Self-driving revolution to create $7trn industry

‘Passenger economy’ will enable everything from onboard salons to mobile kiosks by 2050, says Intel

SELF-DRIVING cars will become a $7trillion-a-year industry by 2050 by revolutionising the way we travel, work and live, Intel has predicted.

The US tech giant is forecasting what it terms a “passenger economy” that will create huge opportunities for new businesses as people transform from drivers into riders with time – rather than a steering wheel – on their hands.

Some of the more outlandish predictions from the Intel research include what it calls “car-venience” applications such as onboard beauty salons in vehicles, as well as mobile health clinics and treatment pods. It even imagines that self-driving vehicles could “platoon” together to form pod hotels.

“Companies should start thinking about their autonomous strategy now,” said Brian Krzanich, Intel chief executive. “Less than a decade ago, no one was talking about the potential of a soon-to-emerge app or sharing economy because no one saw it coming.

“This is why we started the conversation around the passenger economy early, to wake people up to the opportunity streams that will emerge when cars become the most powerful mobile data-generating devices we use and people swap driving for riding.”

He warned that companies that do not prepare for this “explosive” change face failure and even extinction, drawing parallels with the disruption caused by the rise of mobile phones, which has “reconfigured entire industries”.

Mr Krzanich also predicted an “unlocking of cognitive surplus” with selfdriving cars expected to free up millions of hours per year of commuters’ time in the world’s most congested cities. The research predicts this new economic sector will be worth $800bn a year by 2035, rising to $7 trillion (£5.4 trillion) 15 years later.

Of this amount, 98pc is expected to come from “mobility as a service”, broadly split between consumers abandoning traditional car ownership models and summoning driverless vehicles as and when needed, and businesses using self-driving vehicles for transportation and freight delivery.

The remainder – some $200bn – will be generated by new and emerging applications in sectors such as hotels and hospitality, tourism, entertainment and healthcare. Passengers could also use their time to watch movies, play games or shop, further driving spending in the economy.

The research, carried out for Intel by Strategy Analytics, also forecasts the creation of entirely new types of service. These could include companies “going mobile” with suggestions that fast-food restaurants or coffee shops could create “driverless kiosks” that go to their customers.

Fleet management companies are also set to enjoy a boom as traditional car ownership dies out, and “recharging farms” will emerge to service electric vehicle fleets.

“It is easy to envision an electric Uber delivering people and goods on a nearly around-the-clock-schedule as needed,” said the report. “It is also realistic to expect that trucks transporting goods between distribution centres and retail outlets will be able to run on an almost 24 hours a day, seven days a week schedule.”