Disruptive technology will have far reaching consequences and all investment professionals will need to be tuned in to this so as to not be left behind.  I recently attended a Workshop hosted by Ark Invest which had as its focus the investment opportunities arising from disruptive innovation.

Essentially Mobility as a Service describes a shift away from personally owned modes of transportation and towards mobility solutions that consumers utilise. Some interesting insights were presented, not least of which were:

  • By 2020 fully autonomous vehicles (self-driven) should become commercially available, enabling the rapid rise and growth of autonomous taxi networks.
  • The price of autonomous travel should be roughly half the cost of driving a personal car today and this compelling saving will drive to wholesale consumer adoption.
  • This should lead to autonomous taxis becoming the dominant form of vehicle transportation in urban areas.
  • By 2022 electric vehicles should be cheaper than comparable petrol and diesel propelled vehicles.
  • Current new electric vehicle sales are around 500,000 units. By 2022 it is estimated that this will increase to around 17,000,000 units.
  • The increase in electric vehicle sales and the adoption of autonomous travel should see oil demand to peak by the end of the decade.
  • Current new vehicle sales (petrol, diesel and electric) are around $95,000,000 units annually. Because of the rise of autonomous taxis it is projected that global automobile sales will reduce by around 25% by the early 2020’s.

Time will tell how accurate this thesis is, and personally I think the time frames may be a little optimistic.

What is certain however is that the automotive and related industries face major disruption and many companies will need to adapt or run the risk of being left behind.