Electrifying Rides & Robotaxi Growing Pains: Key 2024 Mobility Trends

How the trials and tribulations of emerging mobility solutions are steering us closer to the “Remixed City”

Richard Yao
IPG Media Lab

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The last time I wrote about the mobility space at the beginning of 2023, the industry was scaling back its autonomous vehicle (AV) ambitions after major setbacks to focus on more practical goals, such as expanding electric vehicle (EV) infrastructure and enhancing digital in-car experiences. Amidst the EV surge, companies like Uber and Lyft were encouraging the transition to EVs with specific programs and incentives. Meanwhile, the charging infrastructure was rapidly expanding, with projections of over 40 million global charging stations by 2030, and brands like Starbucks and Amazon entering the space to enhance customer experience and accessibility.

A year later, the future of mobility seems just as in flux as before: The growth of EV sales is slowing down in the U.S., with some automakers blaming weak demand and slashing production, whereas the rollout of self-driving cars in the forms of robotaxi services has been fraught with tensions and setbacks, as public backlash over safety and ethical concerns continues to pose significant hurdles to widespread adoption.

Yet, there is hope on the horizon. In recent months, Tesla has rallied all major car manufacturers to support its NACS charging standard to boost interoperability between EV charging stations, laying the technical foundation for a more unified and user-friendly EV infrastructure. This move promises to streamline the charging experience across different brands, potentially addressing range anxiety, one of the main pain points for EV owners and prospective buyers.

Meanwhile, the potential disruption of more affordable EVs made by Chinese manufacturers such as BYD entering the US market is whipping US automakers into a frenzy. BYD has recently surpassed Tesla to become the world’s top EV seller, and it is reportedly considering establishing an EV plant in Mexico to use as an export hub to enter the US market without high tariffs. Once Chinese EVs eventually make their way across the US-Mexico border, the low-cost models around which China has built a leading EV market are likely to undercut offerings from the likes of Tesla, GM, Ford, and Stellantis, putting downward pressure on pricing on all the EV models and opening up the EV market to new U.S. buyers.

The Vision of the Remixed City

On the automation side, while robotaxis continue to face setbacks, driverless delivery vehicles continue to make progress. Nuro, a autonomous delivery company founded by two veterans of the Google self-driving car project that would later become Waymo, recently announced its latest innovation, the 3rd-Gen Delivery Robot, integrating Arm’s automotive technology to achieve greater power efficiency and cost-effectiveness in scaled manufacturing. By collaborating with Arm, Nuro aims to enhance the R3 robot’s efficiency and range by up to 20% while retaining the current battery size. The company’s existing fleet has already surpassed 1 million autonomous miles in California and Texas. Although Nuro teases that it is open to exploring broader applications like passenger vehicles, it continues to prioritize grocery delivery as its primary service.

Moreover, 2024 is poised to be a breakout year for delivery drones. Last year, the Federal Aviation Administration (FAA) removed a key regulatory hurdle by allowing select drone companies to operate beyond the visual line of sight. This development eliminates the necessity for human observers to be positioned at intervals along a drone’s flight path, a requirement that was previously impractical and financially prohibitive, hindering the scalability of drone delivery services. In January, Google’s Wing debuted bigger delivery drones to take advantage of this permission to fly longer distances. Meanwhile, Walmart recently expanded its partnership with Wing and Zipline, another drone delivery service, to cover up to 75% of households in the greater Dallas-Fort Worth area.

These two recent developments in automated delivery solutions are representative of the type of advancements that we highlighted in the Remixed City section of our Outlook 2024 report, in which we noted:

As autonomous vehicles (AVs) become more of a reality, we’re seeing increasing investment from companies like Kia and Pix to leverage AVs into platforms for popup retail stores, like farmers markets and food trucks.

Of course, innovations in mobility extend beyond the retail space. As cities work to improve their public transit infrastructure, and prioritize biking and micro-mobility options, the suburbs and exurbs are on the verge of another kind of revolution.

Over time, autonomy will change our cities and suburbs, and will introduce new business models for mobility, including the idea of a mobility super bundle, encompassing multiple modes of transport for one monthly fee. It will also change the media we consume, giving us more time for video content and games.

In order to get to this future of a reimagined urban life powered by advanced mobility solutions, however, we’ll first need to overcome the hurdles surrounding the adoption of autonomous vehicles. Without AVs being embraced as a mainstream mode of transportation, none of the proposed innovations in urban planning, popup retail, and lifestyle changes may materialize.

