The Societal Impact of Self-Driving Cars

Back before cars were invented, life was quite different. Most people never left their hometown and when they did, it was a massive ordeal. Life was much more local — good were produced locally, your personal and professional network was local, services were delivered locally. Think about what life would have been like before cars. And imagine how much it transformed society when they were introduced.

An interesting considerations is putting yourself in the shoes of someone in the early 1900s. What was life like back then? And if they were to predict how society would change, would they come even close? Probably not. Do you think they would have imagined:

• For someone that had never traveled more than a few miles from their home, imagine their understanding of the world outside their immediate surroundings. The concept of living a suburban lifestyle, going on road vacations, or accepting home deliveries from out-of-town produced goods would all be unfathomable.
• Imagine telling someone in 1900 about your hour-long commute to work and sitting in traffic. They might think you’re crazy!
• What about all the traffic fatalities and injuries over the years. These horrifying statistics might have scared people away from ever allowing cars to be invented.

The average person in 1900 couldn’t imagine life 50 or 100 years later. The way society transformed in every way — economically, socially, politically, and psychologically was profound.

And now we have self-driving cars on the horizon. It’s not too hard to believe that they will lead to a similar societal transformation.

Most people are focusing on the technology side of this invention. Which major tech company will win the race? How will they overcome the technical challenges and ensure performance and safety? Will regulators allow vehicles on the road? All of this is very interesting. But few are considering the huge ramifications self-driving cars might have on our lives (beyond the obvious).

Any revolutionary technology has unintended societal impacts. Some are good and some are not. Most are somewhere in between, with both positive and negative consequences.

So I want to think ahead and make my own predictions for self-driving cars. What will be the unexpected societal impact, many years down the road? Let’s explore…

1 — Migration away from the city.

A lot of people disagree with me on this point and I believe their argument has merit. But I predict we’ll start seeing an urbanization decline, with self-driving cars as a main factor.

The biggest reason people move to cities is convenience. It is convenient to live near your job (and urban areas supply the most jobs). And it is convenient to live near all the social, entertainment, and commerce benefits that a city offers. But take away the convenience and I believe most would prefer to avoid the crime, traffic, pollution, crowding, and small spaces common to many cities.

So assuming we have a much more convenient transportation mechanism, why would people opt to live in a city? If everyone uses a self-driving car, we will drastically cut transportation times. They will be configured to maximize route, will avoid human error that causes traffic delays, travel at higher speeds more safely, and be connected to traffic optimization algorithms. And self-driving cars will also enable self-driving buses, trains, and maybe even flying vehicles someday.

This points to less urbanization. In today’s world, it can take an hour or longer to go from one side of the city to another. But in a hyper-optimized transportation world, you can live 50 miles outside a city and travel there in 20 minutes. No longer do you need to live close to work or the best social scene. You can get the benefits of living away from the city combined with the convenience that a city currently offers.

All this points to less urbanization (or at least less congregation around the center). Self-driving cars are only one factor pointing toward this trend. For more on this, I wrote an entire article about this subject — Peak Cities: Prepare for Urban Flight.

2 — The rise of remote work arrangements and contract work.

This sounds counter-intuitive when thinking about the first point above. But bear with me. While it will be easier to get to work, I believe self-driving cars will accelerate an attitude-shift.

As a society, we are used to getting our way. Every bit of information and convenience is available at our fingertips. Instant gratification. Another term might be “entitled”. Self-driving cars take that to a new level. With transportation being as effortless as online shopping, communicating with friends, and other recent conveniences, it will have similar human psychology effects. People will begin questioning why they need to transport over long distances at all. And they will prioritize that in their work life.

I think we will become a bit entitled with how we work. We will demand remote working arrangements because we will simultaneously demand transportation ease.

The technology is already available for remote working (and VR/AR will amplify those tools). We just need the societal attitude shift to make it the default option. I think the self-driving car provides that attitude shift.

