The Future of Transportation – What Should We Expect?

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Flying cars. Driverless cars. 

No, this isn’t the premise of a sci-fi flick. It’s the future of transportation, and according to experts it’ll be here sooner than you think. 

Goldman Sachs Research recently published a robust report on “The Future of Mobility”. It covers  everything from ride-hailing and food delivery to “micro mobility” (think bikes and scooters) – and how access to venture capital has fueled a competitive market for new transportation technology.

You can read an abridged version of the report online or listen to highlights on the podcast Exchanges at Goldman Sachs. The podcast focuses on the central question: Why is mobility about to change more than it has since the invention of the automobile? 

“The 10 years we’ve got going forward, the impact of all of these demographic changes, the regulatory changes as we focus on carbon, and then of course these technologies – particularly autonomous and electric vehicles – we’ve never had all of these things coming together at the same time,” GS Research’s Heath Terry explained. “It would be akin to getting the [Ford] Model T and the interstate system and low gas prices all at the same time.”

Here are some highlights from the podcast.

The mobility market by the numbers

$7 trillion – Global spending on transportation, which generates more than an estimated $700 billion in profits. 

$9 million – From 2012 - 2017, there were less than 9 million young drivers, for the first time since 1994.  

$86 billion – expected spending in online food ordering in the US by 2023.

How the nature of car ownership will evolve over time

According to Terry, one shift already underway in major cities and urban areas is car owners making their vehicles available to rent. 

The ability for an owner to make money on a car that would otherwise be sitting unused (perhaps in an office parking lot) has been appealing to people living in cities where the cost of owning and maintaining a car is high.  

“It makes people think about how to monetize that,” Terry said. “And then you’re also seeing in the future – when you hear Tesla talk about this – the idea that if you own an autonomous vehicle and you’re not using it 95%of the time, then let that autonomous vehicle go out and work for you. 

“If it can be that sort of robo-taxi that you can enter into a pool like that without any real work on your part, why wouldn’t you do it?” 

Terry said that these sort of car-sharing models have seen real investment from venture capital communities. But they can be challenging models to roll out quickly. Companies need to not only acquire inventory, but also convince people their vehicles will be safe in the hands of total strangers.

“But the growth rates are pretty staggering,” Terry said. 

Flying cars could be here sooner than you think

Ride-hailing services like Uber and Blade are already dipping their toes into flying vehicle pools by offering helicopter services in certain markets.  

But if you’ve got The Jetsons or Back to the Future on your mind when thinking of futuristic transportation, you might not have to wait much longer for flying cars and other modes of transport. 

Terry said some of the companies that are particularly aggressive in this space believe they can get flying cars into production and in the market by 2023. In particular, Germany-based mobility company Lilium is developing an on-demand air taxi that promises transport from JFK airport to midtown Manhattan in less than 10 minutes for about $75. 

“I think that’s where the hope is,” Terry said. “Obviously you’re going to have a lot of regulatory oversight on something like that. But as any of us who have sat in JFK to Manhattan traffic know, that’d be a pretty nice thing.” 

This article is for informational purposes only and is not a substitute for individualized professional advice. Articles on this site were commissioned and approved by Marcus by Goldman Sachs®, but may not reflect the institutional opinions of The Goldman Sachs Group, Inc., Goldman Sachs Bank USA or any of their affiliates, subsidiaries or divisions.