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The Mobile City

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The Mobile City

How self-driving cars and buses could boost Detroit’s economy Winter 2020
Cities
Technology and Innovation
Economy, finance, and budgets

Detroit hasn’t just had a tough decade, including municipal bankruptcy in 2013: with its population peaking in 1950, it has had a tough 70 years. Though many postindustrial cities suffered after World War II as jobs and workers fled to the suburbs, Detroit didn’t participate in the urban resurgence that began, for many American cities, in the 1980s and 1990s. In trying to rebuild the tax and population base needed to tackle high crime, unemployment, and other ills, a city designed around the car was at a disadvantage, compared with New York, Boston, San Francisco, Washington, and other resurgent coastal hubs. It lacked the physical density and urban amenities, such as walkability, that the growing ranks of “knowledge workers,” as well as the firms that employed them, wanted.

Now, as it tries to rebuild itself, Detroit is trying to use some of its disadvantages to enhance its not-insignificant advantages. The tech industry on both coasts has turned its attention to inventing autonomous vehicles (AVs)—driverless cars and trucks—and Detroit’s big plus is that it still knows how to build cars. And suddenly, in this new era of AV innovation, Detroit’s lack of urban density has become prized. Because today’s city offers wide-open boulevards as well as a denser downtown (both with little congestion, due to original design and to its shrunken population), driverless-tech companies can test their products without excessive risk. The AV industry is already creating jobs in Detroit. Longer-term, Detroit can harness driverless tech to refashion itself into a denser, more livable city that attracts other industries.

The Detroit region’s auto-centric economy is smaller than it was, even relatively recently. Despite federal support for the car companies during the 2008 financial crisis, about 1.8 million people work in metro Detroit, down from nearly 2 million two decades ago. Back in 2000, the region’s manufacturing industry boasted 380,000 jobs; today, just 250,000 people work in the sector. But the auto industry, though reduced, is hardly nonexistent, and, for the past decade, since Google’s Waymo started testing driverless cars in 2009, it’s been a key focus of the tech community.

Detroit is luring this more car-centered tech industry to Michigan, benefiting from its position as the auto world’s research, development, and manufacturing hub. Glenn Stevens, head of auto-related economic development at the local chamber of commerce, the Detroit Regional Chamber, says that “if you’re a mobility startup, whether you’re in Shanghai or Stuttgart, Detroit is a unique ecosystem. There’s no place on the planet . . . where there are 21 OEMs”—original equipment manufacturers, in auto-world parlance—“96 of the top 100 suppliers . . . and a culture of building things.”

May Mobility, a startup testing a driverless shuttle, chose Detroit for this reason, says company cofounder Edwin Olson, an alumnus of the traditional auto industry. “We’ve been asked a number of times why we aren’t in the Bay Area,” he explains. “But we thought about it very deliberately. . . . It’s the Motor City, it’s literally the land where all the suppliers [are] . . . all of the muscles and tendons that hold the auto industry together—that’s what we can build on.” To outfit its shuttles, May relies on local know-how to build a car suitable for conversion into an AV. On the tech side, “there’s a huge talent pool. . . . In the Bay Area, we might be startup number 3,226. Here, we are really able to hit out of our weight class in being able to attract people.”

The AV ecosystem extends throughout the region, home to three research universities adept at training graduates for the auto industry. “It’s hard to make a car,” says Greg McGuire, associate director of the University of Michigan at Ann Arbor’s MCity AV research center, about 40 minutes from downtown Detroit. Adding autonomous technology to a car makes it even more complex. To help tech firms and automakers test their AVs before they hit public streets, MCity has built an extensive simulated roadbed, which includes everything from train tracks to dummy pedestrians as obstacles.

State and local governments are helping to market Detroit’s talent pool to firms that might not think otherwise of locating in the Motor City. In late 2017, the Regional Chamber and Michigan’s Economic Development Corporation launched the PlanetM Landing Zone, a WeWork-managed co-working space. Through subsidized real estate, the Landing Zone invites companies interested in tapping in to the region’s network of auto-industry vets.

The Landing Zone has attracted 56 members, from established automotive and mobility companies such as Germany’s Bosch and San Francisco’s Lyft to startups such as Derq, a United Arab Emirates–headquartered company focused on pedestrian safety. The Landing Zone also sponsors “meet-ups” for tenants and guests to learn from one another. Auto startups can get to know bigger companies and vice versa. Bosch purchased ride-sharing startup SPLT last year, a move that the firms’ proximity at the Landing Zone facilitated.

“The professional sector is one of the only private-sector fields where Detroit boasts more jobs than it had in 2000.”

