The Future of the Automobile Industry: Sell Rides, Not Cars

General Motors is the latest major car company to make a large investment in ridesharing.

Autonomous cars will change the entire business of transportation. Selling one car to every person isn't a viable business model — why own when you can just summon one when needed? The question here is whether the major car manufacturers will innovate or die. 

GM seems to have seen the shift, deciding to invest $500 million in Lyft.

Brad Templeton of Singularity University writes that he found GM's investment interesting, “because it’s another car company showing they are not just giving lip service to the idea of selling rides rather than cars.”

Below, Templeton offers a crash course in Autonomous Vehicles 101.

GM wants to partner with Lyft to create a “network of on-demand autonomous vehicles,” breaking away from the traditional model of selling cars to individuals. In their presumed future, consumers will become summoners in the age of robocars — not caretakers of their own vehicles.

This model makes sense, and the success or failure of these businesses will be decided on how quickly they can answer the call for a pickup.

The technology isn't quite there yet. GM plans on rolling out its own semi-autonomous “Super Cruise” function into its 2017 Cadillac CT6. The feature is not unlike what Tesla introduced in its cars just last year, which gave drivers the ability to take on a supervisory role while on the highway. There are still questions as to how these robocars will be received in a world of unpredictable human drivers. (Google's cars have been on the receiving end of a number of rear-endings.)

But when these cars do arrive (maybe as soon as 2030), this sharing economy will create a more efficient world. It will empower the elderly — who could not otherwise drive a car on their own.

“We're going to rewrite really important elements of our society when we make transportation one of these computerized technologies,” says Templeton. “It's going to change a lot more of our lives than people think to have cars that are smart in this way.”


Natalie has been writing professionally for about 6 years. Her work has appeared in Wall St. Cheat Sheet, Geek, GDGT, and PCMag. She focuses on researching and writing about the environment and technology, and the issue surrounding how each impacts our lives in a major way. Follow her on Twitter: @nat_schumaker

Photo Credit: Shutterstock

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