Vehicle ownership has been debated as becoming highly disrupted when considering the impact of connected car sharing, particularly in urban areas that offer multiple modes of transportation. For a growing population of urbanites around the world, it is simply cheaper to use a combination of mass transit, walking, biking and on-demand car- and ride-sharing than it is to own maintain, and insure a private vehicle. The cost-to-benefit equation of car ownership is looking unfavorable to many.
A movement to address car-less metropolitan cities could change this. Car-sharing services such as Uber and Lyft might actually stimulate vehicle sales by helping prospective car owners to finance vehicle purchases by debiting their income while they are on the job driving. This theoretically transforms cars from existing as an asset that depreciates to one that produces income, while increasing borrowers’ ability to repay the cost of vehicle acquisition the more they drive. If fully adopted, these ride-share companies can successfully expand their business model into vehicle financing while stimulating driver participation. (Uber, for instance, claims that it is adding 20,000 drivers to its platform every month.)
Insurance is a bit more complicated as joint-ownership spreads out individual risk and possibly clouds the issue of liability (particularly as we enter the autonomous vehicle era). But it is becoming clear that car-sharing organizations and the automakers that support them will command more attention from financial and insurance providers in the coming years, and we will see more structural change in those industries.
Considering their new clout among Congressional bodies, these ride-sharing enterprises should be able to navigate their way through the regulatory and legal processes as they help drivers own and insure their vehicles. This strongly suggests that further disruption among automakers, financial institutions and insurance companies will take place as the connected car movement and the Internet of Things evolves.
Source: How The Internet Of Things Will Impact Vehicles – Forbes.com