An Analysis of the Use of Autonomous Vehicles in the Shared Mobility Market: Opportunities and Challenges

Abstract

The rapid growth of the sharing economy has propelled shared mobility to the forefront of the public’s attention. Continuous advancements in autonomous driving technology also bring new opportunities and challenges to the shared mobility industry. This study comprehensively analyzes the impact of using land-based autonomous vehicles (AVs) to provide shared mobility services, utilizing SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), PESTLE analysis (Political, Economic, Social, Technological, Legal, and Environmental), and Porter’s Five Forces (the bargaining power of suppliers, the bargaining power of buyers, threats of new entrants, substitutes, and rivalry). The findings reveal that AVs can provide improved shared mobility services by increasing transportation safety, reducing emissions, reducing costs, enhancing traffic efficiency, and increasing customer satisfaction as well as the profitability of shared mobility services. However, challenges such as technological and policy uncertainties, safety concerns, high initial costs, inadequate public communication infrastructure, and the absence of standardized regulations can hinder the widespread adoption of AVs. The benefits are also restricted by the low market penetration rate of AVs. To promote AVs in the shared mobility market, this study also provides implications for AV stakeholders tailored to the evolving shared mobility market dynamics.

1. Introduction

With the rising demand for resources, the sharing economy has gained more and more attention among the public. The sharing economy provides idle resources for others’ short-term usage, thereby maximizing the use of resources and improving economic benefits [1,2]. In recent years, the sharing economy has developed rapidly, and many digital platforms provide various types of sharing services, such as housing (Airbnb), working (Impact Hub), and transportation (Uber, Car2GO). As a part of the sharing economy, shared mobility has emerged with the advancement of urbanization. Shared mobility is defined as the travel option of separating vehicle ownership and usage to maximize the utilization of social mobility resources [2]. Urbanization leads to an increasing number of vehicles and complex urban planning. However, the current urban transportation systems are often associated with insufficient public transport access and high motorization as well as high environmental pollution, bringing huge financial and environmental burdens [3]. This boosts the demand for shared mobility. Shared mobility allows consumers to access various transportation modes on demand, including car-sharing, ride-hailing, car-pooling, etc. [4]. Digital platforms such as Uber provide shared mobility services, allowing people to access temporary resources to fulfill travel demands with high flexibility and convenience. As part of sustainable urban development, shared mobility improves the efficiency of urban space utilization and reduces the number of vehicles and parking needs in cities, thereby reducing traffic congestion and environmental pollution [2].

As shared mobility has played an important role, innovative autonomous driving technology enables the use of shared autonomous vehicles (SAVs) on the road. Autonomous driving technology uses computer-controlled systems in land-based vehicles to replace humans in driving. The ultimate goal is that vehicles can automatically drive to the required destinations without human interaction [5]. Autonomous vehicles (AVs) driving on the road are believed to create promising innovative visions for urban transportation systems since they can reduce human errors, increase road safety, enhance traffic efficiency, and improve sustainability [5]. Thus, it is worth exploring the impact of AVs that provide shared mobility services.

Previous studies have adopted various methods to evaluate the impact of deploying AVs in the shared mobility market. Specifically, data-driven models are used to quantify the impact of SAVs. For instance, one study developed ride-sharing and car-sharing models based on license data from Langfang, China, to investigate the feasibility and effect of SAVs [6]. Surveys have also been applied to analyze attitudes. For example, surveys of college students at the University of Alabama were conducted to investigate their opinions about SAVs. Their answers were used to predict their future travel behaviors [7]. However, due to limitations in data scope and scale, studies using models and surveys may not well reflect the overall picture of the use of SAVs. In addition, literature review is also used in this field. For instance, one study conducted a systematic literature review to investigate the service attributes and impact of SAVs in urban mobility systems [8].

Apart from these methods, strategic business analysis tools also contribute to analyzing the impact of SAVs. SWOT analysis, PESTLE analysis, and Porter’s Five Forces are important strategic analysis tools that have been adopted for decades. Specifically, numerous researchers have used SWOT analysis as a strategic planning technique to evaluate organization status [9]. It not only evaluates the current situation of a business but also analyzes the difference between reality and plans. Hence, using SWOT analysis can help identify the internal strengths and weaknesses to evaluate a business’s competitiveness. It also contributes to discovering and seizing market opportunities. Different from SWOT analysis, PESTLE analysis aims to develop an overall and comprehensive understanding of the external market environment. It investigates how political, economic, social, technological, legal, and environmental factors can influence the macro-environmental aspects of business operations. In addition, Porter’s Five Forces analysis evaluates industry competitiveness and attractiveness, aiming to develop industrial strategies. The combination of PESTLE analysis, Porter’s Five Forces, and SWOT analysis is widely used to analyze market situations and future developments in various industrial sectors because they can provide a comprehensive view of the business environment and organizations’ competitiveness [10]. For example, PESTLE analysis, Porter’s Five Forces, and SWOT analysis were adopted to thoroughly analyze the current internal and external conditions of the company Indah Kiat Pulp and Paper to develop subsequent strategic plans [11]. These three analysis tools were also used to analyze the company Sido Muncul’s internal situation and the external environment [12].

