Paradoxically, here in early 2016, we are witnessing the lowest U.S. gas prices in years, but we are also moving toward a transportation era based on dramatically different economic premises, most obviously driverless vehicles. So it seems a perfect time to dig into the deep economics of cars, their impacts on city life, and what we can anticipate coming down the pike with the rise of driverless vehicles and smarter ways of living in cities once we can depend on AI-augmented transport.

Perhaps there is nothing so pedestrian as parking, a global phenomenon that we generally take for granted along with many of the other externalized costs associated with car culture. The hard fact is that the typical car spends 95 percent of its working life parked. This means that little of the value of the car is actually realized. And, according to the AAA, the average cost of owning and maintaining a mid-sized car in the U.S. in 2014 was almost $9,000, of which $1,300 per year goes just to parking! Therefore we should not be surprised that parking is a $100B industry. This despite the fact that as much as 98 percent of car trips — at least in Los Angeles — start or end with free parking, according to the California Household Travel survey.

Parking consumes a great deal of time, and according to Daniel Shoup, 16 studies from 1927 to 2001 found that 30 percent of the cars in congested downtown traffic were cruising to find parking, on average. He also notes that more recently, in 2006 and 2007, 28 percent of the drivers stopped at traffic signals in Manhattan and 45 percent in Brooklyn were searching for curbside parking.The average American takes four car trips a day, and if you figure two are commuting based, that can still translate into a half hour or more of looking for a space.

We seldom think of how much of our cities are given over to cars, but in one study it was found that 14 percent of Los Angeles is devoted to parking. Barclay’s Capital reported that we could see a 60 percent decline in the number of cars on the road, but the impact on parking could be much greater.

Obviously, the emergence of driverless vehicles suggests a great deal about the future of cities, and the impact on parking may be considerable. First of all, it’s clear that the on-demand car services like Uber and Lyft (along with car manufacturers like GM and Ford) have plans to provide driverless transportation to replace ‘drivered’ cars. That means that cars will not be parked after you get to the office, movie theater, or even grocery store.

One study suggested that a single driverless car could replace up to 12 drivered cars. Instead of being parked at some destinations, the driverless car will simply move on to the next pick up. Another consideration is that driverless cars may be folded into municipal transport plans, like trains, buses, ferries, and bicycles, and not managed like taxis or on-demand cars services, at all.

Even for those cars that are privately owned — which is likely to be a much smaller number considering how cheap Uberish services might be once the driver is out of the picture — driverless cars may be much more efficiently parked than human-managed ones, requiring dramatically less parking.



Source: Curbed Los Angeles

The frontiers of the future will be the ruins of the unsustainable.

One thing that is bound to change is the way that municipalities require a great deal of parking allocated for new housing, based on historic patterns. That is likely to change very quickly, and will immediately lead to denser and lower cost housing, even before our cityscapes are dramatically remade.

There are other very significant economic impacts that will arise from driverless cars. It’s been estimated that accidents will fall 80 percent in next 20 years as driverless cars sideline human drivers who are demonstrably terrible at driving. As a direct consequence, car insurance will plummet, with a drop from coverage of $125 billion in covered losses in the U.S. today, down to as little as $50 billion in 2040. But this is hard to predict, since we have no prior data. It could be much, much lower.

Source: The University of Texas at Austin

In the simulation above, we can get a sense of the driverless future. The white rectangles represent cars that have been ‘scheduled’ to pass through an intersection,while yellows have yet to be scheduled. But once scheduled, the cars are coordinated in their passage, so that traffic signals are not necessary, and the flow rate of the cars is much, much faster, without the need to stop once scheduled.

The economics of frictionless traffic — without traffic lights, traffic jams, and built-in delays — is another large factor in the net savings from driverless transport. Living and working in the city of 2025 will feel totally different, and not just because there is no driver turning the wheel. It will be a totally foreign landscape, with little parking, no congestion, and much more space at street level dedicated to people, and with significantly fewer cars in view at any time. Driverless won’t mean carless, but cars will no longer dominate our cities as they do today. And I can’t wait.