You are on the right track. Trains go between cities, buses/metros/trams within a city. Cars (AI or not) will still exist, but their use will mostly be for people in rural areas to arrive near the next train station.
Traffic within a city is perfect for public transportation. It is dense enough with sufficient demand. Of course this doesn’t mean that robo taxis will (or should) be completely absent in the city, just that they should be the exception not the rule.