The Landing Zone isn’t in a suburban office park; it’s in downtown Detroit, off Woodward Avenue, Detroit’s densest corridor. In inviting companies to locate staff downtown, Detroit offers another attribute that the nascent tech-focused auto industry desires, besides the regional talent: a reviving urban core. Says Stevens of the city’s resurgent downtown, “People come here . . . who haven’t been here for 10 or 20 years, and they walk away with a really different perception.”

For now, Argo, a Pittsburgh-based AV startup with a multibillion-dollar investment from Ford and Volkswagen, houses its local workforce on Ford’s suburban-style Dearborn campus, about a 25-minute trip from downtown Detroit. But Ford, too, is cognizant that to attract tech workers, it must offer them a more interesting urban backdrop. To that end, it is renovating downtown Detroit’s historic train station, Michigan Central Station, as an AV work campus. The station rivals New York’s Grand Central Terminal or the now-demolished Penn Station in its grandeur, but it has been abandoned for three decades—an urban ruin. Over four years, Ford and its partners and suppliers will move 5,000 people there. Outside downtown, but still in Detroit proper, Google’s Waymo, in the fall of 2019, inaugurated what it calls the world’s first AV factory.

Detroit has no illusions that it can replace decades’ worth of lost manufacturing jobs with the fewer positions likely needed to build, operate, and maintain AVs. But hiring gains in professional, scientific, and technical services are a local bright spot. The professional sector is one of the only private-sector fields where Detroit boasts more jobs, at 208,000, than it had in 2000, at 184,000. Detroit has also gained computer-systems design jobs, with nearly 38,000, up from 33,000 two decades ago.

When it comes to AV investment, Detroit can also turn what has been a disadvantage to its favor: its overall lack of urban density. Hyper-dense and congested urban hubs like Manhattan or Los Angeles aren’t ideal for auto-tech firms, at least not in driverless systems’ current stage of development. By contrast, Detroit’s sprawling roads and its wide, not-too-busy boulevards, coupled with denser downtown areas, make it an optimal place to test, especially because of the shifting local weather conditions. Alan Hall, communications chief for Argo, said that Argo and Ford chose Detroit as one of six cities to test their driverless prototype because of its varying characteristics, including “rain, snow, and different types of road infrastructure.” Waymo, too, built its factory in Detroit in part because of its ability to test on diverse local streets.

Driverless-tech companies find the city’s uncongested boulevards ideal for testing autonomous vehicles. (DAVEL5957/ISTOCK/GETTY IMAGES)

Detroit’s long-standing approach to building cars—incremental and extensively tested improvements to an existing mass-market product—is more suitable to the driverless-tech world than is Silicon Valley’s typical move-fast-and-break-things ethos. It is, accordingly, deploying driverless tech on the streets in a prudent way. “We don’t just show up in a city and say, technically we’re allowed on roadways, according to federal rules,” says May’s Olson. The firm talks regularly with fire, police, and ambulance officials, as well as city and state regulators, “so that they always know what’s going on. They don’t want surprises.”

May programs its shuttles, staffed by a human attendant, to err on the side of caution. The shuttles will never make aggressive moves or run red lights, for example, and they will stop and allow the technician to take over if there is any confusion about a pedestrian’s path. Argo, too, incorporates redundancies into the testing that it does on Detroit’s streets. “The perception is that we cross our fingers,” says Hall. “That’s not how it works.” Two trained technicians sit in each vehicle, one to look at a digital map and one to watch the road; the workers follow protocols for “disengagements,” or manual takeovers, where the tech is not ready.

And the tech often is not ready. Because of their deep understanding of cars—something Silicon Valley and Boston don’t have—the auto industry and local officials recognize that driverless technology’s conquest of the nation’s roads is not imminent. AV faces significant roadblocks on its way to a mass market, including power supply: uploading and processing the data required to drive the cars consumes lots of energy. A major challenge for the computer tech, observes Olson, is how to manage the shuttles “without a team of PhDs” on hand for every problem that arises. High costs and slow progress mean that people won’t be buying their own personal-use AVs anytime soon.

But driverless technology may be able to help with one of Detroit’s urban challenges—mass transit—sooner. Detroit can use AV to support and enhance public-sector transit, just as it can use AV to add private-sector jobs. The two are ultimately intertwined: without mass transit, Detroit cannot become dense enough to support the foot traffic, cultural amenities, and other points of “livability” that thriving cities offer their workforces.

To live in Detroit is to experience what transportation advocates call a “transit desert.” It is not impossible to take public transportation in Detroit, but it’s easy to see why anyone with another option abandons the transit system—mostly buses—for a car. The bus trip from the airport to downtown takes over an hour, nearly three times what an Uber or Lyft ride takes. Inside the city, though bus service is frequent within the main downtown corridor, trying to take a bus between downtown and the outskirts or suburbs involves long waits, often in isolated areas.