However, a limited number of studies have applied these analysis methods to analyze the impact of AVs in the shared mobility market. For instance, SWOT analysis was used to analyze the market potential of the driverless car-sharing model in Germany [13]. PESTLE analysis was adopted as a macro-environmental analysis method to evaluate the global road transport development with regard to AVs [14]. Porter’s Five Forces was applied to analyze the automated driving industry [5]. However, a research gap exists because these studies neglected to investigate the use of AVs in the shared mobility market, and they also applied these analysis tools separately, lacking an overall view of the business environment. To fill this research gap, this study aims to combine these three analysis tools to provide an in-depth and overall understanding of the market impact of SAVs and to propose strategic implications for stakeholders.

Therefore, the contributions of this study are twofold:

• This study fills the research gap of adopting SWOT analysis, PESTLE analysis, and Porter’s Five Forces to evaluate the impact of using AVs in the shared mobility market, aiming to obtain comprehensive market insights;
• This study provides managerial implications for relevant stakeholders of SAVs, including automobile manufacturers, third-party shared mobility service providers, and governments.

This study is organized as follows: SWOT analysis is conducted in Section 2. A detailed PESTLE analysis is developed in Section 3. Porter’s Five Forces presented in Section 4 is used to critically analyze the market potential of introducing AVs to the shared mobility market. Section 5 provides implications based on the findings. Section 6 gives a summary of the study.

2. SWOT Analysis

SWOT analysis is a fundamental tool to analyze an organization’s internal environment, external environment, and market position, focusing on four aspects: strengths, weaknesses, opportunities, and threats [10]. It is regarded as a simple and concise method that can provide a reliable analysis for the organization [15].

2.1. Strengths

AVs can increase transportation safety by reducing human errors and car accidents [16]. There are about 11,365,000 car accidents per year around the world, and about 3000 people die in car accidents every day [17]. Specifically, over 40% of fatal car accidents are related to the combined human errors of alcohol, fatigue, drug involvement, and distraction [18]. The use of AVs can significantly increase road safety. It is estimated that when the market penetration rate of AVs is 10%, AVs can reduce the risks of vehicle crashes and injuries by 50%; when the penetration rate is improved to 50%, the risks can be reduced by 90% [18].

Apart from enhancing transportation safety, AVs can also optimize traffic by increasing transportation efficiency and reducing congestion. Autonomous driving technology features technological innovation in transportation, requiring artificial intelligence, smart sensors, vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) communication technology, etc., which can bring high efficiency, convenience, and better passenger experience [19]. Specifically, AVs can exchange information with other AVs on the road and predict the driving trajectories of surrounding vehicles, such as whether they will brake or accelerate [18]. Based on this information, AVs can adjust driving speed and stability by changing speed, lane, etc., in advance. With traffic monitoring systems, AVs can improve driving efficiency on roads and across intersections by maintaining shorter but safe and reasonable distances between vehicles, selecting more efficient routes and achieving more coordinated fleets [20]. In this way, SAVs can significantly alleviate traffic congestion, improve traffic efficiency, and save vehicle fuel consumption. Hence, the use of AVs in the shared mobility market can bring massive benefits by enhancing road safety and improving traffic efficiency.

2.2. Weaknesses

There are high initial investment costs for developing, testing, and purchasing AVs, leading to increasing financial burdens and decreasing early-stage profitability for automobile manufacturers and shared mobility service providers [6]. AVs are equipped with sensors, communication technology, GPS technology, digital platforms, etc. For instance, the light detection and ranging system used by many AVS costs USD 30,000 to USD 85,000 each [21]. The high costs also impede the wide use of AVs by influencing large-scale production and public accessibility. However, the initial purchasing costs of AVs may be influenced by the market penetration rate and mass production. It is predicted that if the market penetration rate of AVs is around 10%, there can be an additional USD 10,000 deducted from the purchase price of a new AV in the first seven years after the initial launch. If the market penetration rate is around 90%, the cost will drop to USD 3000 [18]. It is also estimated that, after mass production, the added costs per AV will eventually be around USD 1000 to USD 1500 [22]. However, it may remain expensive for some price-sensitive stakeholders.

2.3. Opportunities

AVs have competitive advantages in the market, which can create major opportunities. As also discussed in Section 2.1, AVs can improve user experience by providing a safer and more efficient ride experience than conventional vehicles [6,23]. This can attract more users and increase user satisfaction. In addition, SAVs can connect the first-mile and last-mile travel in areas with low public transport density by cooperating with public transport. It can enhance synergies between vehicles and transit [23]. In this way, these areas can maintain accessibility even during hard times of poor climate or energy disruption, increasing traffic resilience. Hence, SAVs provide opportunities for attracting consumers and developing closer relationships with public transport.

