One trillion dollars of real estate is on the move and here is why
Autonomous vehicles, self-driving cars and trucks, are coming very soon. The world is going to change because of them and how it affects how we live and work. These two articles “second order effects” and “$1 trillion of real estate is on the move … here’s why” explain why and are a must read for anyone involved in private and public transport and all of us involved in real estate.
A lot has been written about the “first order” effects of autonomous vehicles (AVs): How they will reduce traffic fatalities, make rides more comfortable, or put truck drivers out of work. But the bigger story here is the “second order” effects?—? how improvements in mobility will cause us to re examine fundamental assumptions of how and where we live. The mining industry has already introduced them with Komatsu a leading supplier.
There are two foundational technology changes rolling through the car industry at the moment; electric and autonomy. Electric is happening right now, largely as a consequence of falling battery prices, while autonomy, or at least full autonomy, is a bit further off – perhaps 5-10 years, depending on how fast some pretty hard computer science problems get solved. Both of these will cycle into essentially the entire global stock of (today) around 1.1bn cars over a period of decades, subject to all sorts of variables, and both of them completely remake the car industry and its suppliers, as well as parts of the tech industry.
Let’s start with real estate. Cars (the Henry Ford kind) completely reshaped the built environment of the United States?—? giving us the suburbs, shopping malls and pulling people out of cities. What will self-driving cars do to our cities and suburbs? Surely something equally as dramatic.