5 min December 4, 2017 in

5 Industries Most Likely to Be Disrupted by the Onset of Driverless Cars

As with the recent increasing malware attacks, cyber security seems to be the main area to be strengthened within the driverless cars field.

This will lead to a boom in automakers’ partnerships with software enterprises, with IT shaping up to be the main industry influenced by the onset of autonomous vehicles.

But there are other industries at stake in this game.

Some of them will need to reconsider – or even shift – their long-term strategies, so as to adjust to the demands arising from self-driving vehicles usage.

In what follows, I’ll outline 5 of these industries, although there are many others to cast an eye upon.

1. Insurance

According to a Victoria Transport Policy Institute report, traffic-related fatalities are estimated to be reduced by 90% in the near future. This naturally increases the likelihood of insurance companies experiencing a significant drop in demand.

The fewer risks car rides will pose, the less people will need insurances.

In fact, insurance policy companies are already thinking this phenomenon through by advancing UBIs – Usage-Based Insurances. Also known as Pay-as-You-Drive (PAYD) and Pay-How-You-Drive (PHYD), the costs implied by this type of insurance depend on:

  • type of vehicle owned
  • time of usage
  • past driving behavior
  • driving destinations.

UBIs tend to reward safe driving patterns. But since ‘safe’ will more and more equal ‘self-driving cars’, we’ll most likely witness insurance agencies pushing UBIs so as to meet the needs of the new market.

Partly responsible for the challenges faced by the insurance companies is the fact that liabilities related to driving fatalities will be taken up by the automakers themselves.

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2. Ride-hailing

Both self-driving cars and ride-hailing companies have been working on groundbreaking models in transportation, so it is interesting to see how they will influence one another in the years to come.

With ride-hailing giants, like Uber, vying to get a leg up on the driverless scene, the relationship dynamic between the two industries seems like a win-win one.

But recent findings indicate that customers’ preferences favor well-established self-driving automakers to ride-hailing providers like Uber or Google.

The explanation is not hard to find: people tend to stick to what’s familiar and already reputable on the market. They will perceive a traditional carmaker brand as a safer investment.

Not to mention, Uber will need to start charging drivers in order to sustain production costs and research for their self-driving models.

3. Public Transportation

Using public transport will be an increasingly diminishing practice since people are already showing preference towards car pickup services.

Once these conveniences will be provided by driverless cars, they’ll prove even more advantageous due to a number of reasons like:

  • support of out-of-the-way locations not covered by the public network
  • reduced waiting time
  • cost-effectiveness
  • more mobility for suburbs inhabitants and commuters.

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4. Delivery

Dedicated delivery drivers can be worried about the future of their jobs – drones and self-driving cars are serious competition.

The main advantage of the latter delivery solutions is that they’re simply less prone to delays or human errors – not to mention time-effectiveness.

5. Urban Planning

Testing semi-autonomous cars has revealed that urban planning is instrumental in the vehicles’ swift performance.

Not in vain have cities like Pittsburgh been chosen as a testing ground by Uber. They present a wide range of urban transportation structures a driverless vehicle has to be equipped for.

That said, city roads will soon start to undergo a series of measures aimed at better catering to the needs of future transportation:

  • traffic lights redesign (or even elimination)
  • different traffic flow management systems
  • parking spots allotment.

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How about YOUR Thoughts on the Driverless Cars Onset?

The rise of driverless cars usage will not affect industries involving dedicated drivers only. They’re likely to also create numerous other ripple effects we can only have a guess at.

How do you see the whole suite of disruptive effects the autonomous vehicles are bringing?

Would you pick this means of transportation if being made available at a convenient price?

This is a topic we need to explore, so feel free to start any conversation in the comments section below.

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