19JULY - SEPT 2020We are swiftly arriving at something magical, a new and disruptive transportation mode: driverless vehicles coupled with mobility services. We think consumers will want this. We think it will be fantastic for them. We think it will be transformative in the same way the smartphone and personal computer have been. Consumers embraced them so completely that they never looked back; flip phones and typewriters were all but gone from their thoughts. We think consumers will likewise flock to this new transportation mode, changing forever their relationship to cars and transportation.But the embrace--the adoption of this new transportation mode--won't roll out the same way as it did for cell phones and computers, instantly across the country and world. Instead, carmakers will have to think of its adoption as coming place by place, location by location--what we call islands of autonomy. These islands are cities but not only cities. They are cities across the world that fit certain demographic criteria, but they are also bounded concentrations of populations in places that range from college towns to cities-within-cities, and they include cities that push beyond their boundaries until they merge into other communities. We believe these islands will be first to experience this transformation due to a number of factors. First, mobility service providers will require network density afforded by cities in order to affordably meet customer demands for 2-3 minute response times, which appears to be a tipping point. Second, early autonomous cars will operate most effectively in geofenced city centers, where they can make the frequent observations of the driving environment, they will need to gather data and improve performance.The islands of autonomy will have enormous consequences for the planning of cities and transportation systems, from how to construct highways to where and how much parking will be needed. For carmakers and others in the transportation and mobility industries, the consequences of the islands are also enormous. The current market, which Helvetica Condensed has existed for decades, will no longer be recognizable. In its place will be a market driven by product, service, and investment A NEW TRANSPORTATION MODE IS SWIFTLY ARRIVING: WHAT IT MEANS FOR THE FUTURE OF AUTO By Gary A Silberg, Head of Automotive, KPMG LLPCXOINSIGHTS
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