Robotaxi Growing Pains

Let’s start by addressing the growing pains that robotaxi companies have been grappling with. The tension between rapid technological advancement and ensuring public safety underscores a complex path forward for robotaxi services, as they struggle to integrate seamlessly into the existing transportation infrastructure in American cities.

By now, you’ve probably heard of the Waymo self-driving car that was vandalized and set ablaze in San Francisco in early February while a crowd reportedly cheered on. While the motivation behind this Luddite-y act of rebellion remains officially unspecified, it is easy to discern when placed in the context of the growing tension between the city’s residents and the robotaxis roaming the streets.

Notably, this incident took place just a few days after a Waymo robotaxi hit a cyclist in the same city — luckily the cyclist only suffered minor injuries — prompting another wave of outrage directed towards the likes of Waymo and GM’s Cruise, which had been granted license by city officials to expand their driverless taxi services in the city 24/7 last summer. Following the incident, the California Public Utilities Commission (CPUC) suspended a request by Waymo to launch its robotaxi business in more cities within the state.

Besides this fiery provocation, the robotaxi sector has suffered a series of setbacks in recent months, including an awful October incident in which a Cruise robotaxi dragged a pedestrian underneath the vehicle for 20 feet. Meanwhile, In February, Waymo filed a recall notice with the National Highway Traffic Safety Administration over a software issue connected to a pair of crashes in Phoenix, Arizona, where Waymo was granted license to offer driverless rides on the city’s freeways.

Placed in an even broader context, the underlying tension also points to an eroded public trust in big tech. Whether it’s fear and concern over AI-generated content, labor practices at companies like Uber and Amazon, and issues with misinformation from platforms like Facebook and TikTok, there is an undeniable wave of skepticism against the techno-utopian promise of “making the world a better place” through tech innovations alone.

Compared to those software-oriented innovations, self-driving cars are, of course, being held to a much higher standard, considering it could be a literal life-and-death situation on the road, should the self-driving tech ever malfunction. Yet, self-driving cars are legally immune to traffic tickets in California, highlighting regulatory oversight and a general lack of accountability. The mere presence of a self-driving car on the road, with its eerily empty driver’s seat and the elaborate set of camera systems atop, underscores and amplifies the growing perception that big tech wields excessive influence over everyday life, with little to no recourse for the average person to repeal.

The Paths Toward Maturity

All these contentions won’t be easily resolved, and the industry will need to take some accountability and actively work on measures aimed at alleviating the growing tension and skepticism. Patience and grace for experimentation from all sides will be needed for us to navigate the complex relationship between innovation and public safety and help AVs outgrow its awkward teen years.

One potential solution is to introduce self-driving tech to public transportation. For example, San Francisco launched a driverless bus service following the robotaxi expansion in August. The free shuttle runs daily in a fixed route called the Loop around Treasure Island, the site of a former U.S. Navy base in the middle of San Francisco Bay. The Loop makes seven stops, connecting residential neighborhoods with stores and community centers for the 2,000 residents who live on the island as well as the visitors. The all-electric vehicle doesn’t have a driver’s seat or steering wheel, but it is staffed with an attendant who can drive the bus with a handheld controller if necessary.

As AVs stumble closer to the mainstream, it will be interesting to consider new ways of sharing vehicles with people in your own communities — whether it’s people in the same residential community, the same co-op building, working in the same company, or simply with friends and neighbors through a co-ownership model. It’s easy to envision employers or management of residential communities offering AVs as an amenity, as the aforementioned Loop bus service demonstrates.

Another route of easing tension to pave the way for AVs would be to build trust between consumers and AI through value-adding use cases. AI’s impact on mobility at large is only going to increase. From automakers adding ChatGPT into the car dashboards to Google Maps being supercharged with generative AI to offer conversational suggestions, automakers are already establishing a throughline that ties the dashboard experience to the driving experience itself.

Moreover, as AI becomes more integrated into various aspects of the driving experience, from route planning to predictive maintenance alerts, it stands to not only entertain but also to inform and reassure passengers about the capabilities of AI. By familiarizing users with AI’s benefits in a controlled and transparent manner, trust in the technology’s reliability and safety may gradually be fostered.

Through continuous improvements and open communication, AI can shift from being perceived as a disruptive force to being embraced as a valuable co-pilot in the journey towards a more automated future. This shift is critical not only for the acceptance of AVs, but also for the broader vision of urban mobility, where AI is needed to manage a complex system of diverse transportation modes.

If you want to learn more about the emerging EV ecosystem, or want to chat about the future of mobility and how to future-proof your business, please reach out to our content manager, Richard Yao (richard@ipglab.com) and ask for our latest category disruption report on this topic.

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