This week the magazine Parking Review published an article based on a presentation that James Long, Principal Consultant at Steer Davies Gleave, gave at Parking World 2017. This presentation focused on how Autonomous Vehicles will influence the parking sector and cities. Read the article below:
Nobody can avoid the absolute deluge of articles that are coming out now and media stories relating to autonomous vehicles (AVs). Typically, these are fairly polarised. Some can be characterised as predicting a real reduction in the demand for parking. There are images from various urban designers and architects showing romanticised 2050 visions of what the future might look like, of how our streetscape might start to evolve.
But the debate about AVs starts to become a lot more nuanced when we think about how those different services might be introduced, and how different cities can evolve to respond to the needs.
Over the past year, we partnered with KPMG to explore some of these issues and to consider the issues connecting AVs and parking. We have been looking at which different cities and types of environment might be more susceptible to change.
Our research into the consequences of AVs on the design, provision and management of car parks have been driven by clients who invest in parking assets, both in the UK and globally. They are keen to understand the sort of things that might affect them over the next 10-15 years in terms of their concession agreements and so on.
It is really important to start thinking about the key indications that might start to signal changes in different environments.
Where are we today?
There is a phenomenal amount of work underway both from a private sector perspective and by the public sector. In the UK alone we have numerous different projects operating in Milton Keynes through the UK Autodrive project and the Lutz Pathfinder, and the GATEway project in Greenwich. We are now seeing on-road trials between Oxford and London through the Driven project. Much of this is receiving industry funding through R&D budgets, together with Innovate UK funding.
The government has put some serious investment into AV development. For example, it has announced £51m this year for investment into four test facilities around the country to start to understand how different vehicles could start to respond to their environment.
There is also much activity internationally. Just recently Waymo, formerly Google Cars, announced that its self-driving vehicles are operating as a ride-hailing service in Phoenix, Arizona. These vehicles are totally driverless, which is a real step-change because up to this point everyone has had to have safety drivers in the vehicle. This demonstrates the level of confidence Waymo have in that particular environment.
There is an awful lot of work that still needs to be done. What is working for Waymo in Phoenix is not going to be consistent with what works in a wet rural Welsh road in October. There needs to be a lot of exploration around how you validate and test those different models.
Increasing levels of autonomy
There are around six levels of autonomy, ranging from absolutely no autonomy at Level 0 up to Level 5, which is full automation everywhere. Even a mid-range model on sale today will have all sorts of ADAS features – adaptive driver assistance systems – such as cruise control, autonomous emergency braking and park assist.
And Tesla has announced that the next versions of its vehicles will feature all the necessary sensors from the start to make sure that when they get to a point where they are confident they can switch it over to full autonomy.
Level 4 vehicles are at the point where you start to remove the human responsibility from the driving process, which is the stage where we can start to interact with things like auto valet parking. At Mercedes World in Stuttgart, Germany, Daimler has partnered with Bosch to introduce a fully autonomous auto valet parking environment. This enables the vehicle to go and park itself beyond line of sight. You get dropped off the lobby area and the vehicle heads off to do its own thing.
Other Level 4 applications include shuttles that we are starting to see be tested and deployed out on the street today. These include logistics and servicing vehicles that move around. An interesting part of the Project GATEway trial involved Ocado supermarket delivery vehicles being used on a Berkeley Homes estate to try and understand how these interact when delivering people’s shopping.
There is huge private sector investment in this area. Over the past three years $80bn (£59m) has been spent on new transport modes and technology services, so the momentum is really there. The public sector has also embraced AVs, with the UK government looking into various different regulations to support the development of automated vehicles and to rationalise the process around liabilities and so on.
AVs and land use
So, how could the use of AVs start to play out in individual different environments? There is a great potential to unlock certain land value in areas that may currently have large existing parking facilities in central locations. As AVs develop there might be opportunities to start to locate those parking areas further out of town, perhaps in retail parks.
There will also capacity benefits at a specific car park level. It has been suggested that it might around 2m2 per space could be saved per parking space by having an AV. As people do not need to get in and out of the vehicles where they park, you don’t need the door opening space. Also, the manoeuvrability of AVs is more accurate and aligned, so you will not get defensive parking.
Factors affecting change
Different business models will emerge in the parking sector as AVs become more common. The revenue models for parking presently used will start to become pressurised, particularly if there is a lower level of demand. Parking providers may need to respond by diversifying their services.
Change will not be uniform because no two places are the same. It is thus key to understand the different spatial distinctions around how different cities, places and environments start to shape up to the challenges presented by AVs.
The rate and type of change will be partly down to the market developments regarding different levels of autonomy, but also other factors will become red flags if you own parking assets or are an operator.
