1. The space taken up by cars, especially when they're moving at appreciable speeds, is immense. Even a theoretical zero-latency network between all cars to minimize following distance can't get below the threshold of the area the car takes up (and in reality you also can't have perfect utilization because vehicles have to slow for turns with finite radii.) This ceiling on concentration of people is too low to be tenable, and it creates the 'bad party' experience where people want new people to stay away from their places, rather than welcoming the increased market size and collaboration opportunities.
2. In a theoretical world of perfect autonomous vehicles, collisions can be reliably prevented. This creates a conflict which goes one of two ways. Either
a. The cars are programmed to do some arbitrary, low amount of people killing to keep the people scared of stepping in front of cars; or
b. The people will be physically trapped off of streets, as if every street in town were a limited access highway, because otherwise people can (and will) walk into streets with impunity everywhere, grinding all automobile traffic to a halt. This is a continuance of the perversion of public space in the US, where high value conduits for commerce (streets) are given over to cars driving at ever higher speeds.