About a week ago I wrote a post questioning what driverless cars will mean for cities. I ended by saying that that it feels as if we’re going to see increasing tension between private and public transport.
What I meant by that was simply that conventional notions around private car use are going to change. And ultimately that is going to mean that we need to rethink public transport and how that fits into a broader urban mobility framework.
What do I mean by this?
The International Transport Forum at the OECD recently published a fascinating report called, Urban Mobility System Upgrade: How shared self-driving cars could change city traffic. And it deals with exactly the sorts of things I am thinking about.
The study looked of what might happen when all cars become self-driving in a mid-sized European city (specifically Lisbon, Portugal). They leveraged existing transportation data from the city, but replaced 100% of the human powered cars with two types of self-driving cars: TaxiBots and AutoVots.
TaxiBots were driverless cars that would be shared with multiple people at the same time. In other words, they were a kind of pseudo-public transit. And AutoVots we’re your more conventional private taxi. They picked up one person at a time.
In the first scenario, they combined their TaxiBots and AutoVots with public transit (light rail) and discovered that the same number of people could be moved around with only 10% of the cars currently on the road. That’s a 90% reduction!
They also found that the city needed 20% less on-street parking and 80% less off-street parking since driverless cars don’t need to sit idle waiting for a driver.
In the second scenario, they removed mass transit from the equation. And in this instance they found that the city was still able to get around, but with an 80% reduction in the number of cars on the road. Remarkably, it also led to a 10% reduction in rush hour commute times.
These are pretty profound changes. Reducing the number of cars on the road by 80-90% is a significant change.
But it’s also why I’ve been thinking about the tension between private and public transport. As we get better at optimizing “cars” (their definition will change), what becomes the role of true public transit?
Ultimately, I think what will happen is a blurring of the two. In the example above, the TaxiBots served basically as small scale public transit. But that does not necessarily mean that true mass transit will become irrelevant. We’re just going to need to rethink how the entire mobility network fits together.
I’d now like to bring this discussion back to Toronto for a minute.
As many of you probably know from this blog, Toronto is on the cusp of deciding what to do with the eastern portion of the Gardiner Expressway (an elevated highway that runs across the downtown waterfront). It will go to City Council next month.
I firmly believe that we should remove it, but there many people who believe we shouldn’t. The main objection seems to be that the traffic projections indicate that removing it could make commuting into downtown – by car – 3 to 5 minutes longer by 2031.
By today’s standards, I believe this concern represents an outdated way of thinking about cities and urban mobility. Adding more lanes is like loosening your belt to deal with obesity. However, it gets even worse when you think about urban mobility in the context of this post.
Given the profound transportation changes that are currently underway, I think there’s a strong likelihood that the Gardiner projections we have today will be completely wrong by 2031. I don’t know know for sure, but I’m guessing the models don’t account for the efficiencies being created by driverless cars and peer-to-peer networks.
In other words, I am suggesting that those 3 to 5 minutes could prove to be a red herring. The relevant question should be: Which decision will allow Toronto to build the absolute best waterfront in the world? And in my opinion that leads to removing the Gardiner East.
If you feel similarly, I would encourage you to write your local City Councillor.
A few days ago, Bill Gurley – who is an investor in Uber – wrote a really fascinating blog post called, Uber’s New BHAG (Big Hairy Audacious Goal): UberPool. Bill doesn’t update his blog very often, but when he does it’s incredible stuff.
I’ve touched on UberPool briefly before. But basically it’s a true “ride sharing” service where people with overlapping routes can easily share the same car – much like people do today informally. The obvious advantage of this is cost. It’s cheaper to share.
What’s most fascinating about this service though is how it fits into Uber’s larger mission to drive transportation costs down. And there’s a specific reason for that (via Bill Gurley):
When Uber launched its low-cost UberX offering in the summer of 2012, the company quickly realized that the demand for its transportation services is HIGHLY elastic. As the company achieved lower and lower per-ride price points, the demand for rides increased dramatically. A lower price point delivered a much better value proposition to the consumer, yet still remained a great business decision due to the remarkable increase in demand.
So what Uber quickly figured out was that if they could increase the utilization rate for drivers (the time actually spent with passengers), they could charge consumers lower prices while at the same time maintaining driver salaries. Prices went down, but volume went up.
One way to do that is to obviously decrease driver downtime by improving liquidity on the marketplace. But another way is to simply increase the number of passengers being transported at one time. Hence the creation of UberPool.
