits meet. The day that drive time becomes free time, there’s a good chance that free time will be occupied with the driver on the Internet. A recent report by McKinsey and Company estimates an economic impact of $140 billion dollars if the average commuter spent just half of their time in the car surfing the web instead of actively operating their automobile.
These are but a few of the industries that will be forced to change the way they operate if self-driving cars become ubiquitous. By the way, business leaders in all industries would be well advised to examine their systems as it is looking less like “if” and more like “when.”