Transportation and geography have always been intertwined. Specifically, the auto industry, with Detroit being the prime example, was once more tightly tied to place. The same can be said for the tech industry, which still maintains a dominance largely in Silicon Valley. Until very recently, these industries were distinct: tech was tech and transportation was transportation and never the twain shall meet.
A number of disruptions have shaken this stability, but ridesharing companies Lyft and Uber, as well as the entrance of technology companies like Google into the autonomous driving space, have driven right through it. Over the course of five years, ridesharing services have expanded rapidly, moving these services from the periphery of transportation options to a mainstream means of getting around.
In fact, cities are beginning to regard transportation network companies (TNCs) as significant parts of their transportation networks, and the distance between Detroit and Silicon Valley is rapidly decreasing — so much so that auto behemoth General Motors has struck a deal with Lyft, ridesharing’s nice guy.
GM and Lyft are planning to work together to develop a new network of self driving cars, and additionally, GM invested $500 million to Lyft’s latest fundraising round. This type of unprecedented investment aligns the auto and tech industries’ interests and has enormous potential to drive TNCs even further into the mainstream and continue to normalize the use of ridesharing services in American cities.
Automakers are astutely aware of the changes taking place in the transportation sector.
It wasn’t until the onslaught of TNCs, Tesla, and self-driving automobile technologies that the West coast even dabbled in the driving business. This is only the beginning of the burgeoning relationship between the Midwest and Silicon Valley, as there are also reports of a developing partnership between Ford and Google.
This melding of technology and transportation is furthered by other collaborations. While Google Ventures was one of the early major investors in Uber, the two companies now seem to have split. Uber moved on fast, though, by teaming up with Carnegie Mellon, and also sending the university’s robotics laboratory into a tailspin by poaching several of its top scientists.
As you can imagine, this new partnership between Uber and CMU is also interested in dominating the driverless car realm, creating ever-growing competition with the newly established (potential) Ford/Google and (existing) GM/Lyft clans.
With all of these major automakers considering partnerships with tech companies, we can only imagine the possibilities. Automakers provide the physical stock, essentially managing the complex and expensive production part of the business. Technology companies and/or TNCs provide the technology and logistics to deploy those vehicles to the American public in a way that makes using them incredibly easy. One system feeds the other, which produces demand for the former. This has the possibility of being as revolutionary to transportation habits as the assembly line was at the beginning of the 20th century.
Most surprising is the acknowledgement by the auto industry, which has been locked into the security of Americans’ love for the single occupancy vehicle for a century that transportation is changing. Automakers are astutely aware of the changes taking place in the transportation sector. They are now using them as a leverage point to reclaim their industry and taking on the role of mobility companies rather than automotive companies.
The potential implications for urban transportation are enormous. Autonomous vehicles present a transportation model that is very different from what we are used to. There is still a great deal of uncertainty about how all of this will play out for American cities.
The partnerships and decisions made among big auto and big tech now have the potential to definitively impact the future of cities.
Depending on whether we largely see a model of shared or personally owned driverless cars, the future of cities could look very different. Shared autonomous vehicles will make roads less congested, in part due to their more efficient movement around a city and the fact that don’t rely on parking space during idle times.
The reduction of parking space alone could free up a vast amount of land currently devoted to parking for redevelopment into more productive uses. Removing parking and redeveloping cities in a way that enables higher density is only one potential path cities could take.
By traveling more closely together and improving the flow of traffic, driverless technology may also enable commuters to cover greater distances with greater comfort and reliability. Instead of continuing to flock to cities, many Americans may move even further into the suburban and exurban communities for cheaper homes. In the end, these two options are not mutually exclusive. Both will likely occur in metropolitan areas throughout the country depending on policy choices made.
Leadership will matter in this coming shift. While much of this may be speculative today, the partnerships and decisions made among big auto and big tech now have the potential to definitively impact the future of cities. Transportation is changing. The auto industry is officially along for the ride, and at least for the near future, how mobility rolls forward can be found somewhere between Detroit and Silicon Valley.