Public policy is a huge driver. For example, take the issue of air quality. Paris has significant air quality challenges so is actively exploring ways to manage the parking demand and the number of vehicles driving in and out of the city. In the future, the city may start exploring ways of managing its vehicle fleet better by imposing top-down traffic management measures to encourage the use of AVs.
There are also different land use patterns to consider. For example, there may be a desire to densify certain areas of towns and cities by converting urban realm.
User acceptance will also be a factor. Some demographic groups may be more attuned than others to adopting particular technologies. Steer Davies Gleave has worked with a lot of car clubs to better understand the regional and demographic distinctions between uptake rates. These distinctions have a very significant impact on choosing where shared car facilities are located and where operators decide to provide their services.
New ownership patterns
The final part of these high-level influencers is really the ownership model and whether that is providing a continuity of business as usual or whether that starts to place significant pressure on the parking asset. Working with KMPG we have identified how those different ownership models might start to influence different factors in the parking environment. We have looked at three basic models:
- Private ownership of AVs
- Shared use of AVs in single occupancy
- Shared use of AVs in multiple occupancy
For private AVs, particularly in the early days, we imagine there might not be such a level of change. That might shift over time and we might see car parks relocate to slightly different places. For example, a Level 4 vehicle could be parked on some slightly cheaper land elsewhere in the city. But if it is your own private vehicle, it needs to respond to what you are doing, to your diary of that day. And when issues of congestion are considered, is it really viable for AVs to drop you off, pop home, wait on the driveway and then return to drive you home at the end of the day?
As we move toward shared-use on a single occupancy basis the number of car parks might reduce, particularly because AV fleet providers might focus on high demand destinations that support a range of short and inter-peak parking periods where the vehicles are waiting for different pick-ups. This model will have a knock-on impact on revenues. If you have a shorter inter-peak period, what can you feasibly do with that space? Maybe there is an opportunity to diversify parking business models by thinking about providing EV charging? Many facilities already offer some EV charging, but if the car park provider is dealing with a fleet of vehicles predicated on that solution they could work with an operator to support them.
With shared-use AVs used in a multiple occupancy solution the impacts become much, much more significant. We would start to see numbers of car parks really start to drop as the question becomes where do we have as optimal locations for basing those car parks.
Location, location, location (and more)
We’ve looked at the impacts of the growing use of AV across three main groups:
- Investors and operators
- AV fleet operators
There are many more stakeholders but these are the three we looked at initially.
From an investor perspective, it is very much around the utility of their parking asset. Questions they may ask include:
- Where can they get the most from it?
- Is it worth placing in a different location to make sure they can optimise those capacities?
Developers could start thinking about relocating parking assets altogether. When they start to think about unlocking different types of land, all of a sudden do those city centre car park locations become really valuable in terms of densifying city space? How does a developer make sure they are located in the right place to meet different service demands?
The AV fleet operators are potentially the most interesting group because their entry into the market is the point where business models could start to diversify more. We are seeing the likes of Waymo coming forward and Ford’s Future Mobility services have announced Chariot On-Demand minibuses. Parking providers might ask what are fleet operators looking for in the way of partnerships, so need to make sure they’ve got the right assets in place.
When we think about those evolving needs and revenues we are in revenue-based model that entails charging number of hours parked. As we move forward parking providers could offer different models based on servicing needs. If you’ve got a fleet of AVs, particularly if they’re shared-use, they will need to be regularly cleaned due to the regular turnover. However, what works will be a very particular view depending on the providers’ mix of assets and their willingness to start to evolve some of those business models.
Taking the optimistic line
It could be very easy for parking providers to take a pessimistic view based on an anticipated reduction in demand, but if they have got the right mix of assets and the right attitude to understanding their potential in the future, there are real opportunities out there, particularly with some of the early adopters and early service providers.
In the short-term, it is a case of understanding the market today. Parking providers need to look at where they have facilities, where they are operating services and who their customers are. They then need to develop an understanding of what that means for your business and what the impact of those different signals could be.
There is also need to understand their exposure to change, possibly based on the location of their assets in a city. They need to analyse and interrogate different data sets.
Parking providers should be exploring diversification as part of a different business model. Is there are an opportunity to start to partner with different groups? If so, who is the right partner and how do you approach them? What do these potential partners need? What do you need to provide in terms of flexibility of building design to accommodate that?
Finally, parking for AVs will create a range of infrastructure challenges. How do we make sure that we get the right digital infrastructure in place to communicate the location of parking facilities, the availability of spaces? In what way do we expect people to move around parking facilities?
To answer all these questions we may need to adopt that very simple project management approach: Think, plan and act.
You can read our first two articles here:
- Reclaiming space in the autonomous vehicle era
- Parking demand in the autonomous vehicles era