2.4. Threats

Users tend to worry about the safety performance of AVs in the shared mobility market [16]. When AVs are used on public roads, it is challenging for autonomous driving systems to operate well under all circumstances due to technological limitations, which is explained in detail in Section 3.4. Although AVs can significantly reduce human errors that cause car crashes, machine errors still exist [24]. The autonomous driving system should identify objects in the path, their materials, possible next paths, etc., to make judgments and actions. However, identifying people, objects, and obstacles on the road is much more difficult for self-driving systems [25]. Objects on the road may have various positions, movement trajectories, line of sight occlusion, etc., which affect the judgment of the autonomous driving system. Different materials of objects also influence recognition capabilities because computer vision is much worse than humans at identifying material components [25]. Bad weather may also affect sensor recognition. For example, road reflections on rainy days may have a greater impact on the camera than the naked eye, further affecting autonomous driving operations. In March 2018, a self-driving Uber SUV had a fatal car crash and killed a pedestrian in Tempe, Arizona. Although Uber adopted quick actions to respond to the tragedy, including withdrawing its AVs from public roads, firing test drivers, and closing the autonomous driving testing hub in Arizona, the sad news still triggered people’s safety concerns over SAVs [26].

In addition, there are cybersecurity concerns about autonomous driving systems. The public is worried about whether the driving system may be attacked by hackers to influence normal driving behaviors and cause safety problems. If the technological system malfunctions or is attacked, it will pose threats to the reliability and security of the service. The most severe potential attacks on AVs are expected to be those that intervene with vehicles’ global navigation satellite systems and those that confuse vehicles’ operating systems with fake information [27]. They can lead to incorrect driving destinations and unstable driving paths. However, the majority of cyberattacks obtain unauthorized access to a system to obtain information, rather than disrupting the normal operations of the system [28]. Although the possibility of disruptive cyberattacks is relatively low, potential data leakage can also influence the reputation and sustainability of SAVs because AVs are highly dependent on autonomous driving systems and are largely influenced by the normal operation of systems. Therefore, it is important to ensure the stability and security of large-scale autonomous driving systems through strong defense measures. The National Institute of Standards and Technology in the USA has developed a cybersecurity system to protect critical network infrastructure that is used in autonomous driving technology [29]. The security architecture can be installed at the early stage of setting up V2V and V2I technology and relevant communication infrastructure, thereby limiting cyberattack occurrence and reducing potential damages.

There are also concerns about determining the liability of possible AV accidents. When AVs are widely applied, accidents are inevitable. Different from human drivers, AVs have smart sensors and computer vision software that enable them to make wiser decisions. However, their decisions can still be challenged when injuries and property losses occur. For instance, if pedestrians and passengers may be harmed at the same time, whose safety should AVs prioritize? How should liability be determined for an accident caused by veering into another lane to avoid a collision with an obstacle ahead? How should liability be determined for accidents caused by vehicle loss of control due to road reasons such as slippery roads, damaged road surfaces, etc.? Compared with property losses, is it more important to discuss how self-driving cars should prioritize minimizing injuries to passengers or pedestrians? These questions have raised concerns about the liability of AVs in accidents. In practice, methods are adopted to help determine liability. For example, the California Department of Motor Vehicles requires crash and disengagement reports to evaluate faults. In addition, datasets obtained by sensors are also useful for determining liability [30]. However, these practices are far from enough to establish a standard and systematic method for identifying liability. Therefore, unclear accident liabilities of AVs remain threats until regulated determinations of liabilities are proposed in consensus.

The main findings based on the SWOT analysis are summarized in Figure 1.

3. PESTLE Analysis

PESTLE analysis is adopted to evaluate the political, economic, social, technological, legal, and environmental aspects from a macro level. PESTLE analysis can capture many external risks and issues by evaluating the environment before starting a project [31].

3.1. Political Factors

Political factors are the influencing policies and regulations for SAVs. Policy support, government regulations, and a stable political environment are necessary during the shift from conventional vehicles to AVs in the shared mobility market.

For policy support and regulations, the development and use of AVs have aroused political interest. Strong support from governments enables individuals to adopt innovative technologies [32]. Policies issued by governments in Europe and the USA have played important roles in supporting the development of autonomous driving technology [33]. For instance, the National Highway and Traffic Safety Administration has already encouraged states in the USA to start allowing AV testing on public roads with standard procedures. However, directly licensing AVs to the public is still not allowed [34]. Governments should provide more support through transportation policies and regulations to stimulate more sustainable mobility, such as establishing standard and official guidelines for certifying AVs [35].

The stability of the political environment and long-term government commitment are also critical to the sustainable development of AVs in the shared mobility market. In the UK, the government established the Centre for Connected and Autonomous Vehicles in 2015, aiming to implement legislative frameworks for the commercial use of AVs [36]. Its parliament also started legislation for identifying liability problems when AVs were involved in car crashes. The goal was to ensure that the UK could lead the world in testing, developing, and applying AVs [33]. The London government also aimed to reduce the travel trips provided by taxis and private-owned cars to 20% by 2041 [37]. It shows the intention to enable mobility-as-a-service and encourage shared mobility services, providing long-term political support and development opportunities for AVs. For governments, guidelines should be developed based on practical situations to achieve national or even worldwide requirements. They can provide a supportive political environment for encouraging the use of SAVs. In addition, political support for the unprecedented issues that AVs may face is still lacking. For instance, the wide use of SAVs requires the government to invest in public infrastructure, including V2V and V2I communication systems with traffic signals. However, few relevant communication systems for AVs have been established [22]. Therefore, as solutions to future smart mobility for urban transportation, AVs should gain high and stable political commitment from local and national authorities.

