Bob Lutz is a former vice chairman and head of product development at General Motors. He also held senior executive positions with Ford, Chrysler, BMW and Opel.
In the Nov. 6, 2017 issue of Automotive News, Lutz forecasts the automotive industry on an accelerating change curve similar to the effect of the automobile on the horse a century ago
It’s getting a lot of attention in real estate circles.
As Uber and Lyft scoot us around town, they and others are gathering detailed data points that will lead to driverless vehicles being able to operate on our road grid with great precision, efficiency and safety. Blending mapping technology with that data is accelerating the process of getting us into driverless vehicles sooner than we think, Lutz contends.
The effect of a driverless vehicle future on the auto industry has big implications on real estate as well.
“Most of these standardized modules will be purchased and owned by the Ubers and Lyfts and God knows what other companies that will enter the transportation business in the future,” says Lutz.
Retail auto sales will be a thing of the past in 20 years, he predicts, and every form of retail support services such as gas stations, auto repair shops, auto parts stores, and quick oil change locations will be obsolete as well. They will be located where the winners in this race want them to be.
When this all might happen is up for debate. But in real estate, bets are long term in nature and an industry change of that magnitude in even 30 years has wide-ranging impacts on values and financing options even in the next 10 years, begging the ultimate real estate question around current uses — what their highest and best use can or should be in the future.
Will single-family homes see more demand further out from the employment centers because commutes are now predictably shorter?
Could some of today’s auto retailer sites be converted to fueling, repair and pooling stations for these fleet owners instead of retail sales locations?
Are there other retail uses for auto parts stores and service stations where they are located today? What happens to retail generally, and is road signage even necessary if my phone and autonomous vehicle are synced up and flagging everything I’m passing? Is there a role for light rail at all?
Real estate investors are just beginning to examine this sea change ahead and asking these questions in anticipation.
Tom Hoban is CEO of The Coast Group of Companies. Contact him at 425-339-3638, or firstname.lastname@example.org or visit www.coastmgt.com. Twitter: @Tom_P_Hoban.