Driverless cars and limited ownership: the future of a digitised motor industry?

A generation ago driverless cars were the stuff of science fiction, but in a relatively short period of time people have grown used to the idea and begun to see them as part of the near future.

In fact, the car industry is looking at a date around 2035 by which time it expects driverless cars to become more commonly available.
Google started testing self-drive technology in 2009. Since then its cars have driven more than 1.5m miles and it now has a fleet of modified SUVs and new prototype vehicles on the roads of small towns across the United States.

Over roughly the same period, the Uber app has become the established way to find and book a taxi ride online. Using technology that tells drivers where to pick up and to drop off, the app then performs a cashless payment once the journey is completed. Uber has facilitated more than a billion connections between passengers and drivers.

Imagine, in the near future, being able to use an Uber-style service to call-up a driverless car for your journey? Not only would this be revolutionary for public, with a more limited need for car ownership, but it could have huge ramifications for the automobile industry. Against that backdrop, how does the car industry stay relevant and useful in the way it has done for the last 100 years?

Of course, cars will still need to be manufactured, but perhaps fewer of them, but the biggest change for the car industry could come in its relationship with customers.

It might not be the case that all customers will even own or lease a car from a manufacturer – there could be multiple customer types.

In bigger cities, customers might rely on the car company to serve them driverless cars on an ad-hoc basis. Cars could be called-up through an Uber-like app and charges could be leveed either on direct usage or based on use in the previous quarter.

Other customers might choose to own or subscribe to have a self-drive car on a permanent basis, but then pay an additional fee for a driverless car on a city visit or to upgrade to a larger self-drive model for holidays.

In many respects, a car brand could become like a utility-like service to meet the mixed transportation needs of its customers – but for such a service to fully meet the needs of an expectant public, the technology used to connect with the customer needs to work seamlessly.

That could mean light touch identification measures and robust fraud prevention, all of which takes place without endless box-ticking and with just a single verification process that stores user information, and a customer experience that makes it as easy to buy a new car and get it on the drive as it does to call up a driverless taxi ride.

The challenge for the automobile industry could be on two fronts – developing the next generation of vehicles and turning itself into a customer-centric digital service sector.