Dax Hamman

The Future of Travel: Introducing VaaS - ‘Vehicle as a Service”

Dax Hamman
The Future of Travel: Introducing VaaS - ‘Vehicle as a Service”

Two of my daughters are getting close to the age of driving and it makes me wish that autonomous cars were already a thing, I would sleep much better at night if I knew the danger of their teenage-ness was removed from the safety equation, and that they would never have to share a road with idiot drivers.

Autonomous, or self-driving, cars will deliver on that promise one day. With their ability to monitor what’s happening around them thousands of times a second, and with smart enough brains to be able to predict movements that could cause a collision, accidents will reduce significantly.

Ironically though, they don’t need such complex capabilities to avoid collisions with each other - they need them to avoid collisions with us human drivers. We are frequently unpredictable, and highly illogical drivers that need constant monitoring and analyzing, and we get tired and distracted, and often make driving decisions based on our emotions.

But when humans are taken out of the equation our cars will have a much simpler time of it. To be on the road our vehicles will sign on to a hive, always updating other vehicles of their intentions, and finding out the intentions of others. There is actually a law already in the works in the US that could see such data transmission to be compulsory in new vehicles inside of 5 years, a good first step.

If the actual driving is taken out of the driving experience, we may not have the same emotional attachment with our cars as we do today. Combined with the extraordinary new behaviors that Uber and Lyft have introduced to personal transportation (Uber surpassed 5 billion total rides in 2017 and Lyft exceeded 1 million per day), we will likely see a fundamental change in behavior and attitude to car ownership.

(I wonder if we will even call it “driving”? It would seem an irrelevant verb in such a future. “Going”, “traveling” or “being transported to” would seem to be more accurate).

Introducing VaaS – Vehicle as a Service

VaaS is a subscription model, giving you access to vehicles as and when you need them. Think Uber but without drivers and the vehicles always being available within a minute or two of being needed.

Pricing will primarily be based on the amount of time you need the vehicle and how often, not unlike rental cars today. The likes of Hertz or Enterprise have you covered for days or weeks a time, ZipCar is there for the minutes and the hours. $250 a month might get you to work and back during the week and leave you with a few hours to spare at the weekend. $500 for more flexibility.

Vehicle type will be your next choice. About 75% of my journeys are solo, so a small vehicle will suit me just fine, but sometimes the car is filled with kids and a six-seater comes in handy. Some weekend we drive into the mountains for camping or skiing, so 4-wheel drive is a must. And once in a while I have a large load or a big object to move, so the space of a truck would be a gift.

The family package will have me covered. A small car most of the time, and a range of substitutes when I need them.

And what about luxury? Brand loyalty will remain strong, but like Uber where you are loyal to the service rather than the vehicle make, manufacturers will have to work hard to stay relevant. Some will pivot – the full range Audi subscription could be a thing, but also somewhat limiting to your choices. More likely a subscription company having a brand like Audi exclusively will become a selling point for their own business.

Services will top-up the subscription company fees. Companies like Edison Interactive (who I advise) are already rolling out 200,000 interactive screens into taxis, Uber and Lyfts, and are seeing high demand for the inbuilt wifi and free content channels. These screens are ad supported, something that may reduce the fees to the end consumer when they add autonomous cars to their fleets.

Overall, adoption will be driven by a significantly improved consumer experience over how the world works today. No ownership fees, a pay-as-you-go pricing model, flexible vehicle options and no parking costs are significant reasons to consider the switch.

Now imagine the added motivation that comes from seeing VaaS cars travelling at 200mph shoot past you, the passengers watching TV, working or even sleeping. They aren’t sitting in traffic jams or getting frustrated with other drivers, they are having a seamless and predictable journey.

I can hear the puritans shouting at me. I get it, I love to drive too. Not the commute sort of drive, but the real drive. Those drives where you get to take a sports car through the mountains at speed, or an old land rover through the fields and truly off road. I will still want to do that and be willing to pay for it, but for day to day, I’m all in the VaaS experience.

It wasn’t that long ago that I would always push back on buying an automatic car over a manual. With a full automatic it’s like driving a go-kart, whereas a manual is a much more fun connection with what’s happening. Traffic wore me down and I drive an automatic now; it seems I am not alone, more than 97% of new cars sold in the US this year will be automatic. Progress and change aren’t always fun, but they do have a tendency of happening.

Friends with older children are telling me that car ownership isn't really on their minds like it would have been for us back in the day. In Long Island kids just want Uber accounts, not cars. perhaps that's my way of buying piece of mind for my daughters.

(Suggested to read next: The Future of Travel In A Mixed Reality World)