Tuesday, May 23, 2017

USA Africa Dialogue Series - STAR WARNING: The Disruptive Predictions for TaaS - Transportation as a Service

My People:

Please do not roll your eyes - we may be future-shocked again in oil-imbued Nigeria - nay Africa - to our detriment if we do not pay attention to the ongoing Electric Vehicle revolution, and its future economic, environmental, geopolitical and social impacts on our country, our continent and the world. Otherwise, we will be poorer for it, locking ourselves into  "expensive, obsolete, uncompetitive assets, technologies and skill sets."

By the way, there is already Uber in Nigeria!

And there you have it.

Bolaji Aluko


Rethinking Transportation 2020-2030 
The Disruption of Transportation and the Collapse of the Internal-Combustion Vehicle and Oil Industries

A RethinkX Sector Disruption Report 
May 2017 
James Arbib & Tony Seba

Executive Summary

We are on the cusp of one of the fastest, deepest, most consequential
disruptions of transportation in history. By 2030, within 10 years of
regulatory approval of autonomous vehicles (AVs), 95% of U.S. passenger
miles traveled will be served by on-demand autonomous electric vehicles
owned by fleets, not individuals, in a new business model we call "transport-as-a-service" (TaaS). The TaaS disruption will have enormous implications
across the transportation and oil industries, decimating entire portions
of their value chains, causing oil demand and prices to plummet, and
destroying trillions of dollars in investor value — but also creating trillions of
dollars in new business opportunities, consumer surplus and GDP growth.

The disruption will be driven by economics. Using TaaS, the average
American family will save more than $5,600 per year in transportation costs,
equivalent to a wage raise of 10%. This will keep an additional $1 trillion
per year in Americans' pockets by 2030, potentially generating the largest
infusion of consumer spending in history.

We have reached this conclusion through exhaustive analysis of data,
market, consumer and regulatory dynamics, using well-established cost
curves and assuming only existing technology. This report presents
overwhelming evidence that mainstream analysis is missing, yet again, the
speed, scope and impact of technology disruption. Unlike those analyses,
which produce linear and incremental forecasts, our modeling incorporates
systems dynamics, including feedback loops, network effects and market
forces, that better reflect the reality of fast-paced technology-adoption
S-curves. These systems dynamics, unleashed as adoption of TaaS begins,
will create a virtuous cycle of decreasing costs and increasing quality of
service and convenience, which will in turn drive further adoption along an
exponential S-curve. Conversely, individual vehicle ownership, especially
of internal combustion engine (ICE) vehicles, will enter a vicious cycle of
increasing costs, decreasing convenience and diminishing quality of service.

The impacts of TaaS disruption are far reaching


ê Savings on transportation costs will result in a permanent boost in
annual disposable income for U.S. households, totaling $1 trillion by
2030. Consumer spending is by far the largest driver of the economy,
comprising about 71% of total GDP and driving business and job growth
throughout the economy.3

ê Productivity gains as a result of reclaimed driving hours will boost GDP
by an additional $1 trillion.

ê As fewer cars travel more miles, the number of passenger vehicles on
American roads will drop from 247 million to 44 million, opening up vast
tracts of land for other, more productive uses. Nearly 100 million existing
vehicles will be abandoned as they become economically unviable.

ê Demand for new vehicles will plummet: 70% fewer passenger cars
and trucks will be manufactured each year. This could result in total
disruption of the car value chain, with car dealers, maintenance and
insurance companies suffering almost complete destruction. Car
manufacturers will have options to adapt, either as low-margin, highvolume
assemblers of A-EVs, or by becoming TaaS providers. Both
strategies will be characterized by high levels of competition, with new
entrants from other industries. The value in the sector will be mainly
in the vehicle operating systems, computing platforms and the TaaS

ê The transportation value chain will deliver 6 billion passenger miles in
2030 (an increase of 50% over 2021) at a quarter of the cost ($393
billion versus $1.481 billion).

ê Oil demand will peak at 100 million barrels per day by 2020, dropping
to 70 million barrels per day by 2030. That represents a drop of 30
million barrels in real terms and 40 million barrels below the Energy
Information Administration's current "business as usual" case. This will
have a catastrophic effect on the oil industry through price collapse
(an equilibrium cost of $25.4 per barrel), disproportionately impacting
different companies, countries, oil fields and infrastructure depending on
their exposure to high-cost oil.

ê The impact of the collapse of oil prices throughout the oil industry value
chain will be felt as soon as 2021.

ê In the U.S., an estimated 65% of shale oil and tight oil — which under a
"business as usual" scenario could make up over 70% of the U.S. supply
in 2030 — would no longer be commercially viable.

ê Approximately 70% of the potential 2030 production of Bakken shale
oil would be stranded under a 70 million barrels per day demand

ê Infrastructure such as the Keystone XL and Dakota Access pipelines
would be stranded, as well.

ê Other areas facing volume collapse include offshore sites in the United
Kingdom, Norway and Nigeria; Venezuelan heavy-crude fields; and the
Canadian tar sands.

