The Future of the Forecourt: A Vision for 2040

By 
Jackson Lewis, Associate Editor

CHICAGO -- Today, 3 million electric vehicles (EVs) glide along the globe. In a little more than 20 years, that number could swell to more than 320 million, according to a recent forecast from BP.

Even so, EVs would still represent only about 15% of vehicles on the road. In the short term, gas is going nowhere.

Autonomous vehicles (AVs) will also see increased numbers but at a slower pace. More than 33 million AVs will be sold globally in 2040, according to researcher IHS Markit.

Today’s roads are an oligarchy where gasoline-powered, human-driven cars are the only true players in personal transportation. But tomorrow’s roads could be a vehicular democracy, with a mix of autonomous, electric, hydrogen, ethanol and gasoline. And three big forces will drive the most amount of change: regulators, private businesses and public transportation.

Consider this: The global car market is worth about $2 trillion per year, while the global personal transportation market is worth as much as $10 trillion, according to Morgan Stanley. AVs have the potential to blur the lines between these markets and improve others—regulation permitting. It’s even disrupting the disruptors. Sebastian Thrun, an AV researcher at Stanford who led efforts to develop Google’s first self-driving car, recently told The Economist that automation, competition and electrification will cut the costs of ride-hailing by 70%.

But these changes will not reach every market equally or simultaneously. Like real estate, the types of vehicles on the road will depend on one thing: location, location, location.

Illustrations by Gary Musgrave

Scenario 1: Urban Markets

Commercial self-driving cars will permeate urban ride-sharing services and public transportation, with fueling up in the air

When it comes to AVs, cities already have a head start. “So much of the development [of AVs] has really been focused on urban centers, and I would expect that to reflect where the technology will be deployed initially as well,” says Jeremy Carlson, principal automotive analyst for Southfield, Mich.-based IHS Markit.

“In the United States, we would expect [AVs] to more closely resemble a ride-hailing business model, like an Uber or a Lyft, centered around a dense urban area where there’s going to be ... pretty high and pretty consistent demand for it,” says Carlson. He also anticipates every market will be different, and that markets with strong existing public transportation (Europe, for example) would likely see more mass-transit vehicles slowly transition from human to computer control.

Deploying a fleet of potentially thousands of self-driving vehicles through a city brings up the next logical question: Where would all of these vehicles go to recharge or refuel?

“I’ll be honest: No one has figured that out,” says Carlson. His best guess is that the AV service provider would build their own service centers for their vehicles, but he admits this would be a huge investment. And that’s not factoring in the cost of the vehicles, something today’s ride-hailing services such as Uber and Lyft do not have to contend with, because the companies don’t own the vehicles their contractors drive.

On the fuel side, electric-powered public transportation is already growing in urban areas today. In Chicago, for example, employees who work in the Prudential Plaza and Aon Center offices have had access to all-electric buses traveling between a train station and the business park every weekday since late 2016.

On the streets of San Francisco and Los Angeles, General Motors has hundreds of all-electric Chevy Bolts as part of a car-sharing network for rideshare drivers, known as Maven Gig. Waymo, Google’s AV car division, has more than 5 million self-driven miles behind it. And last year, Waymo’s cars began test-driving on public roads without anyone in the driver’s seat.

As autonomous transportation grows in cities, Carlson says, the services will eventually extend to the suburbs. It’s beyond the suburbs, in rural markets, where the outlook starts to change.

Scenario 2: Rural Markets

Petroleum and other liquid fuels will hold out longer in rural communities, where lengthy rides and larger cargo are more the norm

It’s been more than two years since Jay Ricker, chairman of Ricker Oil Co., Anderson, Ind., installed EV charging stations at nine Ricker’s c-stores. “And out of those nine locations, they average, in total, two charges a day,” he says.

Those stations are in Indianapolis, a city with high population density chosen specifically by Nissan because of the number of EV owners in the area. Just imagine how rare the stations would be used in Ricker’s more rural markets.

Ricker envisions rural drivers owning vehicles with a variety of different fuel types in the future. Yes, he says, there will be more EVs on rural roads as time passes, but even after EVs conquer range anxiety and charging times that take 30 minutes or more, it will still be many decades before enough of those vehicles are manufactured to rival the number of petroleum-based cars on the road.

He also believes that the pull of farmers on Capitol Hill is “so doggone strong in this country, you’re not going to see ethanol go away.” Ultimately, fuels used in rural communities tomorrow will likely resemble cities today: a hodgepodge of different fuel options depending on what is available for purchase in a particular market.

Carlson of IHS Markit contends that there may still be a place for self-driving vehicles in rural markets, though the cars would likely be owned by individuals or companies instead of parts of public transportation fleets. “There are still some obstacles there, but that doesn’t mean that we won’t start to see more specialization around automation,” says Carlson. While not meant for personal transportation, AVs already exist as mining and farming tools. So seeing mass-produced, individually owned AVs on the road, powered by conventional petroleum fuels or ethanol blends, is not outside the realm of possibility.

While it’s certainly possible that self-driving technology could eventually change the way consumers think about owning cars, Carlson and the IHS team do not predict the death of vehicle ownership as EVs and AVs become more common, and that certainly applies to rural markets.

Scenario 3: California and other outliers

In certain markets, emissions goals and other policies already set by state and local governments will propel change at a faster rate

There will be exceptions to the urban-rural divide. Ricker believes that California will see more hydrogen-powered cars than most U.S. markets, given the large investment the state has already made in the alternative fuel.

The California Energy Commission says hydrogen fueling is critical to meeting the state’s goal to see 5 million zero-emission vehicles on California roads by 2030. This executive order made by Gov. Jerry Brown also calls for 250,000 EV charging stations and 200 hydrogen fueling stations by 2025. This mandate reflects similar goals to lower vehicle emissions in countries overseas, including France and China.

There are also many use cases for AVs to consider beyond transporting people. Tesla’s recent release of completely electric semitrailers, along with more nascent concepts such as Santa Clara, Calif.-based Robomart, points to an interest in AVs as delivery vehicles.

U.S. carmaker Ford is especially bullish on autonomous delivery. Ford is working with Domino’s Pizza to study the efficacy of self-driving cars delivering food. The two companies started an initial test last year in Ann Arbor, Mich., which recently extended to Florida’s Miami-Dade County. Soon Postmates will also be a part of the test. These tests are primarily meant to study how people interact with self-driving cars instead of the cars themselves. Ford is already past wondering whether AVs will dot the roads of the future; it has moved on to exploring real-world applications of the technology.

Fear of self-driving vehicles will also be a factor in how quickly AVs gain more share of the road. One recent study from AAA shows that 63% of U.S. drivers report feeling afraid to ride in a fully self-driving vehicle. While that number decreased 15 percentage points from the year prior, it still indicates an unwillingness by the majority of the country’s population to be driven in autonomous vehicles.

“I take these surveys with a grain of salt,” says Carlson. “It’s a technology [survey responders] haven’t seen and haven’t interacted with. Therefore, asking them if they understand it, much less if they’re comfortable with it, I think, is a double stretch.”

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