Finding New Opportunities in the Driverless Car Revolution

At Boxton, we talk about the driverless car revolution ALL the time. Some might even say it borders on obsession.

The reasons are that its impacts can’t be understated. We think that infrastructure improvements being planned right now should revolve around the fact that in 10 years, most people won’t be driving cars (i.e. let’s hold up on building new 4 lane highways and conventional train lines). We think in 15 years, most people won’t have cars. The impacts on the environment are enormous. The impacts on our quality of life (most people spend 42 hours sitting in traffic every year, this is going to be gone) are incredible.

And yet with all the excitement, you also hear all the time that 7 million Americans drive for a living in the US and they will all be replaced. You hear that a life without mailmen, long haul car truckers, uber drivers, and pizza delivery people is on our horizon and that this will truly upend how we transport goods from production to the final end users.

So how do we relate excitement about new technology to the scary reality of the coming changes related to it?

And as with any new technology, the impact this revolution will have on our society are still to be determined. First off, there is a strong case to be made that jobs will be more than adequately replaced by people who manage these processes rather than physically execute them. By way of example, In 1870, 50% of Americans were farmers. In 2012, 2% of Americans were farmers. And yet we are at borderline full employment!

Additionally, with great technological revolution comes great opportunity. The laws of logistics are about to be broken because of driverless technology. Most major logistics networks, (think UPS or FedEx), have to have Distribution Centers that are spaced about 4 hours from each other. Why is that? Because in an 8 hour day, a feeder truck driver needs to be able to deliver a trailer to a hub 4 hours away, pickup another trailer and bring it back on a 4 hour drive back to their home hub. With driverless cars, we’ll no longer be subject to the fact that a typical work day is about 8 hours. Distribution centers can go anywhere! There are 100s of these examples which bring on 1000s of new problems that need to be solved:

  • Could the optimal truck size be much smaller or much larger than it is today?
  • Should we only have trucks on the road at night when there is much less traffic?
  • How are we going to gas up trucks without drivers?
  • How are we going to get product off the trucks and in the hands of the consumers?
  • Will the optimal truck routes be ones like Los Angeles – Boise – Omaha – Denver – New York because driver time is no longer a constraint and always having a full load is the #1 consideration?
  • Can we have automatic pallet loaders and unloaders built into a truck? Should we be getting mail every day?

And so on and so on and so on.

All of these questions are going to create a high demand for people with real world logistics experience (like truck drivers and delivery people) and creative ideas on how to solve them. We are in the midst of a transportation revolution unseen since the combustible engine replaced the horse and buggy.

About Warren Kucker

Before founding Boxton, Warren developed a program at Apple to manage complex, international project logistics. He started his career in supply chain as an Industrial Engineer at UPS in the Metro DC area and has his BA from the Robert H. Smith School of Business at the University of Maryland and his MBA from the Fox School of Business at Temple University.

Finding New Opportunities in the Driverless Car Revolution