Nissan announces driverless cars by 2020

[Eric L.]

Nissan announced today that they will sell driverless cars by 2020. What the heck does this have to do with real estate investing? Well, a lot. This will be the biggest driver of change since the Internet.

This will eliminate the #1 killer of Americans ages 4-34.

Very few will own cars as the nearest car will pick them up cheaply and drop them off at the door of their destination.

Goods will be shipped for almost nothing.

Cities will no longer be designed around parking lots.

Will people be more likely to move to urban areas now that parking will not be a concern?

Will suburban areas gain traction as the drive no longer has traffic?

A few things that I personally wouldn't invest in right now are car washes and self storage. Garages will now be self storage units. Also, driverless cars will deliver items ordered within the hour for urban areas. That doesn't bode well for retail locations.

What real estate investing changes do you see this bringing?

[Jon Holdman]

This is a topic of considerable interest to me. My prediction is that it will happen, it will happen quickly, and it will have radical impacts.

A key issue is liability. This technology, like others, won't be perfect. Driverless cars, aka autonomous cars, will kill people. The real question is will they improve fatality rates due to vehicles. I predict they will. However, the makers will need some liability protection or the first incidents will cripple the entire industry. I do think this will happen. There will be some backlash, but the pressure will be to give liability protection will be too strong to resist.

Automated cars will evolve somewhat slowly. That is, "regular cars" will get more and more automation. Eventually, your "regular car" will have a switch that puts it in full auto mode.

Whole job groups will just disappear - taxi drivers, delivery truck drivers, long haul semi drivers, letter carriers, train drivers, etc. Policing of traffic and related functions (tow truck drivers, courtrooms for traffic offenses) will be greatly reduced.

Over time, cars will evolve to be much different than today. If you don't have to drive and they don't crash, a car can be a lot more like an office. Or living room. Or bedroom. Or all. Or really, like small motorhomes. If you want to get from, say, Denver to Vegas, you can just summon up a "mobile motel room" to transport you there. Commuting to work becomes seamless with being at home and working. Vehicles for city use will become smaller and smaller. Like a smart car, or perhaps an enclosed version of those wacko snowmobiles turned tricycle.

Motels will be decimated. Who would bother stopping somewhere overnight when traveling if you can just stay in your mobile motel room. OTOH, something like a cross between a campground and a truck stop may evolve. You don't really have to stop for the night like now, but you still need gas, food, and such.

Like you, @Brandon Gentile I'll be loathe to give up my Mustang. But I will when my insurance rates jump by 10X or more. Or, more likely, driving will be something you do in a contained environment like a race track.

Already car purchases rates are declining. Fewer young folks see getting a car as the same rite of passage we did. As a larger percentage of the population gathers in cities (for a wide variety of reasons), readily available automated transportation will eliminate the need for owning a car. Lots of cars will cost you up toward $1000 a month between the payment, gas, insurance, and maintenance. That's $30 a day. Even if you pay cash, buy something cheap, and keep it a long time (like my 2000 Xterra), its still a significant cost. OTOH a highly efficient fleet of automated vehicles can keep busy most of the time, or be parked when they're not in use. Taxi rates should be cheaper than now.

Highway efficiency will greatly increase. Cars can communicate with each other and receive data from ground stations. Distances between vehicles can be greatly reduced in congested areas. There's no need for stoplights, the cars can sort it out for themselves, perhaps with the aid of control stations at intersections. I've already seen demos of the software that allows a never-stop intersection. The cars adjust their speeds so they can pass like jets in an airshow. If something happens, such as a breakdown, nearby cars are immediately informed and pass that on to other cars. Help can be automatically summoned and vehicles can re-route around the problem.