3.2. Economic Factors

Economic factors refer to economic conditions that can influence SAVs. The development levels of the local economy and the industrial structure can affect the use of AVs in the shared mobility market.

When the local economic level is weak, consumers tend to choose shared mobility services instead of purchasing and maintaining private cars. When maintaining the same travel intensity as private cars, SAVs can replace a significant number of private or family-owned cars to reduce individual financial burdens. For instance, a study used agent-based models to distribute vehicles around a core area in Austin, Texas. The study simulated SAV operations within a 12 × 24 mile geofence, which was set as a high-intensity mobility area for shared AVs to conduct mobility trips. Research showed that each SAV could replace approximately 10 private or family-owned vehicles [38]. Thus, consumers will tend to choose SAVs to obtain more economical transportation solutions in areas with weak economies, especially in areas with high mobility levels such as urban areas with serious traffic congestion and pollution problems.

In addition, attracted by the economic benefits discussed in Section 2.1, areas with weak economies can further promote SAVs. The strengths of safe driving and high traffic efficiency of SAVs can reduce travel costs and bring economic benefits [20]. For instance, it is estimated that, in the USA, travelers experience delays of up to 8.4 billion hours. Traffic congestion can waste 4.5 billion gallons of fuel, causing huge financial losses [39]. In addition, smart parking by SAVs can save fuel by reducing the amount of fuel wasted searching for parking spaces and can also save costs through remote parking [40]. Moving a parking space outside central business districts is estimated to save USD 2000 per year, and moving it to suburban areas can save an additional USD 1000 per year [41]. Overall, the economic impacts brought by AVs are expected to range between USD 200 billion to USD 1.9 trillion worldwide by 2025 [42]. It is also expected that, when the market penetration rate of AVs reaches 90%, the overall economic effects can reach USD 442 billion [38]. Hence, using SAVs is financially attractive for areas with low economic levels.

Considering areas with specific industrial structures, the use of SAVs can also be boosted due to added value. During autonomous driving, drivers and passengers can enjoy safer and more comfortable rides, enabling them to carry out a range of non-driving-related activities [35]. For instance, they can watch movies, drink, use laptops, and entertain themselves. Relevant companies such as the IT industry, entertainment industry, and beverage industry can benefit a lot from SAVs by providing on-board entertainment and office services [43]. For example, using SAVs is expected to bring an extra USD 100 billion to the relevant industries for entertainment and advertising and USD 28 billion to the beverage industry worldwide [44]. Hence, when the relevant industries are important components of local economies, the use of SAVs will be promoted.

3.3. Social Factors

Social factors refer to the social, cultural, and demographic situations that influence the use of SAVs. Factors of social safety, demographic structure, social lifestyle, and employment rate can influence the use of SAVs.

Social safety influences the use of autonomous driving technology. Traffic accidents have always been a serious worldwide problem, and the use of AVs is regarded as a potential solution [45]. It is estimated that using AVs can reduce the fatal accident rate by 40% [18]. The social pursuit of road safety motivates individuals to adopt autonomous driving technology and related services [46,47]. Studies also prove that the social pursuit of road safety enhances consumers’ perceived safety and influences their behavioral intentions for using AVs [46,48]. Hence, the use of SAVs can be stimulated by the social safety factor.

Specifically, changes in demographic structure affect the demand for shared mobility. SAVs can provide more equitable travel options by providing mobility for the elderly, disabled, low-income, and non-drivers [23]. For instance, within an aging society, an increasing number of non-drivers face travel inconveniences and declining travel demands. Because they have physical limitations in transport, they may choose to reduce trouble by avoiding driving under poor climate conditions, unfamiliar roads, heavy traffic, at night, etc. Similarly, for vulnerable groups such as children and people with mobility impairments, it is also difficult to travel with conventional vehicles. However, SAVs enhance their mobility independence, as stated in Section 2.1 and Section 2.3. From a social perspective, SAVs increase mobility equality and transport demand for the overall population [2], contributing to positive social atmospheres.

However, within a social environment that promotes healthy work and lifestyle, promoting AVs can be discouraged due to potential negative impacts. The use of AVs may also lead to a rising unemployment rate because many taxi drivers can be replaced by AVs, which may lead to opposition to AVs among the public. In addition, larger market penetration of AVs can decrease the walking distance of users, which may influence health and social welfare [18].

3.4. Technological Factors

Technological factors refer to technological development and innovation that influence SAVs. Due to technological limitations in autonomous driving technology and inadequate communication infrastructure, practical services provided by SAVs are restricted.