3 — Attitude shift = mass changes in the broad auto industry.

I could write an entire article about this one so I’ll summarize. In today’ world, we buy cars on a regular basis. Each family owns or leases 1–2 cars and replaces their vehicles as the newer models come out. We also have a big industry around servicing those vehicles.

But consider the possibility of a mass societal attitude shift toward car ownership. What if it’s substantially cheaper to use an Uber-type service with a mass fleet of their autonomous vehicles? Why would anyone choose the higher-cost, higher-effort ownership option? The implications would be substantial:

• Many fueling stations might go out of business. If auto ownership is centralized and errs toward the lower cost electric option, we no longer need much fuel.
• All the local, independent auto mechanics go out of business. Mechanics will still be needed but will likely work in a centralized service factory for the dominant fleet company.
• Most of the manufacturers will go out of business. Most countries only have 1–2 dominant ride hailing services. The ride hailing services will inevitably start manufacturing cars or have select partnerships rather than the extensive choice we see today.
• The dealerships will certainly go out of business. Buying will exclusively take place from the fleet company.
• Auto lending companies will no longer be needed if society foregoes ownership.

The auto industry is huge today. It revolves around direct consumer ownership, servicing, financing, and exchange. While some will still opt to own their own vehicle, I expect the masses to choose convenience and cost efficiency. Thus, we’ll see a pivot within the industry.

All is not lost in the industry. Car use will be greater than ever before. And the industry will pivot to user experience. Car design will change completely. Nobody needs to sit in an uncomfortable seat anymore. Cars will be designed around greater leg space, the ability to move around, and entertainment options in-car. We might be watching tv, playing video games, reading books, and using VR in the car. I see cars getting bigger because they become focused on comfort.

Likewise, there will be an entire service industry dedicated to self-driving vehicles. Just like radio caters to the current automobile configuration, new services will be available to cars. Might there be in-car coffee machines? Or in-car refrigerators? Or who knows what else people think of!

4 — Debt reduction and deflation.

Self-driving cars will likely help the common household economically. The reasoning is extensive:

• Auto ownership is a big household expense. We have big auto loans, insurance, fuel, maintenance, etc. I expect expenses will pivot toward a subscription model or pay-per-use model. With large fleets dominating the road, they will be able to scale all these costs. The consumer price will likely drop substantially in making this an appealing option to the masses.
• If people migrate out of cities (see point 1 above), real estate costs will diminish substantially. Urban costs will probably stay quite high due to tourism demand. But for those moving outside city centers, home prices and their accompanying mortgage payments will likely drop. The reasoning is simple. We will take greater advantage of remote land. This is a household’s greatest debt and I see substantial reduction.
• Consumer debt for financing discretionary items is a little harder to predict. On the one hand, if households have less financial burden from home/auto expenses, they will have more money for discretionary purchasing. On the other hand, we might see deflation across the board. I expect the AI technology that enables self-driving cars to revolutionize other industries as well. As AI increases efficiencies in the production and distribution of every good (by several magnitudes), it leads to inevitable price decreases. I see a widespread deflationary effect. However, past technology advances resulted in consumer debt increases. So I’ll just predict that things even out and it remains similar to current levels.

5 — A key economic factor for China.

There are four facts that are pretty indisputable about China. First, they have a huge population (the world’s largest). Second, they have a large country by land size (4th largest). Third, they have invested substantially in their infrastructure over the past 20 years. They have many new roads and even new cities. And fourth, they have built most of their economy around large manufacturing centers in their cities.

The self-driving car fares well for them on all accounts. It creates efficiency among their huge population. That allows them to better utilize their human resources (their greatest economic strength). It allows them to disperse those human resources across their country a bit better (and bring economic prosperity to more than just the Eastern cities). And their infrastructure investments will be fruitful for these vehicles to operate on.

China is already betting big on this technology and many believe they are winning the overall AI race. I believe China will benefit most from the self-driving car. And their government can efficiently clear the regulatory hurdles to implement them. I foresee them embracing this technology and thriving as a result.

