FTC to Host Public Workshop Examining the U.S. Auto Distribution System Workshop Will Explore Competition, State Regulations, and Emerging Trends in the Industry, Project No. P131202 #478

Submission Number:
V Ziv
Outside the United States
Initiative Name:
FTC to Host Public Workshop Examining the U.S. Auto Distribution System Workshop Will Explore Competition, State Regulations, and Emerging Trends in the Industry, Project No. P131202
Developments of autonomous driving cars are underway. Tesla Motors and Google are the most prominent leaders in this space. Simultaneous developments in devices connectivity, including cars, coupled with the mature autonomous driving technology, are likely to significantly change the transportation as we know it today. Owning and maintaining a car today is accepted as a norm. Public transportation alternative may be cheaper and more enjoyable for some people. Public transport commuters are relieved of the driving responsibility. They might use commute time in many productive, enjoyable ways rather than observing traffic. Current downfall of public transportation is that it does not fill the transportation needs for most car owners due to inflexible set routes and transit times. Once the new autonomous driving technology matures and gains wide public acceptance, that is likely to drive significant transportation changes. New technology is likely to open up more options to people regarding cars ownership and use. Some people are likely to stay with the traditional personal car ownership model simply due to personal preferences. Some people are likely to opt out of personal ownership if given an adequate alternative. Such alternative is likely to be created with the further development of new autonomous driving technologies and cars connectivity to an overseeing control system. If a person can type a desired destination and time of travel into a phone, and the commute need can be promptly matched by a car belonging to a local fleet, such option is likely to adequately fulfill transportation needs for many commuters at much lower cost than traditional car ownership. It is safe to assume that many may choose a yearly subscription to a local transportation services provider over a car ownership if such subscription adequately fulfills their needs. A local services provider may be any private/public operator with a fleet of autonomous vehicles. Car manufacturers may choose to enter this space. This space is currently occupied by taxi services, public transport operators and share ride operators like Uber. The current operators are either inflexible in their services or too expensive. New technologies and new business models are the forces that will make this space far more competitive by driving the costs down and by increasing the service offerings to better match consumers needs. Regulation lags behind technological and societal changes, for valid reasons. The existing businesses need some time to adjust to coming changes, otherwise rapid changes might be destructive to society as a whole despite benefiting a group of consumers. There is a need to balance the protection of existing businesses and to allow progress to disrupt the status quo and bring improved quality of life to millions of people, by offering new business models and services unencumbered with past regulation. In this specific case, dealership business model seems to be long overdue for an overhaul as it does offer very little value adding to consumers. Dealership model is directly opposed to the introduction of new technologies as new technologies require a lot of training and investment in new diagnostic equipment. Dealers do not benefit from those, they come at a cost that dealers are likely to resist. There is little, if any, alignment between dealers business model and the new transportation technologies development. There is a direct alignment between consumers benefit and new technologies development. The conclusion is that dealers needn't get any further protection. They are protected by being married to existing car manufacturers through existing regulations. It would be counterproductive to burden Tesla with outdated regulatory requirements that may require them to align themselves with dealers. Such protectionism of dealers acts as a brake on progress and innovation, two pillars of US leadership role in the world.