Limited development of autonomous driving technology increases the difficulty of deploying AVs. Shared mobility has been accepted widely with the emergence of mobile internet technology in the past decade [2]. Similarly, the deployment and user acceptance of AVs are also significantly influenced by the development of autonomous driving technology. The Society of Automotive Engineers defines six automation levels, but only vehicles at level 5 can be considered completely AVs [49]. Existing AVs still need human control when necessary, and it is estimated that completely autonomous driving vehicles that do not need human intervention and control will be available from 2030 onward [35]. In other words, the current autonomous driving technology is still developing and has technical limitations. When facing complex environments such as poor weather and imperfect road conditions, the limited autonomous driving technology may affect the performance and reliability of autonomous vehicles, leading to safety concerns [50]. Waymo provided autonomous ride-hailing services to a limited number of cities, namely Phoenix, San Francisco, Los Angeles, and Austin [51]. Therefore, the trials of SAVs have still been limited, which prevents analysis of the wide use of SAVs. However, with the rapid development of autonomous driving technology, the limited use of AVs can be improved. It is expected that, in 2035, the market share of highly and fully AVs can optimistically achieve 11% to 42% [35].

In addition, to fully utilize the benefits of AVs, the problem of inadequate communication infrastructure needs to be solved. Stable and high-speed communication and internet infrastructure are critical to support real-time communication, navigation, and data transmission for SAVs. For instance, when AVs need to exchange driving information with other vehicles on the road, they need the technological support of V2V and V2I communication infrastructure. The National Highway and Traffic Safety Administration required that V2V and V2I communication capabilities be forcibly equipped for AVs [52]. Therefore, communication infrastructure need to be widely constructed and applied before deploying AVs in the shared mobility market.

3.5. Legal Factors

Legal factors focus on the influence of legal regulations and frameworks on SAVs. The legal aspects of license, road safety, data privacy, and accident liability should be critically evaluated.

For licensing AVs, many USA states such as California, Michigan, Florida, and Nevada, as well as Washington, D.C., have proceeded with AV-enabling legislation to regulate AV licensing and operation. In California, a law enabling AV licensing (SB 1298) was issued in 2012, stipulating specific requirements for AVs through more detailed legislation. Specifically, the Department of Motor Vehicles has strict regulations on AVs in multiple aspects. For instance, AVs must obtain insurance guarantees before they can be tested on the road. AVs’ abilities to shift to manual control and sensor data storage are also evaluated [53]. China has issued the Draft Proposed Amendments of the Road Traffic Safety Law that regulates the requirements of testing and passing, as well as liability allocation when traffic accidents or violations occur [54]. Although individual USA states have adopted incremental methods to legislate AVs, no federal guidance for fully or partially AVs on public roads has been issued, apart from testing [18]. Hence, governments need to establish systematic regulatory frameworks to support the use of SAVs [34].

Enhancing road safety for AVs is also an important concern. American federal legislation has suggested that reducing the risk of vehicle accidents is the primary transportation goal. To enhance road safety, the Nevada government requires at least 10,000 miles of autonomous driving and records of operating the vehicle in complex situations before AVs are allowed on the road. The government also evaluates the performance of AVs in different traffic scenarios to identify pedestrians and control speed. For instance, AVs need to slow down when approaching schools [38]. Hence, improving road safety for AVs through legal regulations remains a top priority.

As discussed in Section 2.4, the adoption of autonomous driving technology changes the way accident liability is determined. However, there are currently no laws that clarify and determine accident liability involving AVs. Numerous studies raise confusion about how legislatures should modify current laws when facing increasing AVs and their shared mobility services [55,56]. Hence, systematic laws for clarifying the division of liability for accidents involving AVs are needed.

User privacy is another concern [57]. During the operation of SAVs, sensitive privacy information can be obtained. For instance, to provide personal shared mobility services, AVs need to record and evaluate user data, including the frequency of using the sharing mobility service, average trip time, frequently visited places, etc. SAVs can also identify users through mobile numbers, facial recognition, and fingerprints. Although it seems normal for SAVs to improve service quality, the information obtained is highly sensitive and involves personal privacy. There are privacy concerns about AVs’ data processing, storage, and transmission abilities that may cause data leakage. In addition, since the shared mobility platforms possess SAVs and have access to collected data, these platforms face strict data protection requirements when collecting, analyzing, and storing user data. Some governments may also require access to AV travel data, including trip destinations and driving routes, which is also controversial. The leakage and misuse of personal private data can cause serious legal violations [57]. Ensuring the security of private user data is a critical issue during the deployment of SAVs.

3.6. Environmental Factors

Environmental factors are related to the influence of the natural environment and sustainable development on SAVs. Environmental problems faced by the transportation industry, such as road congestion, environmental pollution, noise, excessive carbon emission, etc., promote the use of AVs in the shared mobility market [35]. Over the last several decades, the transportation industry has been mainly responsible for global warming and carbon emissions [58]. The transportation sector is responsible for 23% of carbon emissions generated in 27 EU member countries [59]. Facing these problems, global efforts have been made to reduce the negative impacts brought by transportation. The shift to AVs is a good way to create positive impacts on the environment. As discussed before, the use of AVs can enhance traffic efficiency and reduce carbon emissions. It is estimated that AVs can help reduce carbon emissions up to 94% [35]. If SAVs are driven by electricity, this may further reduce carbon emissions and benefit the environment.

