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Are Self-Driving Vans The Future Of Transit?

|Includes: F, Fiat Chrysler Automobiles NV (FCAU), GOOG, GOOGL, LYFT, NSANF, TSLA, UBER

Summary

Whether we like it or not, self-driving vans are probably the future of transit.

Alphabet’s (NASDAQ: GOOG) Waymo and a company called Drive.ai are testing self-driving vans as transit vehicles.

In the test, Waymo’s autonomous Chrysler Pacifica vans will pick passengers up and take them to the bus or light rail stop.

Such hybrid ventures make sense because theymight do the impossible and get middle-class Americans to ride transit.

Waymo is trying to reach the working class withanother pilot program that hauls customers to and from Walmart (NYSE: WMT).

Whether we like it or not, self-driving vans are probably the future of transit. Alphabet’s (NASDAQ: GOOG) Waymo and a company called Drive.ai are testing self-driving vans as transit vehicles.

Drive.ai has deployed autonomous Nissan NV200 vans on the streets of the Dallas suburb of Frisco, Texas, The Verge reported. The bright orange vans will haul people around town in a notoriously car-dependent community.

The Drive.ai vans will try to deter accidents with automated message boards on the side of the vehicle. The message boards are supposed to tell people what the cars are doing.

The great flaw in that plan is the humans probably will not read or pay attention to the signs. A large percentage of the population will only see the signs - if a police officer is standing next to them.

The idea in Frisco is to keep transit buses off the streets of the affluent suburb while still providing those who do not drive with transportation. An obvious use of Drive.Ai’s vans will be hauling commuters to and from the train or bus station.

Waymo Enters the Transit Business

Not to be out done, Waymo is launching a joint venture with Valley Metro, the Phoenix’s transit agency.

In the test, Waymo’s autonomous Chrysler Pacifica vans will pick passengers up and take them to the bus or light rail stop. The test will begin with Valley Metro employs, Ars Technica reported.

Unlike the Frisco test the Phoenix venture will try to offer the elderly, disabled, children, and others who cannot drive access to transit. Such hybrid ventures make sense because they might do the impossible and get middle-class Americans to ride transit.

Waymo Teams up with Walmart

Waymo is trying to reach the working class with another pilot program that hauls customers to and from Walmart (NYSE: WMT). That solves one of the major hassles facing people without a car.

When I lived in Denver without a car, I had no problem getting around town or reaching work. The biggest trouble I had was grocery and other shopping. It is hard to carry several bags of groceries on the bus. Forget about bringing something like a TV set home from the store.

Another obvious solution to that are grocery delivery services like Instacart and Ocado (LON: PLC). Interestingly enough, Ocado is testing driving self-driving vans in England.

One thing is certain here, self-driving vehicles will not replace large scale mass transit like trains, subways, light rail, and buses. To the contrary, autonomous vans have the potential to greatly increase ridership of traditional transit systems if they are deployed properly. So yes self-driving vans are the future of transit.

Smart investors should buy into van-making companies like Ford (NYSE: F) and Fiat Chrysler (NYSE: FCAU) now. Transit agencies might soon provide a vast new market for their products.

This article first appeared at the Car Insurance Samurai a where why we highlight autonomous vehicles.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.