ê Conventional energy and transportation industries will suffer substantial
job loss. Policies will be needed to mitigate these adverse effects.


ê The TaaS disruption will bring dramatic reductions or elimination of air
pollution and greenhouse gases from the transport sector, and improved
public health. The TaaS transport system will reduce energy demand
by 80% and tailpipe emissions by over 90%. Assuming a concurrent
disruption of the electricity infrastructure by solar and wind, we may see
a largely carbon-free road transportation system by 2030.


ê The geopolitical importance of oil will vastly diminish. However,
the speed and scale of the collapse in oil revenues may lead to the
destabilization of oil-producing countries and regions with high
dependence on oil "rents." This may create a new category of geopolitical
risks. The geopolitics of lithium and other key mineral inputs to A-EVs
are entirely different from oil politics. There will be no "Saudi Arabia of
lithium." Lithium is a stock, while oil is a flow. Disruption in supply of the
former does not impact service delivery. (See page 54 for further detail.)
ê Other areas facing volume collapse include offshore sites in the United
Kingdom, Norway and Nigeria; Venezuelan heavy-crude fields; and the
Canadian tar sands.

ê Conventional energy and transportation industries will suffer substantial
job loss. 

Policies will be needed to mitigate these adverse effects.


ê TaaS will dramatically lower transportation costs; increase mobility and
access to jobs, education and health care (especially for those restricted
in today's model, like the elderly and disabled); create trillions of dollars
in consumer surplus; and contribute to cleaner, safer and more walkable

ê We foresee a merging of public and private transportation and a pathway
to free transportation in the TaaS Pool model (a subset of TaaS that
entails sharing a ride with other people who are not in the passenger's
family or social group — the equivalent of today's Uber Pool or Lyft Line).
Corporations might sponsor vehicles or offer free transport to market
goods or services to commuters (i.e. Starbucks Coffee on wheels4).

ê The role of public transportation authorities (PTA) will change
dramatically from owning and managing transportation assets, to
managing TaaS providers to ensure equitable, universal access to lowcost
transportation. Many municipalities will see free TaaS as a means
to improve citizens' access to jobs, shopping, entertainment, education,
health and other services within their communities.


The aim of this research is to start a conversation and focus decisionmakers'
attention on the scale, speed and impact of the impending
disruption in the transportation and oil sectors. Investors and policymakers
will face choices in the near term that will have lasting impact. At critical
junctures, their decisions will either help accelerate or slow down the
transition to TaaS. Follow-on analysis by RethinkX will look more closely at
each of these junctures and at the implications of potential decisions.

Many decisions will be driven by economic advantages (including return on
investment, productivity gains, time savings, reduced infrastructure costs
and GDP growth) as well as by social and environmental considerations
(including fewer traffic deaths and injuries, increased access to mobility and
emissions reductions). But other decisions may be influenced by incumbent
industries seeking to delay or derail the disruption. Given the winners-takeall
nature of the A-EV race, early movers to TaaS stand to gain outsized

Our main aim in starting this conversation is to provide an evidencedriven
systems analysis that helps decision-makers who might otherwise
rely purely on mainstream analysis. Decisions made based on the latter
risk locking in investments and infrastructure that are sub-optimal —
economically, socially and environmentally — and that will eventually lead
to stranded assets. These sub-optimal decisions tend to make societies
poorer by locking them into expensive, obsolete, uncompetitive assets,
technologies and skill sets.


Listserv moderated by Toyin Falola, University of Texas at Austin
To post to this group, send an email to USAAfricaDialogue@googlegroups.com
To subscribe to this group, send an email to USAAfricaDialogue+subscribe@googlegroups.com
Current archives at http://groups.google.com/group/USAAfricaDialogue
Early archives at http://www.utexas.edu/conferences/africa/ads/index.html
You received this message because you are subscribed to the Google Groups "USA Africa Dialogue Series" group.
To unsubscribe from this group and stop receiving emails from it, send an email to usaafricadialogue+unsubscribe@googlegroups.com.
For more options, visit https://groups.google.com/d/optout.

No comments:

Post a Comment

Vida de bombeiro Recipes Informatica Humor Jokes Mensagens Curiosity Saude Video Games Car Blog Animals Diario das Mensagens Eletronica Rei Jesus News Noticias da TV Artesanato Esportes Noticias Atuais Games Pets Career Religion Recreation Business Education Autos Academics Style Television Programming Motosport Humor News The Games Home Downs World News Internet Car Design Entertaimment Celebrities 1001 Games Doctor Pets Net Downs World Enter Jesus Variedade Mensagensr Android Rub Letras Dialogue cosmetics Genexus Car net Só Humor Curiosity Gifs Medical Female American Health Madeira Designer PPS Divertidas Estate Travel Estate Writing Computer Matilde Ocultos Matilde futebolcomnoticias girassol lettheworldturn topdigitalnet Bem amado enjohnny produceideas foodasticos cronicasdoimaginario downloadsdegraca compactandoletras newcuriosidades blogdoarmario arrozinhoii sonasol halfbakedtaters make-it-plain amatha