However, there are also potential negative environmental impacts of SAVs. Since SAVs provide more travel mobility, there may be increasing travel demand and empty runs. An increase of 8% to 17% vehicle miles traveled (VMT) is estimated, since SAVs need to relocate, arrive, or depart for empty runs [60], leading to increasing carbon emissions and fuel consumption.

Figure 2 summarizes the major findings of the PESTLE analysis.

4. Porter’s Five Forces

Porter’s Five Forces is a comprehensive analysis method for assessing industry competitiveness by considering five key elements, namely, bargaining power of suppliers, bargaining power of buyers, threat of new entrants, substitutes, and rivalry. This method can help understand the intensity of competition and profitability potential within an industry [61]. As a commonly used market analysis tool, Porter’s Five Forces is widely used to analyze competition situations in various industries. For instance, it was used to evaluate the competition level of the Turkish apparel industry [62] and to analyze the Shale gas industry in China [61].

4.1. Bargaining Power of Suppliers

The bargaining power of suppliers depends on their ability to control key resources, technologies, and services. For SAVs, suppliers may include autonomous driving technology providers, parts suppliers, IT companies, etc. Automobile manufacturers in the shared mobility market mainly act as new entrants, which are further discussed in Section 4.3. The rapid development of digital information technology has promoted the penetration of IT companies into various industries, including the shared mobility market [63]. Although the IT industry has long been a part of producing AVs, they are often classified as parts suppliers because automobile manufacturers have mainly controlled the industry, from product design to distribution. Different from conventional vehicles, AVs are manufactured not only by the current automotive industry but also by non-automotive sectors. Because AVs incorporate multiple technologies such as sensing, artificial intelligence, navigation, and high-definition geospatial data, the IT industry has been able to exert its competitiveness and enter the AV market [63]. IT companies provide vehicle software systems such as entertainment and artificial intelligence applications. As ’gatekeepers’, they have direct access to users, which promotes their participation in SAVs. IT companies can also capture the opportunities provided by AVs through online access, connectivity, and data-driven mobility [64]. Therefore, the current market status held by conventional automobile manufacturers and parts suppliers such as Bosch, Denso, and Continental is challenged by the penetration of IT companies, including car-sharing platform companies; technology companies developing AI, sensing, and navigation, such as IBM, NVIDIA, and Intel; and technology investors, such as Apple, Baidu, and SoftBank [63].

4.2. Bargaining Power of Buyers

Buyers in the shared mobility market are mainly consumers who have travel needs. Buyers’ bargaining power is mainly reflected in consumers’ travel options between SAVs and other modes of transportation. If consumers have high bargaining power, they can choose other shared mobility services or require cheaper service prices with high quality. As discussed in Section 2.1 and Section 3.2, SAVs can increase road safety, improve traffic efficiency, and provide services with added values [23]. The benefits of SAVs reduce consumers’ bargaining power. On the other hand, the privacy and safety concerns over SAVs as discussed in Section 2.4 increase buyers’ concerns and bargaining power.

4.3. Threats of New Entrants

The threat of new entrants measures the difficulty for new companies or innovative technologies to enter the market [61]. For SAVs, the market barriers are mainly reflected in the investment costs and the development of autonomous driving technology. New entrants include automobile manufacturers, IT companies, and transport network companies. For instance, automobile manufacturers of conventional vehicles have continued to develop autonomous driving technology. They aim to innovate driving technology so that computer-based systems can take over control of vehicles from human drivers. Automobile manufacturers have already participated in developing commercial AVs. Mercedes-Benz, Audi, BMW, Volvo, Toyota, Volkswagen, Cadillac, Ford, GM, and Nissan have already tested autonomous driving systems [18]. Nissan announced that it aimed to enter revolutionary commercially viable AVs into the mass market by 2025 [65]. IT companies and transport network companies such as Apple, Waymo, Baidu, Tencent, Uber, Didi, and SoftBank have also cooperated with automakers such as Ford and General Motors to develop a ’technology mix’ to meet the requirements of developing SAVs [63]. With relatively low market entry barriers, the threats of new entrants increase, leading to fierce market competition.

4.4. Substitutes

Substitutes refer to alternative products or services that meet similar needs. If alternatives are more competitive, consumers may tend to choose those alternatives. The existence of substitutes reduces the attractiveness and profitability of SAVs. Conventional vehicles and public transport can be considered substitutes for SAVs.