Detroit’s light rail fares little better. The city’s nearly three-year-old streetcar, the Q Line down Woodward Avenue, arrives infrequently. The nearly 40-year-old elevated-rail loop, the People Mover, an early autonomous train, is more reliable, coming every few minutes. But its cumbersome fare system (riders must have dollar bills to feed a machine, and then receive a pocketful of change back) and limited route (only 13 stops, all downtown) have kept ridership low, at just 5,000 people a day, 10 percent of capacity. It’s not uncommon to be the sole passenger on one of these trains.

Detroit wasn’t always so deprived of transit options. “Detroit did have a very robust transit system, back from the 1880s all the way through the 1940s,” observes Megan Owens, executive director of the city’s Transportation Rider Alliance, a 20-year-old advocacy group. “The old streetcar system was taken apart, like in a lot of cities,” as the car was assumed to have made it obsolete. As late as the 1950s, Detroit had 2,800 streetcars, trolleys, and buses to serve the public, but it has just 300 buses and the limited rail today.

The city once had a robust transit system, including streetcars, which largely disappeared with the rise of the automobile. (CIRCA IMAGES/BRIDGEMAN IMAGES)

Unlike New York, Boston, Chicago, Philadelphia, and other industrial-era big cities, moreover, Detroit never built an underground train system. Though these other cities also rolled back or destroyed aboveground rail, they retained their underground transit, keeping alternatives alive. After World War II, cities neglected their subways, but the rails remained there, ready for the massive reinvestment and renewal that began in the late 1970s, when cities realized that urban density and car traffic don’t mix. Wealthier cities such as Washington, D.C., San Francisco, and Los Angeles, which had never built rail systems, saw their mistake and—often backed by the federal government—invested tax dollars in new underground transit, seeking to mitigate congestion and pollution. These days, Detroit, with a population still rivaling Boston’s, is nearly alone among older cities in being practically rail-less—and less than 8 percent of the city’s population relies on its buses to get around. The car remains Motor City’s king.

Detroit’s car dependency will eventually constrain its ability to rebuild. Overall, the city is still losing population, albeit at a slower rate than over the past half-century. But Detroit’s downtown has added about 15 percent to its residential population since 2012, with about 6,000 people now living in the area. To continue to grow, the city’s core must overcome a big, car-related limit on new construction: parking. Block after block of downtown is covered by a parking lot or low-rise garage—40 percent of the area’s land, according to Detroiters for Parking Reform, an advocacy group.

Replacing this parking with higher-value land uses won’t be easy; office buildings need it for their car-using workforces. The area’s biggest property owner and manager, Bedrock, estimates that it manages 19,000 parking spaces downtown for 20 million square feet of office, residential, and retail space. Parking is “not the best use of land,” says Kevin Bopp, Bedrock’s vice president of parking and mobility. But building more offices and condos downtown without building more transit would demand yet more parking space for new residents and workers.

Detroit is already using AV to experiment with mass-transit improvements. To get commuters accustomed to taking public transportation, Bedrock has teamed with May Mobility, the driverless-shuttle startup, since mid-2018, to offer some of the shuttle’s first test customers. May’s six-passenger shuttle, which looks like a square car, slowly covers a well-defined route, transporting office tenants from a downtown garage to nearby buildings. Bedrock had been running traditional, human-driven buses on a similar route, but it saw an opportunity to use AV to provide a smaller, more frequent service. “No one waits at the curb for more than a few minutes,” says Bopp. Frequency is especially an issue at off-peak hours; few people show up to work at say, 1 PM, but when they do, having a ride swiftly available is a boon.

Most passengers don’t seem to notice, or at least care much, that the car drives itself around its slow-speed loop. The main feedback in customer surveys, Bopp says, is for the car to have enough cup holders and to play some music. For its part, May wants to make mobility a profitable business. “The longer you wait, the less happy you are,” says May’s Olson. On the other hand, too much frequency provided by a traditional public bus can be bad economics: “We’ve all seen buses that have three to five people on them, and that’s a really inefficient use of an expensive asset.”

For people who’ve never taken mass transportation, getting on a public bus is a major step—and the shuttle is just one of Bedrock’s approaches to getting people out of their automobiles. Bedrock also offers its employees access to Scoop, a carpooling startup app that matches drivers to riders; Bedrock guarantees anyone carpooling in the morning a ride home in the afternoon. Carpooling is “our feeder system” to broader mass transit, notes Bopp, pointing out that through Scoop, the company has reduced the number of employees commuting in a single-occupancy vehicle from 20.5 percent to 16.9 percent, saving 267,000 driving miles and yielding open garage spots. Over time, more carpooling, whether in an AV or a traditional human-driven vehicle, could allow Detroit to turn some of its parking lots and garages into more lucrative office buildings and apartments.

