How free self-driving car rides could change everything

It's Saturday night, and you're planning an evening out. You fire up a ridesharing app to head out to your favorite restaurant.

But then an ad appears, offering a free ride to a new Thai spot on the other side of town.

Suddenly, you're reconsidering plans: Why pay for a ride to one neighborhood when another is totally free? Ultimately, your favorite restaurant could lose a customer.

Scenarios like this may play out in the coming era of self-driving vehicles. The cost of offering fully autonomous rides could be so low that businesses will be tempted to subsidize the rides to boost their bottom line.

According to experts, the move could have big implications not only for businessesbut for cities, public transportation systems and car owners.

"There's an infinite number of new advertising modes that become possible," said Hod Lipson, a Columbia University engineering professor and author of the book "Driverless: Intelligent Cars and the Road Ahead." "We'll see a lot of innovation."

In some cases, Uber and Lyft rides are already priced so low that they're competitive with public transportation systems. With self-driving vehicles, costs will be even lower. After all, there will be no driver to pay. Ultimately, public transportation systems could be undercut.

Research from investmentfirmArk Invest has estimated autonomous taxis will cost $0.35 per mile. Rides today typically run a few dollars for each mile.

According to Ark Invest analyst Tasha Keeney, someone taking a shared ride in a self-driving vehicle could experience even cheaper rides. But some riders may not see a point in riding with strangers if it's only saving them 5% on an already low fare, Keeney added.

This could result in a traffic nightmare. Urban designer Jeff Speck warned low-occupancy vehicles are a tremendous waste of street space.Replacing trains and buses with autonomous vehicles could cripple mobility.

As a result, city planners may need to determine how to manage a major influx of self-driving vehicles. Automakers may also see a decline in sales as customers may see fewer reasons to buy a car.

28. September 2017

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