But it doesn’t stop there.
Because of all the transportation data that Uber now has (the company has a data group called the “math department”), they can fairly accurately predict what a price cut will do to their ridership levels. This allows them to “forward invest” their capital in new services – such as UberPool – before they even have the revenue from the anticipated increase in ridership.
So what does this all mean?
It means that Uber is going to get cheaper and cheaper and cheaper. Uber is trying to get to what they call “The Perpetual Ride”, which basically means that drivers will always have customers (100% utilization). That’s quite a goal, but it would mean the absolute lowest prices for consumers (barring any other changes to their cost structure).
Dirt cheap transportation is a pretty compelling value proposition, which is why I continue to believe that cities should be hard at work trying to figure out how to harness this transportation shift.
If you’re interested in this topic, I would encourage you to give Bill Gurley’s blog post a read.
Last night my father and I were walking to dinner and he commented to me that he thinks my generation will be a lot healthier than his–at least on average–given how much more my generation walks. I responded by reaffirming to him how little I drive these days and how much I enjoy that.
Then today, I was watching this short clip of the The High Road with celebrity chef Mario Batali, where he interviews venture capitalist Fred Wilson. During their tour around New York City, Mario asks Fred what he thinks the future of transportation will be. Fred responds by saying that nobody will drive anymore. He then went on to say that the technology for driverless cars is already ready, but that we as a society just aren’t ready for it, yet.
Finally, on my way home from wakeboarding today, I stumbled upon this Guardian Cities article talking about Helsinki’s ambitious plan to make owning a car pointless. By 2025, the goal is have a “point-to-point mobility on-demand system” that will integrate all forms of mobility into one booking and payment platform. Think everything from public transit to carpools to taxis.
As I read on, I then discovered that Helsinki is already offering on-demand public minibuses that allow people to specify their own routes on their smartphone. The system then aggregates all of the requests and establishes the most efficient route based on the immediate demand. Coincidentally enough, it’s quite similar to a use case I wrote about for driverless cars.
All of this got me thinking that one day we’ll probably look back at that time when people used to drive their own vehicles around as some antiquated and hilarious moment from the past.
Image: Observatoire
About a week ago I wrote a post questioning what driverless cars will mean for cities. I ended by saying that that it feels as if we’re going to see increasing tension between private and public transport.
What I meant by that was simply that conventional notions around private car use are going to change. And ultimately that is going to mean that we need to rethink public transport and how that fits into a broader urban mobility framework.
What do I mean by this?
The International Transport Forum at the OECD recently published a fascinating report called, Urban Mobility System Upgrade: How shared self-driving cars could change city traffic. And it deals with exactly the sorts of things I am thinking about.
The study looked of what might happen when all cars become self-driving in a mid-sized European city (specifically Lisbon, Portugal). They leveraged existing transportation data from the city, but replaced 100% of the human powered cars with two types of self-driving cars: TaxiBots and AutoVots.
TaxiBots were driverless cars that would be shared with multiple people at the same time. In other words, they were a kind of pseudo-public transit. And AutoVots we’re your more conventional private taxi. They picked up one person at a time.
In the first scenario, they combined their TaxiBots and AutoVots with public transit (light rail) and discovered that the same number of people could be moved around with only 10% of the cars currently on the road. That’s a 90% reduction!
They also found that the city needed 20% less on-street parking and 80% less off-street parking since driverless cars don’t need to sit idle waiting for a driver.
In the second scenario, they removed mass transit from the equation. And in this instance they found that the city was still able to get around, but with an 80% reduction in the number of cars on the road. Remarkably, it also led to a 10% reduction in rush hour commute times.
These are pretty profound changes. Reducing the number of cars on the road by 80-90% is a significant change.
But it’s also why I’ve been thinking about the tension between private and public transport. As we get better at optimizing “cars” (their definition will change), what becomes the role of true public transit?
Ultimately, I think what will happen is a blurring of the two. In the example above, the TaxiBots served basically as small scale public transit. But that does not necessarily mean that true mass transit will become irrelevant. We’re just going to need to rethink how the entire mobility network fits together.
I’d now like to bring this discussion back to Toronto for a minute.
As many of you probably know from this blog, Toronto is on the cusp of deciding what to do with the eastern portion of the Gardiner Expressway (an elevated highway that runs across the downtown waterfront). It will go to City Council next month.
