Rethinking Transportation

isotopp image Kristian Köhntopp -
May 23, 2017
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Tony Seba (Stanford University) came up with a kind of best-case scenario for electrification and decarbonization. “Rethinking Transportation 2020-2030 ” sees a self-amplifiying change in how we travel and transport things:

By 2030, within 10 years of regulatory approval of autonomous vehicles (AVs), 95% of U.S. passenger miles traveled will be served by on-demand autonomous electric vehicles owned by fleets, not individuals, in a new business model we call “transportas-a-service” (TaaS). The TaaS disruption will have enormous implications across the transportation and oil industries, decimating entire portions of their value chains, causing oil demand and prices to plummet, and destroying trillions of dollars in investor value — but also creating trillions of dollars in new business opportunities, consumer surplus and GDP growth.

Rethinking Transportation

It won’t quite happen this way, especially when it comes to TaaS, because the economic basis for that won’t exist easily, but very likely the switch will happen faster than expected.

Transport-as-a-service means that an institutional owner for transportation must exist. That owner must have a way to get rid of used vehicles. At the moment, car rental agencies sell off rental cars after a rather short time period into private ownership. That is also why rental cars do not look more like rental cars, despite a number of obvious improvements coming to mind.

In a TaaS-heavy society, demand for private car ownerhip may be so low that the institutional owner for cars does not have an easy way to get rid of these vehicles. If and how much of that pressure exists is unclear at the moment.