Though autonomous vehicles have hit the road in select markets, the industry is several years from reshaping corporate transportation policies. Some buyers and analysts, however, already have a vision of what ground transportation could look like.
Transportation tech providers have been pouring capital into self-driving vehicles. Uber, for example, has been testing the technology in several markets—including Pittsburgh, San Francisco, Toronto and Arizona—putting cars on the streets with drivers who can take over if necessary. Those tests hit a major setback in March, when an Uber self-driving vehicle killed a pedestrian in Tempe, Ariz., prompting the company to suspend tests. Around the same time, a test driver for one of Tesla’s autonomous vehicles died when his vehicle hit a lane divider in Mountain View, Calif.
Those investing in the industry note the high rate of deaths related to passenger-driven automobiles. Even if autonomous vehicles were never fatality free, they say, the rate of death still would be lower. Such accidents, however, also are reminders that this will not be a quick change.
Automobile industry insiders project it will be at least another few years before significant deployment of autonomous vehicles. A forecast in recent years by consulting firm McKinsey estimated that by 2030, fully autonomous vehicles could make up 15 percent of passenger vehicles sold around the world. Speaking at the Association of Corporate Travel Executives’ global conference in London last fall, Stuart Donnelly, then Fleet Logistics international sales director and now Sixt senior director of group international sales in Northern Europe and the U.S., said that prediction is optimistic. “It depends on the government infrastructure to enable that,” he said.
Regardless of how long it takes, autonomous vehicle technology and other automotive technology like electric cars will result in “massive, dramatic change” to the transportation industry, Donnelly said. For many, owning a car might cease to make economic sense, as could maintaining a fleet of company cars.
So, where does that leave the traditional car rental supplier? “Car rental companies are well positioned,” said ground transportation consultant David Kilduff. “Enterprise’s parent company EHI has a fleet of over 1.8 million cars; they have a huge footprint. How many will be automated depends on car manufacturers’ progress in AI. The difference is that EHI and other car rental companies are profitable now and can service the AI fleets. Uber and Lyft are still bleeding money” even as they rely on drivers to buy cars. That won’t change until driverless cars are mainstream.
Over time, autonomous vehicles will be of great benefit to travel managers, Ingersoll Rand director of global travel and fleet services Pascal Struyve said. They will resolve several issues around safety, he said, such as whether to allow employees to drive after long flights and vetting a ground transportation supplier on driver training and certification. Incorporating autonomous vehicles into managed travel programs or fleets, however, could be tricky depending on how deployment unfurls. “There’s a matter of when it will come and when will it become a valid solution in programs,” Struyve said. “Is it globalized, or is it great to have it in one market?”
Those are not questions he grapples with day to day, though. “We don’t think about it right now because it’s not, in the purest sense of the word, reality yet,” he said.
For those unfazed by the thought of a fleet of driverless vehicles, Uber, Airbus, a tech company financed by Google founder Larry Page and others are developing autonomous vehicles that fly. One, developed by a German drone manufacturer, took its first test flight in Dubai last year, and Page’s company reportedly was ready last month for test runs in New Zealand.
With 44 years to go before the real world reaches The Jetsons’ 2062, it looks like George’s flying car may be more believable than the fact that he had to drive it himself.
Self-Driving Cars in the Works
Addison Lee: The UK-based chauffeured car firm is working with Ford on a government-funded project dubbed Merge Greenwich that aims to understand demand and distribution strategy by tracking Addison Lee data while Ford concentrates on the automotive technology.
Lyft: Lyft opened an autonomous vehicle technology research facility in Palo Alto, Calif. It’s not developing its own vehicle but has opened its network to those developing the cars. It has worked with Ford as it tries to establish commercial service in Miami. Lyft and auto supplier Magna International also are jointly manufacturing systems for autonomous vehicles.
Nutonomy: Tech startup Nutonomy plans to launch paid commercial service in Singapore this year. The company also is testing its vehicles in Boston.
Uber: Uber put its autonomous vehicle tests in Pittsburgh, San Francisco, Toronto and Tempe, Ariz., on hold after one of its vehicles killed a pedestrian in Tempe in March.
Waymo: This year, Waymo expects to launch a driverless ride-hailing program in the Phoenix area. It began piloting the program last year.