I firmly believe that we should remove it, but there many people who believe we shouldn’t. The main objection seems to be that the traffic projections indicate that removing it could make commuting into downtown – by car – 3 to 5 minutes longer by 2031.
By today’s standards, I believe this concern represents an outdated way of thinking about cities and urban mobility. Adding more lanes is like loosening your belt to deal with obesity. However, it gets even worse when you think about urban mobility in the context of this post.
Given the profound transportation changes that are currently underway, I think there’s a strong likelihood that the Gardiner projections we have today will be completely wrong by 2031. I don’t know know for sure, but I’m guessing the models don’t account for the efficiencies being created by driverless cars and peer-to-peer networks.
In other words, I am suggesting that those 3 to 5 minutes could prove to be a red herring. The relevant question should be: Which decision will allow Toronto to build the absolute best waterfront in the world? And in my opinion that leads to removing the Gardiner East.
If you feel similarly, I would encourage you to write your local City Councillor.
A few days ago, Bill Gurley – who is an investor in Uber – wrote a really fascinating blog post called, Uber’s New BHAG (Big Hairy Audacious Goal): UberPool. Bill doesn’t update his blog very often, but when he does it’s incredible stuff.
I’ve touched on UberPool briefly before. But basically it’s a true “ride sharing” service where people with overlapping routes can easily share the same car – much like people do today informally. The obvious advantage of this is cost. It’s cheaper to share.
What’s most fascinating about this service though is how it fits into Uber’s larger mission to drive transportation costs down. And there’s a specific reason for that (via Bill Gurley):
When Uber launched its low-cost UberX offering in the summer of 2012, the company quickly realized that the demand for its transportation services is HIGHLY elastic. As the company achieved lower and lower per-ride price points, the demand for rides increased dramatically. A lower price point delivered a much better value proposition to the consumer, yet still remained a great business decision due to the remarkable increase in demand.
So what Uber quickly figured out was that if they could increase the utilization rate for drivers (the time actually spent with passengers), they could charge consumers lower prices while at the same time maintaining driver salaries. Prices went down, but volume went up.
One way to do that is to obviously decrease driver downtime by improving liquidity on the marketplace. But another way is to simply increase the number of passengers being transported at one time. Hence the creation of UberPool.
But it doesn’t stop there.
Because of all the transportation data that Uber now has (the company has a data group called the “math department”), they can fairly accurately predict what a price cut will do to their ridership levels. This allows them to “forward invest” their capital in new services – such as UberPool – before they even have the revenue from the anticipated increase in ridership.
So what does this all mean?
It means that Uber is going to get cheaper and cheaper and cheaper. Uber is trying to get to what they call “The Perpetual Ride”, which basically means that drivers will always have customers (100% utilization). That’s quite a goal, but it would mean the absolute lowest prices for consumers (barring any other changes to their cost structure).
Dirt cheap transportation is a pretty compelling value proposition, which is why I continue to believe that cities should be hard at work trying to figure out how to harness this transportation shift.
If you’re interested in this topic, I would encourage you to give Bill Gurley’s blog post a read.
Last night my father and I were walking to dinner and he commented to me that he thinks my generation will be a lot healthier than his–at least on average–given how much more my generation walks. I responded by reaffirming to him how little I drive these days and how much I enjoy that.
Then today, I was watching this short clip of the The High Road with celebrity chef Mario Batali, where he interviews venture capitalist Fred Wilson. During their tour around New York City, Mario asks Fred what he thinks the future of transportation will be. Fred responds by saying that nobody will drive anymore. He then went on to say that the technology for driverless cars is already ready, but that we as a society just aren’t ready for it, yet.
Finally, on my way home from wakeboarding today, I stumbled upon this Guardian Cities article talking about Helsinki’s ambitious plan to make owning a car pointless. By 2025, the goal is have a “point-to-point mobility on-demand system” that will integrate all forms of mobility into one booking and payment platform. Think everything from public transit to carpools to taxis.
As I read on, I then discovered that Helsinki is already offering on-demand public minibuses that allow people to specify their own routes on their smartphone. The system then aggregates all of the requests and establishes the most efficient route based on the immediate demand. Coincidentally enough, it’s quite similar to a use case I wrote about for driverless cars.
All of this got me thinking that one day we’ll probably look back at that time when people used to drive their own vehicles around as some antiquated and hilarious moment from the past.
Image: Observatoire
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