6 — Autonomous and ultra-efficient delivery transforms everything.

In today’s world, we have a narrow definition of delivery. It might be instant food like pizza. Or it might be delivery of goods — everyday mail and package order delivery from e-commerce stores.

But delivery can evolve far beyond these small conveniences. And it is made possible by autonomous vehicles.

• Food delivery goes far beyond today’s version. In the future, we’ll be able to schedule every meal in advance and have it placed on the table at the time of our choosing. All this will be done without a human involved. You specify what you want, robots cook the food, and autonomous vehicles fly or drive it to you with perfect timing precision. Unless you choose to store food or cook, you will have restaurant-quality food waiting for you on the table whenever you want.
• Medicine evolves. Emergency services will be more efficient than ever before and likely integrated into the wearables/ingestables that monitor your vitals. All the services provided by a hospital might be remote in the future. Ultra-efficient transportation enables real-time delivery of anything you need and transport when you need human intervention.
• Integrating autonomous delivery into the Internet of Things, we’ll get instant delivery of anything we need. Did something in your house break? The sensors in that object will have a replacement delivered before you know it (or auto-deliver a person to fix it). Need a refill on your prescription or need more food/drink delivered to replace what has been consumed? Again, that will be monitored and automatically replaced.

7 — Education changes drastically.

We currently go to school locally because it’s the only option logistically. It’d be impossible for parents to drive their kids any meaningful distance and then go to work. But self-driving cars can change that.

Send your kids to the best schools or teachers, wherever they are. You’ll have all the safety features to make that possible and enticing. And parents won’t have to lift a finger in the process. Your kids might even rotate among locations. Why do we need all the teachers and education facilities under a single roof? Wouldn’t it be better to learn biology at the zoo or in the forest? Or chemistry in a real lab? History at a museum with real artifacts?

Education is obviously sub-optimal in today’s world and bound to change. VR/AR will revolutionize the delivery into experiential learning and scale the content possibilities. But primary education requires physical learning as well. And it doesn’t have to be from a single teacher in a classroom at a local facility. We can derive a better education for our kids. Automated transportation makes that possible.

And while this example focused on primary education, there’s no reason the same concepts can’t be applied to the university, adult learning, or business training.

8— Final demise of the radio industry.

I still think audio content has a nice future. Podcasts are extremely popular and many people prefer audible books. Music services like Spotify and Pandora are very successful. However, when people choose these, they are searching for a specific topic or listening for a specific purpose. The radio is different. People have the radio on by default while in the car.

But if you can turn your attention away from the road and re-focus on in-car entertainment, why would you choose the radio? You can choose whatever song or playlist you want rather than a music station. You can choose a specific personality or subject via podcast. And you certainly won’t need radio helicopter traffic reports anymore. If cars are truly autonomous, you could even choose television, the internet, or another entertainment form.

Some popular radio programs may survive. But the industry will begin declining and will be unrecognizable within a short time frame.

9 — Attitudes shift.

How will this technology affect our relationships with family, friends, and community? Will there be political impacts? What new industries will this facilitate? How will lifestyles change?

I don’t want to predict anything on these topics because self-driving car technology won’t exist in a bubble. We’ll have VR/AR, other AI, blockchain, 3D printing, robotics, the Internet of Things, drones, biotech, and much more. There is too much emerging technology and too many trends to consider at once. But the long story is that we’ll see many other changes beyond what I predicted. Some will be good and some bad. Some will be unintended. Others will be unfathomable by today’s lifestyle.

It’s no different with any technology shift. The world changed in almost every way from year-1900 living, as the automobile came into widespread use. And other major technology inventions (television, internet, etc) all ushered in their own societal transformation.

But I can say one thing for certain. Human attitude will shift due to self-driving cars in isolation. And they will certainly shift with all the other emerging trends and technology.

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