Since the carros were invented more than 100 years ago, the automakers' business model has hardly changed. And the self-driving car, where does it fit into the story?
In general, a factory produces a car and passes it on to a final consumer, most of the time with the intermediation of a dealership. Then, the following year, the automaker launches a more modern model and restarts its sales cycle.
Os engines become more powerful and efficient, the design becomes more attractive, new items of Safety and convenience are added, but at its core, the car is still very similar to those automobiles sold in the early 20th century. automakers, also.
A Auto Industry is also known as the industry of industries, “not only for its size and economic importance, but also for all the impact and influence it has on countless areas of the economy such as commodities, energy, credit, technology, etc.”, details Ricardo Longo, from Onoffre Consulting.
And all that changes when we start to assess what will happen in the next 10 or 20 years with the development of the technology of the autonomous cars. The idea of having a self-driving car that can receive updates during its life cycle it turns everything we know about the automotive industry upside down.
Does this mean automakers are going to die? Probably not. Someone will still need to manufacture all these parts and put them together. Cars will still ask for service maintenance, components will be changed and technical and mechanical improvements will continue to be developed. Activities such as design will also continue to advance within the courtyard of giants such as Ferrari ou Volkswagen. But will all this continue to generate money as before, in a future of autonomous and shared cars?
“If you pay attention to younger people, many of them no longer buy cars, especially if they live in big cities (…) If I'm living in New York, I don't want to pay to park the car or deal with a series of other problems that show up when I have a car", attests Sobhan Khani, responsible for the mobility area at Plug and Play, the largest startup accelerator on the planet.
The automakers' business model (make, sell, restart) loses some of its meaning when people stop buying cars so often. Still, no one is better positioned than they are to carry out activities related to manufacturing the vehicles of the future.
Autonomous cars and the future of the market
Experts work with varying scenarios as to whether we'll continue buying and driving cars for years to come. According to Sven Beiker, professor at Stanford University and director of Silicon Valley Mobility, it may take some time for fully autonomous cars take us from one point of the city to the other – which does not mean that we will not enjoy its benefits in the coming years. “By 2020, we will have self-driving vans that we can actually use,” says Beiker, considering the US scenario. In fact, Waymo (read Google) recently ordered 62 minivans from Chrysler and another 20 electric SUVs from Jaguar Land Rover to start operating with this type of modal in 2020.
If we just depended on technology, all this would happen even faster. About $45 billion was spent worldwide last year to develop self-driving cars. This investment has been made by automakers and, mainly, technology companies such as Uber, Google and Apple. Among the old guard players, the one that stands out is GM, which has already asked for permission to travel in the US, starting next year, with a model without a steering wheel and without pedals called Cruise EV.
Why are companies investing voraciously in this history of car autonomous? “We are in the middle of two very interesting trends – on the one hand we have mobility on demand and on the other hand we have autonomous cars”, describes Deepti Tiku, Director of Marketing at Ridecell, startup which operates carsharing services for giants such as BMW, for example.
For her, apps like Uber and Lyft are good complements for using a own vehicle, but they have not been able to fully replace car ownership. “The tipping point will be when autonomy comes into play. When we look at a service ridesharing, 70% of the cost refers to the cost of the driver”, he adds. Without a driver, these services would cost less than a third of today's prices. The same will happen with public transport, for example, in a slightly smaller proportion.
Consider a recent survey of the Ipsos, which indicated that Brazil is the leader in terms of “mileage traveled per person”, among 20 countries surveyed. Almost a third of the population travels more than 2,5 kilometers per month (with an expenditure of approximately R$XNUMX on fuel), a stretch equivalent to a trip from Floranópolis/SC to Palmas/TO. Autonomous and shared systems have enormous potential to make better use of all these trips – subtracting driver expenses from the equation.
What it takes for the autonomous car to be a reality
so that a technology becomes available to users, people need to be receptive to it. We have “a higher level of demand for decisions made by machines than for decisions made by humans, because machines should not make mistakes” explains Steven Choi, from Uber's autonomous car division. “Are people willing to give self-driving cars a chance yet? I think this will take a while,” he notes.
Moreover, drive a car it is an extremely dangerous activity, even in countries like the United States. “Tragically, we see on a daily basis that this is an unsafe activity, often for a variety of reasons. And the number one reason is human drivers,” corroborates Sven Beiker. We are, therefore, going through a scenario in which we recognize that a car driven by humans is one of the most unsafe things in our society, but we still do not trust this technology of the future that will put us inside cars without even a brake pedal to control.
If we took all vehicles from the streets, eliminate all permits to drive and leave only autonomous cars on the avenues, we would already have a safer system than the current one, according to experts. The difficulty is in making autonomous cars coexist with human-directed peers. It is this scenario of coexistence between the two models that we will face in the coming decades.
And, even in the distant future, we will probably continue to coexist with both proposals. If people want to have their own cars, will continue with the right to do so. It will be like in aviation: “not everyone has their own plane, but if people want to buy a plane and fly it, it is totally possible in modern society. However, most people choose to use an airline to travel”, compares Choi.
Detroit and car manufacturing
Detroit is the world symbol of car manufacturing. The city represents the automotive industry and all the importance that automakers had in the last century. But mobility as a service tends to change this scenario a little. Just as the aviation industry has a few manufacturers and dozens of airlines using aircraft, most revenue from the car market will be in the hands of operators in the future.
For example, the Boeing, the world's largest plane maker, reported a profit of US$8,2 billion in 2017. Delta, the world's 3rd largest operator, earned US$3,5 billion in the same period. Boeing is one of very few existing manufacturers and Delta is one of dozens and dozens of airlines.
From major players in the automotive mobility market, automakers are being challenged in their business model. If they do not transform themselves and take advantage of opportunities, they will remain on the margins of the segment. “We are already seeing automakers entering mobility services and technology companies also participating in this space. But this is not limited to these industries, in our experience. Last year we launched a car-sharing service for an insurance company that was realizing that, as people in the future may stop buying cars, this will affect their business”, reports Tiku, from Ridecell.
This integration is the key to the coming decades of companies like Ford or Hyundai. “We believe in collaboration. Especially, in the automotive industry, the future of mobility will not be in the hands of just one company that will be a winner, but in the collaboration between automakers, suppliers and content creators”, says Sobhan Khani.
In this scenario, some automakers are already positioning themselves as manufacturers, like Boeing. Others are looking at complementary models, like Delta. Even though they don't know very well what will work in the coming years, the sector's giants have been increasingly involved both in the development of autonomous cars and in other mobility alternatives such as carsharing, bicycles, rides and even flying cars. Which of these tests will succeed? That's a question worth more than a trillion dollars. For Ricardo Longo, “autonomous cars are here to stay and will be fully adapted in our society much sooner than we can imagine”.
By: Pedro Conte, journalist for PARAR Review
For you, what is the future of the Autonomous Car? Share with us in the comments!