Trying to take a bus from downtown Detroit to the outskirts or suburbs involves long waits, often in isolated areas. (CARLOS OSORIO/AP PHOTO)

Detroit is also trying to bolster its traditional bus system. As optimistic as they are about driverless tech, city leaders know that old-fashioned mass transit remains essential to the city’s future. “All too often, people think that ‘new mobility’ is going to fix all of it,” says Owens. “You don’t need to fund bus service anymore; everyone can just ride an Uber.” Every day, nearly 100,000 residents rely on the bus. Detroit’s bus service supports its lower-income workforce. In a city with a 35 percent poverty rate and a workforce-participation rate of 53 percent—the lowest nationwide—giving would-be workers access to jobs without requiring them to purchase and maintain a car is critical.

Though limited by lack of funds, the city’s department of transportation and the regional bus system have committed to providing service every 15 minutes on five major bus routes. Detroit is also making low-tech transit investments, such as improving bus shelters to make waiting for the bus more pleasant. Bedrock subsidizes its own employees’ public bus and Q Line passes, now up to 300 per month. “If we can get people to take one ride on DDOT or SMART,” Detroit’s two bus systems, Bopp observes, and they have a good experience, they might start taking the bus to work instead of a car. Even people taking the bus one day a week would reduce Bedrock’s need for downtown parking.

In the long term, AV could supplement bus service, increasing frequency and lowering costs. It’s easy to imagine an autonomous bus, say, that could drive people directly from the airport to downtown Detroit, skipping the dozens of local stops that make the current bus trip so grindingly slow. May-style driverless vans could operate defined routes on demand, picking up elderly and disabled riders more frequently for trips to museums, shopping, and hospitals.

Just as with Bedrock and its carpooling app, the city of Detroit isn’t waiting for autonomous technology as a panacea—incremental tech works, too. Earlier this year, the city took advantage of existing smartphone technology to enable people to pay for the bus directly on their phones, via the new DART app. It’s harder, now, to pay for a New York City bus ride than for a Detroit one. Detroit could take another low-tech step to encourage ridership on its existing AV transit system: let riders use the DART app to get on the People Mover, instead of deterring them with the current cumbersome fare arrangement.

In moving large numbers of people around quickly, nothing beats rail. Any future national infrastructure bill might help Detroit expand its modest rail lines. The city could extend its Q Line farther down Michigan Avenue, for instance, so that commuters, not only downtown residents and visitors, could use it. And the city could expand the People Mover to more outlying areas.

More private-sector workers and better transit can accelerate Detroit’s efforts to make the environment better for pedestrians. Walking around Detroit, one often feels alone. In cities such as New York, Chicago, and Boston, foot traffic starts in the mass-transit system. People who walk or take the train or bus to work are the main customers at the restaurants, bars, and clothing, book, and grocery stores at both ends of their route.

Detroit’s thousands of new auto-tech workers, if they get back and forth on transit, can bolster downtown’s foot traffic. In the past decade, Woodward Avenue, near the Landing Zone, has already attracted dozens of new tenants—from local companies like Shinola, the watch and bicycle maker, to the global fast-fashion giant H&M, which opened its first local store before Christmas. Over the past two years, the city has turned the foot of Woodward Avenue, where downtown meets the Detroit River, into a pedestrian plaza. Working with the state of Michigan, which controls many large thoroughfares, it has also installed the country’s largest continuous protected bike lane, along Jefferson Avenue.

Detroit’s bike-share program, MoGo, is doing 200,000 rides per year; Detroit residents also take advantage of the private-sector dockless-scooter companies that offer their wares on the sidewalk. On Livernois Avenue, a center of fashion, the city is shrinking a five-lane avenue down to three, using the space to construct wider sidewalks and bicycle lanes. The city is also retiming traffic lights to favor pedestrians. The efforts are directed toward improving not just quality of life but safety: Detroit’s traffic-fatality rate is six times New York’s, in part because its uncongested roads encourage high speeds.

Detroit’s autonomous-technology efforts may represent the transportation future for many cities. Though Detroit is nearly alone among industrial-age cities in lacking rail, it was a harbinger for newer, postindustrial cities. Orlando, Nashville, Houston, Phoenix, and Charlotte—the nation’s fastest-growing cities—also built themselves around the car. As such cities increasingly grapple with L.A.-style congestion without New York–style transit to alleviate it, they, too, will be looking to May-type shuttles and app-enabled bus services to get from here to there.

This article is supported by the John S. and James L. Knight Foundation.

Top Photo: May Mobility’s self-driving van is already transporting workers around downtown Detroit. (JIM WEST/ALAMY STOCK PHOTO)

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