Taxi medallions are licenses by the city for taxi companies, to prevent abuse. But if the software is certified, you don't really need the medallions. Drop $500,000 off the cost of a taxi.
You don't have to pay the 2 drivers that normally share a cab. Drop $80,000 a year off.
Assuming the cars no longer crash (version 2.0?), drop $10,000/year off for taxi insurance.
Combine that with Google-quality routing, and smart-phone taxi ordering, and you're looking at a major price drop for taxi service, assuming some sort of competition. I'm guesstimating a 50-75% drop.
Most people in cities will opt out of owning their own car, and use robo-taxis.
You are looking at an 80-85% drop in the required number of cars in cities (even accounting for current peak traffic volumes. see the KPMG report. I also came to the same number back-of-the-envelope).
Obviously, this will destroy GM and Toyota. Might be good for Tesla as they are still tiny, and I'm sure Elon and Larry have discussed this.
Some other interesting outcomes:
- should increase the total number of trips and miles driven, as lower prices lead to higher quantity demanded, so more wear and tear on cars, and more gas consumed (though less for idling).
- with many driverless cars, they can communicate with each other, driving faster and closer together, and co-ordinating intersection crossing. price of oil change is ambiguous.
- fewer deaths and injuries from accidents, or none at all. The organ transplant industry dies.
- more trees and less concrete lead to cooler cities?
- you can probably get away with more single-lane streets, with no parking, increasing usable land areas in cities by 25%, significantly dropping housing prices.
- in your driverless car, you can talk on your cell, use your laptop, read a book, not be stressed from driving. people may be willing to drive farther to work, increasing sprawl, and also dropping the quantity demanded for housing near the core, dropping prices.
- public transit disappears? though driverless buses would be cheaper too.
- more people bike to work, as it's much safer
- software requirement: interior management for driverless taxis. some video or image recognition for lost purses, people having heart attacks, people throwing up in the back seat.