Not the Road Ahead

A broad claim made in favor of autonomous vehicles (AV) is that their eventual deployment will usher in a massive reduction in national vehicle fleets. It’s an appealing image: our cities emptied out of excess vehicle inventory, and lots of real estate and automobile infrastructure converted to human-centered uses.

In September of last year, the co-founder of Lyft, John Zimmer, wrote a long piece on Medium in which he laid out this very vision. The Road Ahead has the familiar appeal which prosaic, silicon valley forecasts are very good at producing. Autonomous vehicles will quickly become widespread, and account for the majority of Lyft rides in five years. By 2025, private car ownership will all but end in major cities. There’s no question that AV are coming (though not nearly as quickly as many forecast). And I agree that both EV and AV will find their high adoption rates first, in global cities. But something about Zimmer’s precision struck me as too confident. And in particular, his accounting for the number of citizens that would shed car ownership. The idea that cheap and available AV would only usher in car-shedding struck me as one-sided.

This week, in a detailed report on the rise of TNC (Transport Network Companies) in New York City, we have a better picture of the neglected side of the AV rollout equation. According to Unsustainable, a detailed ridership and impact study conducted by Schaller Consulting, the success of Uber, Lyft, Via, Gett, and Juno in the five boroughs has uncovered demand not from riders looking to shed car ownership, but from transit users looking to take a cheap car ride. According to Schaller, the marginal growth among competing transport options in New York City began to tilt slowly towards TNC in 2014, and then really accelerated in 2015. So much so, that marginal growth in bus and subway ridership slowed considerably. And by 2016, TNC were trouncing, at the margin, both buses and subways.

| see: Figure 12. Changes in ridership by mode, 2015 to 2016.


I agree that AV penetration will impact the inventory of existing cars. But readily available and affordable AV will also impact the inventory of users who don’t own cars. You could argue that New York City contains the largest population of car-less users in the country. But you would also have to allow that latent demand for car services can be found in all cities; and if prices for TNC fall—regardless if fleets are AV, EV, or still have drivers—the impact of those falling prices will uncover growth in this latent demand. It’s already happening, in New York City.

The advent of AV and EV will offer significant gains to society and well being. But the claim that urban congestion will be solved by AV in revolutionary fashion needs to account for the phenomenon of induced demand, and cannot rely on one-sided arguments that concentrate only the size of existing vehicle fleets.

–Gregor Macdonald

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