Conventional vehicles obtain subjective advantages over AVs among some drivers [35]. They refuse AVs and tend to maintain their control over vehicles. A study indicated that 60% of respondents prefer to drive by themselves and refuse AVs [66]. Another survey with 1214 respondents showed that 54.2% of them were not likely to give up their private vehicles [67]. Conventional vehicles are expected to maintain their dominant role in the market for the next 30 years [68], indicating that the substitutes for AVs still play important roles in the shared mobility market. However, AVs are expected to shift user demand from private vehicles to on-demand mobility. The market share of AVs is expected to increase significantly due to the strengths discussed in Section 2.1. SAVs are estimated to reduce the total number of vehicles by 31% to 95% [35]. One SAV is also expected to replace about 1.17 to 11 conventional vehicles, considering that the SAV’s trip length is longer [69]. Thus, these findings indicate that SAVs can significantly reduce the competitiveness of many substitutes and replace the majority of them while achieving the same mobility level.

Another substitute for SAVs is public transport. On the one hand, public transport can replace SAVs in areas with well-developed public transportation, such as Hong Kong, where public transportation is highly available and can provide convenient travel. On the other hand, in areas with poor public transport availability, public transport and SAVs can complement each other. SAVs can be regarded as an extension of public transport because SAVs can provide services 24/7 and complete the first-mile and last-mile transport. In terms of space coverage, SAVs can provide better mobility service quality in urban areas compared to rural areas [70]. In Switzerland, AVs can improve accessibility in 85% of cities [71]. Hence, SAVs can also supplement public transport in terms of location and time.

4.5. Rivalry

Rivalry refers to the competitive relationship between existing competitors in deploying AVs into the shared mobility market. The intensity of competition mainly depends on the market share, number of competitors, and service differentiation. For the market share, in New York, shared mobility has accounted for 26.11% of the total taxi travel [6]. The market share of AVs in the shared mobility market is estimated to be less than 50% in the next 10–15 years [72]. Hence, competitors need to compete fiercely for limited market share. For the number of competitors, as discussed in Section 4.3, automobile manufacturers, IT companies, and transportation network companies are major competitors, showing intensified competition. Service differentiation is mainly reflected in developing autonomous driving technology. There has been a technology race involving major technology companies and automobile manufacturers to develop commercial AVs for decades, resulting in billions of USD in investment every year. For instance, Ford has invested in four technological companies to strengthen the development of AVs. In 2016, Ford doubled its Palo Alto campus and tripled its AV testing fleets, showing strong ambition in implementing AVs [73]. Hence, the competition in developing autonomous driving technology also reflects the fierce rivalry of SAVs.

Based on the above discussion, Figure 3 presents the main findings obtained from the analysis using Porter’s Five Forces.

5. Managerial Implications

After critically analyzing the impact of SAVs through SWOT analysis, PESTLE analysis, and Porter’s Five Forces, we can develop comprehensive market insights. Hence, managerial implications are proposed for relevant stakeholders of SAVs, including automobile manufacturers, third-party shared mobility service providers, and governments. To improve the effectiveness of our implications, we evaluate the suggestions quantitatively and prioritize them according to their influence on the incremental market potential for AVs in offering shared mobility services.

5.1. Automobile Manufacturers

For automobile manufacturers, the following suggestions are proposed. First, developing autonomous driving technology is of high importance and stands as the top priority for automobile manufacturers. As discussed in Section 4.2 and Section 4.3, technological advancements can enhance competitiveness, reduce consumers’ bargaining power, and increase barriers for new entrants. A comprehensive four-stage exploratory Delphi study involving 40 global experts showed that technological factors, particularly the advancements in autonomous driving technology, held the highest priority in affecting shared mobility services provided by AVs [74]. Furthermore, a survey that was conducted in Poland revealed that a majority of the 579 participants expected the realization of full autonomous driving in the next 20 years [75]. This reflects consumers’ expectations for the fast development of autonomous driving technology. Hence, developing autonomous driving technology directly addresses market demands for advanced autonomous capabilities and has the highest priority for automobile manufacturers.

Second, automobile manufacturers should pay high attention to complying with regulatory policies at both local and national levels, ranking as the second-highest priority. Section 3.5 shows that there are legal concerns regarding license, security, data privacy, and liability. A study encompassing 4886 respondents across 109 countries underscored that respondents from high-income countries were concerned about legal issues of data privacy and security. However, respondents from low-income countries had positive attitudes towards automobile manufacturers using privacy data, since they believed that this could improve the service quality of SAVs [76]. Hence, different consumer attitudes are influenced by the national levels, leading to regional disparities. Therefore, automobile manufacturers should also comply with regulations in multiple aspects, such as developing autonomous driving systems to ensure operational safety, protecting user privacy, and collecting sensor data to determine liability. By doing so, automobile manufacturers can cultivate public trust, secure essential approvals, and pave the way for applying SAVs. However, this suggestion has a lower priority than the suggestion of developing autonomous driving technology.

5.2. Third-Party Shared Mobility Service Providers

For third-party shared mobility service providers, the following recommendations are given. First, it is suggested to filter for areas with proper external environments that are more suitable for promoting SAVs, marking this as the topmost priority. Specifically, Section 2 shows that factors such as the local economic level, employment rate, social lifestyle, and demographic structures should be evaluated. As discussed in Section 3.2, areas with low economic levels and specific industrial structures of IT, entertainment, and beverage industries can be selected to better promote SAVs. Drawing insights from a study involving 40 global experts, economic incentives aimed at attracting third-party service providers through providing business opportunities ranked high in priority among other influencing factors for promoting SAVs [74]. Hence, selecting a conducive external environment plays a pivotal role in promoting SAVs.

