A former member of the George W. Bush Administration, Eric Tanenblatt, makes the case that whoever owns the fleet of autonomous cars will own the future. And that this will be a massive change from the winners of the past, the automakers that sold their vehicles to individuals, and the winners of today like Uber, whose vehicles are privately owned by their drivers.
Ridesharers thrive today by assigning the responsibility and cost of ownership and maintenance to their drivers, but the radical shift to autonomous electric vehicles will require a fundamental business reorganization (or strategic partnership with organizations capable of marshaling and managing massive fleets, like automakers) that is in many ways antithetical to their low-cost structure today.
Within ten years of government regulators giving the green light to fully autonomous vehicles, the think tank RethinkX estimated in a new study this month that 95% of U.S. passenger miles traveled will be logged in on-demand autonomous electric vehicles owned not by individuals but fleets. The same forecast held that human-operated, internal-combustion vehicles (that is, conventional cars) will still represent 40% of the U.S. fleet, but account for only 5% of passenger miles traveled.
The transportation-as-a-service revolution has possible business-ending implications for the likes of Uber and Lyft. Barring dramatic and considered action, they’re hurtling towards the same fate as yellow cabs.
Characteristic of the same brash ambition that made it a household brand, Uber has begun developing a limited fleet of prototype self-driving vehicles, but hasn’t indicated to what extent its future would depend on fleet ownership. (Asked in an interview last year with Business Insider, Uber CEO Travis Kalanick said, “I don’t know who is going to own the fleet.”)
Kalanick doesn’t know who’ll own the fleet, and neither do I, but I can tell you this much: whoever owns the fleet owns the future.