Yes Way(mo) or No Way(mo)? How Autonomous Vehicles Impact San Francisco’s Economy

Written by: Jocelyn Branham

San Francisco, one of the largest technology capitals in the country, has in recent years become the testing ground for autonomous vehicles (AVs), also known as driverless cars. While there are an estimated 41 companies currently testing AVs in The City (Shaban et al., 2024), the most commonly known are Waymo and Cruise. 

A subsidiary of Google, Waymo boasts AV’s with over 20 million miles of real world driving experience. Waymo has been testing driverless cars across the country for over a decade, and currently operates fully autonomous ride-hailing services in San Francisco, Phoenix, and Los Angeles (Waymo, n.d.). In 2022 alone, they logged an estimated 2.3 million miles, mostly in San Francisco. The General Motors subsidiary, Cruise, recorded nearly 900,000 miles of driving in San Francisco in the same year. At various points, both companies offered delivery services in addition to ride hailing services (Schneider, 2022). 

While the idea of fully autonomous vehicles and being a passenger in a driverless car may seem bizarre and futuristic, there exist many advantages that AVs have provided to San Francisco since their emergence. The arrival of Uber, Lyft, and other on-demand mobility companies have already reduced driving-related fatalities in SF; AVs have the ability to even further minimize crashes. In 2023, Cruise and Waymo together reported only 102 crashes over a rough 6 million miles of driving distance – an extremely low number (McGillis, 2023). Studies from the World Health Organization report that human error is the critical cause in vehicular crashes, attesting to problems such as speeding, driving under the influence, and distracted driving (World Health Organization, 2023). These would not be problems, however, in a fully autonomous vehicle that lacks the potential for distraction or intoxication, and is programmed to only drive up to the speed limit, not past. 

AVs also have the potential to be much more affordable than current fares for human driving ride-hail services such as Uber and Lyft. Waymo, Cruise, and other AV companies own and maintain their cars as well as pay for their own autonomous technology (McGillis, 2023), in turn allowing for AV ride-hailing prices to be very cheap. Additionally, AVs seem all the more desirable due to the exclusion of the tip for a human driver. 

Similarly, AVs are much more environmentally conscious than the average gasoline car. Waymo’s vehicles produce zero tailpipe emissions, which helps to leave no carbon footprint and contribute towards cleaner air quality in San Francisco (Waymo, n.d.). Cruise sources renewable solar energy generated by family-owned farms in California’s Central Valley to power its vehicles (Grant, 2022); in turn, Cruise also produces zero carbon emissions. A 2023 case study found that if just 6.6% of cars in San Francisco were replaced with electric AVs, the city would experience an estimated 40% decrease in fine particulate matter concentrations, which are known to be a cause of respiratory problems like asthma (Whitmore, 2023). This means that the continued emergence of energy-conscious AVs will lead to decreased air pollution in San Francisco. 

While there are many proven advantages and potential future benefits of driverless cars in San Francisco, there are also several associated costs and risks. The safety of AVs has been a huge point of controversy since they began testing, especially since they began fully servicing rides without human supervision behind the wheel. Cruise had a particular incident in 2023 in which one of their AVs dragged a pedestrian in San Francisco to the side of the road. The pedestrian had been hit by a driver in a regular car and knocked to the ground in front of the Cruise, which then briefly paused before continuing over the pedestrian. The AV then attempted to pull out of the flow of traffic to the side of the road, but the pedestrian was still pinned under its tires and suffered critical injuries. Following this incident, Cruise was forced to recall all of its vehicles operating in The City in order to update software and improve safety measures (Associated Press, 2023). This is just one of many reported incidents for which AV companies have faced safety reprimands, demonstrating the true lack of definitive knowledge about AV safety, even after multiple periods of testing and improvements. 

A 2023 article from the Service Employees International Union quotes Brandon Dawkins, Vice President of Organization: “By introducing autonomous vehicles into the mix without proper safeguards and transitional measures, there is a real risk of displacing gig workers, jeopardizing their primary source of income, and endangering public safety” (Dawkins, 2023). San Francisco supports a very large population of food delivery and rideshare drivers, known as a gig economy. There is strong concern that these employees could be displaced by the rise of delivery and ride hailing services now offered by AVs. If AVs took over the gig economy in The City, gig workers would be left in an unfavorable position. One San Francisco Uber driver of 7 years commented that he has found himself driving longer hours and making less money (Mojadad, 2023). This could have a huge impact on the labor market in San Francisco, with the real potential for severe job loss in multiple prominent industries. 

Another likely impactful cost of AVs is a decline in government revenue. With humans driving and parking their own cars, the government collects parking garage fees, parking meter fees, and more. With AVs on the rise, there is now a threat to lose much of that revenue through the decrease of human drivers on the road, and the drastically diminished need for parking. Research from the University of Oregon states, “The risk of declining parking revenues actually has the potential to rock the financial sustainability of municipal finance harder than just those fees/fines…Without parking revenue, a local government could be in danger of going into default if parking garages are no longer necessary. This has implications…that go beyond a parking meter or parking garage” (Clark et al., 2017). If the prominence of Waymos, Cruises, and other AVs truly do force revenues to decline, the government will face a serious challenge to the local economy and will have to accommodate and adjust accordingly. 

There are many pros and cons to autonomous vehicles in San Francisco. On one hand, AVs can reduce crashes by eliminating human error, provide cheaper services than human employees, and improve air pollution through decreasing carbon emissions. On the other hand, AVs have yet to demonstrate fully reliable safety measures and therefore continue to cause controversy, pose a threat to gig workers who contribute greatly to San Francisco’s economy, and may lower government revenue. While there is no clear-cut solution to these issues, it is imperative that Waymo, Cruise, and other AV companies on the rise find ways to properly immerse their vehicles into San Francisco without disrupting the economy. Some important actions include improving safety standards, clarifying regulations, continuing to monitor and test technology, and addressing economic issues that begin to emerge.

References

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https://www.nbcbayarea.com/investigations/driverless-cars-san-francisco/3289955/ Unsplash. (2023). Photo by gibblesmash asdf on Unsplash. 

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