The second suggestion is to continuously improve user experience, ranking as the second-highest priority. As mentioned in Section 2.1 and Section 4.2, enhancing user experience can improve service providers’ competitiveness and reduce buyers’ bargaining power. Value-added shared mobility services can be provided, such as entertainment and beverage services in AVs. Consumer demand is regarded as an important driver of SAVs [74]. A study leveraging questionnaire data from 669 Chinese consumers revealed that external factors of political support and social environment, alongside internal factors of personal preferences, collectively promoted the adoption of SAVs. In particular, the external environment exerted a more pronounced impact on consumer inclinations towards SAVs than internal factors [77]. Therefore, prioritizing the selection of a conducive external environment for SAV promotion over enhancing individual experiences, which is ranked as the second-highest priority, is recommended.

Third, optimizing pricing strategies for promoting SAVs is recommended, ranking as the lowest priority. Service providers should analyze the impact of the macro environment on the shared mobility market to optimize pricing strategies. One study collected 579 valid questionnaire responses in Poland, revealing that just 20% of participants regarded cost as a barrier [75]. Similarly, another study highlighted that only 22% of 4889 respondents across 109 nations displayed reluctance to pay for SAV services. Notably, respondents had a higher inclination towards paying for fully automated driving services [76]. Therefore, while developing optimal pricing strategies can indeed promote SAVs, it is considered the lowest priority due to its relatively lower impact compared to other, more influential suggestions.

5.3. Governments

For governments, the following suggestions are provided. First, governments should develop systematic and standard legal regulations for SAVs, marking this as the top priority. Legal regulations, especially in aspects of license, security, liability, and data privacy, should be formulated because they affect the operations and compliance of SAVs in practice. Legislative concerns were regarded as important challenges and were rated highly by 40 experts in one study [74]. Moreover, in a survey involving 217 transportation experts, legal regulation was considered to be the most difficult challenge for deploying AVs [78]. Hence, formulating legal regulations stands out as the top priority for governments seeking to foster the use of SAVs.

Second, governments should provide a stable political environment and support for promoting AVs in the shared mobility market, marking this as the second-highest priority. As discussed in Section 2, sustainable use of SAVs should gain strong and stable political commitment from local and national authorities. Drawing insights from the questionnaire analysis from 669 Chinese consumers, the study emphasized the criticality of developing legal frameworks for the commercialization of SAVs. It also showed that offering political support through social norms and media publicity exhibited comparatively fewer impacts in comparison to legal advancements [77]. Hence, providing a stable political environment and consistent support is regarded as the second-highest priority for governments.

Third, governments should promote the integration between SAVs and public transport, ranking as the lowest priority. Specifically, SAVs can be deployed outside of public transport operating times and locations. It can form a more sustainable traffic paradigm, which helps increase accessibility and reduce transportation costs [79]. According to a four-stage Delphi study involving 40 international experts, political factors for providing public convenience and urbanization ranked the lowest, because facilitating mobility for individuals facing existing constraints only generated limited revenues and benefits [74]. Hence, the integration of SAVs with public transport networks is relatively less urgent on the priority scale.

Figure 4 summarizes the implications for stakeholders for applying AVs in the shared mobility market.

6. Conclusions

In conclusion, this study adopts the combination of SWOT analysis, PESTLE analysis, and Porter’s Five Forces to investigate the market potential of deploying AVs in the shared mobility market. SAVs can provide improved shared mobility services by increasing transportation safety, enhancing traffic efficiency, reducing emissions, reducing travel costs, promoting travel equality, and bringing economic benefits. However, the current use of AVs is still restricted. There are still many limitations that impede the wide deployment of AVs, including technological limitations, high initial investment costs, lack of unified policies and regulations, lack of public communication infrastructure construction, and public concerns about SAVs’ transport safety, data privacy, and cybersecurity.

Hence, implications are provided for stakeholders of SAVs, including automobile manufacturers, third-party shared mobility service providers, and governments. To maintain competitive advantages, automobile manufacturers should keep developing autonomous driving technology and follow political regulations. Third-party shared mobility service providers should filter promotion areas, improve user experience and develop proper pricing strategies. Governments need to propose standard and unified legal regulations, provide a stable political environment and strong policy support for AVs in the shared mobility market, and integrate SAVs with public transport.

For future research, adopting quantitative analysis to analyze the impact of applying AVs in the shared mobility market is suggested. For instance, the key factors of SAVs can be abstracted and their impact analyzed through modeling. Predicting the market penetration rate of AVs is also suggested because different levels of market penetration will greatly affect the performance of SAVs. In addition, predicting the size and growth of the future shared mobility market can also help evaluate the potential opportunities and competitiveness of SAVs. It is also suggested that optimal pricing strategies and profit models be developed to guide the future development of AVs in the shared mobility industry.