There’s a third option you’re ignoring, though- less driving, period. If we pursued public transportation as aggressively as we did car culture, we wouldn’t need self driving car cars to save 40k lives a year.
Except that that’s how the world was for a hundred years or so, post Industrial Revolution and pre-automobile and it worked just fine. In British Columbia, for example, (to choose a random example that I happen to be familiar with) there used to be an extensive rail and steamship network blanketing the province. Every tiny mining town, village, and big city alike was deeply interconnected with hourly trains and lake/river ships. All of that is gone now. There aren’t even regional busses in most places anymore. People hitchhike between towns now because that’s all they have left if they can’t afford a car.
We mustn’t lose sight of history and think that slight variations of how things are now is the only way forward.