KEY POINTS

  • Automakers, shared mobility services, and tech companies are investing in and partnering with each other to build driverless taxi services. These services would pick up passengers much as Uber or other ride-sharing services do today — minus the driver.
  • The successful deployment of driverless taxi services would significantly benefit the companies and investors collaborating to create them — as well as the communities they serve. These potential benefits include higher profits for automakers and tech companies, reduced traffic congestion, lowered pollution levels, and safer roads. 
  • BI Intelligence expects the first mass driverless taxi service (350 or more driverless taxis operating) will be deployed by 2020. While there have been many pilots for user-operated fully autonomous taxis — in which a driver is still monitoring the car from behind the wheel — the first truly driverless driverless deployment likely won't happen for a few years, due largely to regulatory hurdles.
  • Singapore is the best bet for the first driverless taxi deployment. The country recently claimed the top spot in the Networked Readiness Index (NRI), and Singapore's citizens are highly willing to ride in and pay for driverless vehicles. 
  • But it will take 20-plus years for a driverless taxi service to make a significant dent in the way global consumers travel. For larger countries like the US — which spans 3.8 million square miles, compared with Singapore's 277 — it will be much more difficult to deploy a nationwide driverless taxi service that serves all consumers. Countries will need to revamp infrastructure to allow for driverless taxis, and that could take decades.
  • Driverless taxis will face three key challenges: regulation, improving autonomous technology, and consumer willingness to ride. For now, automakers and tech companies will focus on improving driverless technology and pushing regulators to allow it. Eventually, though, they will need to launch consumer outreach and ad campaigns that show the benefits of fully autonomous cars to persuade consumers to ride in them. 

Introduction

The rise of shared mobility services, coupled with advancing autonomous technology, is creating a future in which consumers may order a driverless taxi to take them where they need to go. These services would mirror how an Uber works today, but there wouldn’t be a driver.

The potential benefits of a driverless taxi system include higher profits for automakers and tech companies, reduced traffic congestion, lowered pollution levels, and [...]