The age of driverless cars is almost upon us.

The high tech vision of the future popularized in movies like I, Robot and Minority Report is finally coming to fruition, with almost every major car manufacturer and several tech companies all vying to be the first to market with a truly autonomous vehicle.

The promises of self-driving cars are seemingly endless: fewer accidents, less congestion, and being able to relax during long drives.

But how will this paradigm shift affect car ownership?

Will everyone go out and purchase a brand new robot chauffeur or will owning a car become obsolete?

Let’s take a look at where the future of car ownership is heading.

Car ownership is dead

For the past century it has been a goal in many people’s lives to save up enough money to buy their first car. It became a part of the American Dream and by proxy a symbol of success and status.

As cars became mass produced and cheaper, this opened up the possibility of owning a car to millions of more people, and the number of cars on the road has exploded to over a billion on the roads across the globe.

However, due to dwindling supplies and increasing environmental pressure, the cost of gas to power all of these vehicles has been steadily climbing for decades with the average price now 10 times higher than it was in 1970.

As public transit systems increased in scope and density across the world, learning to drive has fallen out of favour with many younger generations. Coupled with the significantly lower cost of getting around via transit compared to buying, insuring and refueling your own car, it would seem owning your first car isn’t the symbol of freedom and success it once was.

Rideshare on the rise

Smartphone screen showing uber app

The final nail in the coffin for traditional car ownership is undoubtedly the rise of the internet and rideshare platforms.

With a simple tap on your smartphone, companies like Uber and Lyft will have a driver sent straight to your door who will take you to your destination and then drive off without you having to deal with parking, insurance or any other hassle associated with owning a car

Whilst the taxi industry has been around for centuries, all of a sudden it has become possible to order a car without speaking to anyone, from anywhere in the world, and be able to accurately track when your car would arrive and how much it would cost.

The numbers speak for themselves: from a ridership of less than 5% in 2014, the ridesharing industry is now worth $655 million in Canada and is projected reach a billion dollars by 2022.

Many people, particularly Millennials and Zennials, have shifted to “gig” style employment to meet gaps in job markets, and for the flexibility offered by these kids of jobs.

They are increasingly seeing investing a large amount of money in purchasing their own car as a waste of capital, as the car is a depreciating asset that is typically only used 2 hours per day. This money could be better spent on travel, experiences or saving towards owning their own home.

Why spend tens of thousands of dollars on owning your own car that will sit idle for most of its life, when you could spend just $10 getting from point A to point B when you actually need it and then not have to worry about vehicle insurance or upkeep?

The roads of the future

It’s hard not to see the incredible benefits offered by a shift to an entirely autonomous vehicle network.

When you remove the possibility of human error, the number of auto accidents will decline dramatically, potentially saving over 1,800 lives every year in Canada alone.

Drinking and driving will become a thing of the past, as no one would actually have to get behind the wheel of a car anymore and can be driven home by their very own chauffeur whenever they need it.

Fewer accidents also means lower vehicle insurance premiums, with some even going so far as to suggest that the entire car insurance industry will have to pivot to stay alive.

Close up of autonomous robot figure

Warren Buffett, famous investor and owner of GEICO car insurance, has said that as accidents become more and more uncommon, car insurance companies will have to either evolve or die: “Anything that cuts accidents by 30%, 40%, 50% would be wonderful, but we won’t be holding a party at our insurance company.”

Many futurists have theorized that current car insurance companies will change from covering drivers to covering car manufacturers and software developers who create autonomous vehicles.

This means that the average driver will be saving thousands of dollars a year on auto insurance, which could be better spent on health insurance or other important expenses.

Space race

If no one owns their own car and everyone uses a shared car network, then the need for on-street parking practically evaporates.

One study has suggested that switching over to a completely autonomous rideshare model in Lisbon, Portugal, could result in the reclamation of 20% of the curb-to-curb street space, equivalent to 210 soccer fields.

This could lead to wider pedestrian pathways, more bike lanes, or other exciting uses of the extra space we haven’t even thought of yet.

Whilst it is likely that the total amount of car usage would actually increase in this switch to full automation due to the need to reposition between rides, the amount of congestion would also plummet.

This is because it is likely that all autonomous vehicles would end up sharing traffic information with one another, and if the entire network knows what is happening at once, they can optimise their speeds and routes to practically eliminate traffic jams.

Imagine a New York City without the honking horns, endless bumper-to-bumper traffic and getting from one end of Manhattan to the other without cursing the driver in front of you? That’s a future autonomous vehicles could deliver.

Tackling climate change 

No longer owning your own vehicle would not only save you space, time and money, it would also be a fantastic move in the fight against climate change.

As fossil fuel reserves dwindle and battery technology becomes ever more advanced, electric cars look set to completely take over the auto industry by the middle of the century.

Electric cars offer instant torque, are whisper quiet, and run on electricity which is becoming increasingly eco-friendly all over the world.

This means that a fleet of autonomous vehicles would cut not only noise pollution dramatically, but also greenhouse gas emissions and would go a long way to helping the world meet its obligations to the Paris Agreement.

Whilst it will become prohibitively expensive to own a traditional gas-guzzler in the future, car lovers will likely still be able to actually purchase their own autonomous vehicle if they don’t want to share with everyone else.

Or will they?

Whose car is it anyway?

Google autonomous Lexus car

Automakers are already gearing up to put the question of who owns their cars to bed.

Many car manufacturers are arguing that as they own and manage the software that will be used to power these vehicles, they own the cars and that anyone using them is simply leasing them from the company.

This might seem like a corporate overreach, but it does actually make sense. As fault is likely to fall to the manufacturer and software developer in the event of a car accident in the all autonomous future, it would be in the automakers would want complete ownership of their vehicles so they can install the latest software and actively respond to any mechanical failure before it results in an accident.

The U.S. Copyright Office is currently holding hearings into this very topic to determine where ownership rights lie when it comes to autonomous vehicles.

If they side with the auto industry, it looks like you might not even be able to outright own your own car even if you wanted to.

Your car is still yours … for now

Whilst an autonomous future is all but inevitable at this stage, it is still a while away from significantly impacting our daily lives.

Most predictions put the real rise of driverless vehicles to begin in 2025, and they will likely only surpass traditional vehicle sales by 2040.

Until that point, its business as usual when it comes to owning a car.

Are you looking for a car loan but your credit score isn’t where it should be?  Contact Autoloans.ca to get yourself into your new car today.

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