What Does a Driverless Future Mean for Air Travel?
Driverless cars are undoubtedly the future of ground travel, and as America's ability to support a ubiquitous, super fast wireless network continues to improve, these autonomous vehicles will steal customers from airlines.
Air travel is a long and expensive process. Individuals must arrive at the airport hours before their flight to adhere to airports many formalities such as check-in and security. Not to mention the time it takes to drive to the airport or the time wasted when a flight gets delayed. Airports are also confusing and overcrowded. Overall, people forfeit many conveniences when they decide to travel by plane.
The current aviation industry has excelled in America's economic period. Airlines are profitable, but challenges range from spiking fuel prices and insufficient airport capacity to a lack of pilots. With this said, airlines require expensive planes, massive brick-and-mortar operations, and frequent maintenance - which attributes itself to the industry's shallow margins. Once autonomous cars become a viable means of transportation, people will travel by plane less, causing airlines’ margins to compress.
In the United States, there are no fully autonomous cars on the road. Some companies like Tesla have released vehicles with automated functions; however, all cars require an attentive driver behind the wheel. The fact that driving currently inhibits individuals ability to relax or work contributes to airlines' success and people's distaste for driving long distances. Autonomous vehicles will soon require nothing more than a destination, and once cars enable individuals to eat, drink, work and sleep mid-trip, American's preferences for transportation will likely shift away from planes.
The decision between traveling by car or plane depends on the distance of the trip, and as the trip becomes longer, people are more likely to take a flight. With this said, more than three-quarters of people would prefer traveling by car for trips under 5 hours, and about 16 percent of individuals would prefer a self-driving car even when the drive is 45 hours long. In other words, some people intrinsically favor driving over flying regardless of the distance. When all cars are autonomous, the aviation industry will contract. For example, even if only 16 out of every 100 people never fly again, the airline's revenue would contract.
This revenue contraction, coupled with the industry's low-profit margins, could have a catastrophic impact on companies like Southwest, Delta, and JetBlue. These airlines would have to fly fewer miles to reduce costs and employ fewer planes to accommodate their smaller customer base. Airlines will order fewer planes from manufacturers and airport-centric hotels will fill fewer rooms. In short, autonomous cars will steal many customers from the aviation industry.
Written by James Mueller, Edited by Matthew Durborow & Alexander Fleiss
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