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Will autonomous cars make prime property less prime?
WITHIN five years, "robo-taxis" will appear in cities around the world, says Maik Borës, the head of BMW's Future Mobility Team. Customers will summon them by smartphone and be whisked to their destinations with no need for drivers in the cars.
That's just one of the ways mobility is set to change, and the coming upheaval in transport will reshape our lives and the cities we call home, he says.
In Singapore to introduce BMW's new range of iPerformance Plug-In Hybrid Electric Vehicles to the press, Dr Borës works in the luxury carmaker's corporate and government affairs department. His team keeps a close eye on the industry's developments in electro-mobility, urban mobility, automation and connectivity.
The knowledge that self-driving cars are coming is first-hand; BMW will put one on the market by 2021.
For now, the new iPerformance models are the first step here in the "electro-mobility" part of BMW's strategy. The Plug-In Hybrid Electric Vehicles (PHEVs) mix petrol drive with battery propulsion, and are a stepping stone to the day when cars no longer run on fossil fuels.
Other carmakers such as Jaguar-Land Rover and Volvo have announced plans to switch to hybrid drive, while BMW aims to put 25 electrified models on sale by 2025, 12 of which will be fully electric.
But for electric drive to take off in a big way, Dr Borës says that charging networks have to expand, too. "We always see a chicken-and-egg problem: car first or infrastructure? You need them in parallel," he says. Singapore currently has 60 public chargers compatible with BMW's cars, with another 80 in private properties.
Tax rebates and other incentives such as free parking are helpful, too. These have helped electric cars sell well in Norway, he says.
Here, incentives from the current Carbon Emissions-based Vehicle Scheme (CEVS) mean that some of BMW's new PHEVs will be cheaper than similar petrol-only models. A plug-in BMW X5 xDrive40e iPerformance costs S$345,800 including Certificate of Entitlement, while a normal X5 xDrive35i costs S$356,800.
But it's autonomous driving technology that will affect the car industry most. "Transportation will definitely change. There will be much more shared-vehicle concepts," says Dr Borës. "The privately owned vehicle is used for 4 per cent of a day and it's the second largest investment for people after the house or flat, so does this make sense? Probably not."
Eventually, private cars may turn into pleasure vehicles, like yachts are today.
But robo-taxis could affect property values, too. It might happen that suburban areas become preferable to live in, because self-driving cars would mean that living far from the office gives you more quiet time. "You could start work in the car," says Dr Borës.
Prices in the Central Business District (CBD) might be affected more by the decentralisation of workplaces than by autonomous cars. "We have to have different city centres, then we could (better) satisfy mobility needs. In general there will be no skyrocketing prices in any one CBD, but they will be slightly higher in all the CBDs, so there is a more equal distribution," he says. "I don't think autonomous cars will change that situation."