Self-driving cars excite me.
These moving objects, designed to carry people and stuff from point A to B without a human maneuver, are a sneak preview into the nearby future. Yet, for most people, they still sound like some farfetched utopia. But self-driving cars are coming. And probably sooner than you think.
Traditional car companies are trying to build cars with a computer. Tech companies like Tesla, Apple, and Uber inverted the innovation process by building computers on wheels. Current Tesla cars already have built-in LIDAR sensors. This means that an overnight software update can turn every Tesla car into a fully self-driving car without a mechanic ever touching it by hand. The biggest hurdle is not the tech and hardware anymore. It’s the trust of people and corresponding regulation. So we know fully autonomous cars are coming sooner than later. Let me philosophize about how these cars could change cities.
History teaches us that transport has always been quite influential for urban environments. In the 18th century horses were the main means of transportation. If those were not available people could still walk. It was way easier to move people around (they have legs) than it was to move stuff like raw materials around.
Trains were the main transportation system for stuff. But trains are limit to the local railroad infrastructure. These limitations moved factories to a centralized point in the city close to the train station. This was in the city and thus the place where factories would evolve. The heart of the Metropole was the place where people came to work. The downtown areas were often poor and had a lot of problems. The rich people didn’t live here of course. They were safely tucked away in the countryside, far away from the dirty factories.
The revolution of the car changed everything. But not in the way you would expect. There was this great inversion from both factories and people. They moved out of the center towards the suburbs. Not because people would now take the car to work. Factory workers were way too poor for that. No, trucks made it possible to move stuff around without using trains. For the first time, people could move raw materials around without the fixed infrastructure of a railroad. It was trucks that pushed the factory out of the city center towards the suburban areas.
Now you see this re-inversion and the rise of the ‘creative class’ (see Richard Florida’s book on the topic). In this new way of employment, the job is being creative and creating new forms of things. And with creative, I not mean musicians or painters. It’s much more. Jobs like lawyers, software developers, marketers, and tech entrepreneurs. It is service-oriented high educated knowledge workers.
All these people are coming back to the downtown area to live and work. It’s re-inverting the old inversion and creates this new rich class. Remember that the city centers used to be places where poor people lived. Now real estate in the city centers around the world is the highest it’s ever been. But remember that this creative class is small. The industry, and all the places where we actually still make things are located in the suburbs.
So is a driverless car more like a car or more like a truck? It will take quite some time before we see people spend the majority of their commute in driverless cars. What will happen a lot sooner is stuff moving around. And no, we won’t see pizza delivery in a driverless SUV. Our imagination is still quite shallow in that regard. The possible solutions are endless. Think drones moving your Amazon packages or little robots moving pizzas around. Moving stuff rather than people will be the first step in that direction.
And it’s already happening. We now use software as a way to move things to people, rather than people to the things. Take a look at Uber Eats or Deliveroo. Easy accessibility of food has lead to serious behavior changes in food consumption. It’s not people going to restaurants or buying food in the supermarket anymore. It’s food that is moving towards people. Currently via cars, or in dense cities via bikes. Deliverers move through the city based on an algorithm.
Why do you think Uber and Lyft are investing billions into self-driving vehicles? It’s labor that is the biggest expense. With self-driving cars, they remove the necessity for a human driver completely. Uber has the best knowledge of urban transportation in the world. And it will leverage that to remove their biggest expense: Their drivers.
So how does this change cities? Let’s say you want to start a restaurant. Instead of renting an expensive place, buying tables and hiring staff you slim it down. You rent a kitchen in the suburbs and just cook. Uber Eats will take care of the demand and all you have to do is cook. The economics of such a business is much less like a restaurant and much more like a factory. A food factory. With lower real estate costs, cheaper labor, and fewer upfront costs.
And guess what? Travis Kalanick, ex-CEO, and co-founder of Uber is currently ramping up a new company called CloudKitchens. The man who co-invented the algorithmic ridesharing revolution must know a thing or two about autonomous vehicles. After being pushed out as head of Uber, he is now working on this multimillion-dollar plan to build a worldwide network of food delivery kitchens around the world. He taps into the potential by buying real estate in less popular areas. He transforms these ‘hubs’ into fully equipped kitchens ready for food delivery.
With food and other stuff moving towards the people it is less important to be in the absolute city center. A place that is now dominated by this really thin later layer of rich creative higher educated people. What self-driving cars will do is give the suburban places the same quality of life in terms of service and delivery.
With fewer people owning cars the cities will change, parking spaces can turn into parks, and cities will be less noisy and polluted. People will be fine with living outside a city because if you can work during your commute you can live in more quiet and cheaper areas. These are all interesting consequences but as history tells us it will be most likely that stuff is the first thing that will be moved around fully autonomous. Following history, this will have large implications for sprawls of people. If stuff can come to you, and you don’t need to work in the city center why staying there? It’s more expensive and there is only this tiny group of people that actually wants to pay that price. Until now fully self-driving cars are still a utopia but they are coming. An over the air update can make the entire fleet of Tesla autonomous. Watch this space in the coming years, a lot will happen!