Abstract:The automation of urban freeways is intended to reduce travel time costs, reduce direct (distance) costs, improve the safety of travel, create smoother vehicle operation, increase freeway lane capacity, and improve the comfort of travelers. This study performs a financial analysis of the first four of these effects of automation on present urban travelers by estimating the financial costs of automating vehicles (net of the savings on fuel and insurance), and calculating the break-even values for the speed increases needed to offset these costs. The analysis shows that automation will benefit heavy trucks and buses. Automation will also be cost-effective for auto commuters if large, but plausible, freeway speed increases can be obtained. Automation in the future (when nonautomated freeway speeds will be lower) will be beneficial for more users, since the break-even speed increases will be lower than their present values. The results of this analysis are very sensitive to assumptions regarding the cost of the automation devices and the changes in annual insurance payments.