Autonomous Vehicles

"Phoenix will no longer be Phoenix if Waymo's driverless car experiment succeeds"/MIT Technology Review

While this article is talking about Phoenix, Arizona and the effect the Waymo self driving experiment will have on a City that was designed and built to accomodate the human driven vehicle, the effects will apply to many cities around the world.

A very interesting analysis.

https://www.technologyreview.com/s/...if-waymos-driverless-car-experiment-succeeds/
 
sesevans said:
"Phoenix will no longer be Phoenix if Waymo's driverless car experiment succeeds"/MIT Technology Review

While this article is talking about Phoenix, Arizona and the effect the Waymo self driving experiment will have on a City that was designed and built to accomodate the human driven vehicle, the effects will apply to many cities around the world.

A very interesting analysis.

https://www.technologyreview.com/s/...if-waymos-driverless-car-experiment-succeeds/
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I’m still sceptical as to why autonomous cars are going to transform the world any more than taxis. Perhaps it will persuade some people out of cars for their daily commute (I take public transport like a lot of the younger generation anyway, but know that some can’t right now), but a wholesale move from owned vehicles? I’m sceptical.

A study envisioning such a fleet of vehicles at work in a simulated city based on Austin, Texas, found that running the network would cost about as much per mile as individual car ownership, and possibly less.
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Implies that there’s no monetary benefit to it then? Lose the convenience of having your own car (and being able to store your own things in it), but don’t save anything?

Ford has announced that it will sell only two models of sedan going forward, concentrating on SUVs and trucks instead. But if oil prices rise, economics and physics may conspire to push people away from SUVs and further toward a shared model.
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Oil prices are less likely to affect vehicles going forward as we move towards electrification (both PHEV and BEV). PHEV would take care of your local commutes, which would be the low hanging fruit for autonomous ride sharing and you’d only require petrol for longer haul trips, which may become uneconomic for ride sharing vehicles.

AV ride sharing may well increase the proportion of rides over taxis and Uber, just as Uber increased the proportion of people using non owned vehicles, but I don’t believe it will ever drastically change the landscape, at least in more affluent countries. That said it may reduce the outright number of vehicles each household own, perhaps the second car could be made redundant in many households?

Younger people are, in growing numbers, rejecting not just car ownership but even the once-mandatory rite of passage that is getting a driver’s license. When they do buy cars, they don’t care as much about washing, maintenance, or detailing.
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That said perhaps I don’t see such a massive change as that basically describes me. I didn’t get my driving licence until my 20s and living in cities I’ve always used public transport to get around. When I lived in London I didn’t own a vehicle, and now we own two as a family. We could drop down to one easily, but it would probably increase our car ownership costs as we would lose multi vehicle insurance while the cost of running the car is minimal, and it’s cheaper per mile than the vehicle we would keep.

Perhaps for many others it would change things?

Longer term subscription services may change things however (rather than just AV ride hailing). Things like Care by Volvo will become more prevelant, especially for those that lease vehicles already. It sort of fits under the end of car ownership banner but doesn’t have many of the negatives associated with ride hailing/sharing. You can keep you belongings in your vehicle, you aren’t “sharing” it with someone, you don’t have to worry about paying “extra” to keep it overnight. The subscription service isn't reliant on AV however. The negative is for those that don’t take out finance or lease their vehicles, it’s another monthly cost that could fast overtake the traditional cost of ownership if you keep your vehicle for more than a couple of years.

My argument is all based on the idea that, after a few years of AV in ride hailing/fleets, level 4/5 will be available at a cost effective price in cars available to the general public. If it never comes to that point then things may be different.
 
Amp34 said:
I’m still sceptical as to why autonomous cars are going to transform the world any more than taxis. Perhaps it will persuade some people out of cars for their daily commute (I take public transport like a lot of the younger generation anyway, but know that some can’t right now), but a wholesale move from owned vehicles? I’m sceptical.

Implies that there’s no monetary benefit to it then? Lose the convenience of having your own car (and being able to store your own things in it), but don’t save anything?

Oil prices are less likely to affect vehicles going forward as we move towards electrification (both PHEV and BEV). PHEV would take care of your local commutes, which would be the low hanging fruit for autonomous ride sharing and you’d only require petrol for longer haul trips, which may become uneconomic for ride sharing vehicles.

AV ride sharing may well increase the proportion of rides over taxis and Uber, just as Uber increased the proportion of people using non owned vehicles, but I don’t believe it will ever drastically change the landscape, at least in more affluent countries. That said it may reduce the outright number of vehicles each household own, perhaps the second car could be made redundant in many households?

That said perhaps I don’t see such a massive change as that basically describes me. I didn’t get my driving licence until my 20s and living in cities I’ve always used public transport to get around. When I lived in London I didn’t own a vehicle, and now we own two as a family. We could drop down to one easily, but it would probably increase our car ownership costs as we would lose multi vehicle insurance while the cost of running the car is minimal, and it’s cheaper per mile than the vehicle we would keep.

Perhaps for many others it would change things?

Longer term subscription services may change things however (rather than just AV ride hailing). Things like Care by Volvo will become more prevelant, especially for those that lease vehicles already. It sort of fits under the end of car ownership banner but doesn’t have many of the negatives associated with ride hailing/sharing. You can keep you belongings in your vehicle, you aren’t “sharing” it with someone, you don’t have to worry about paying “extra” to keep it overnight. The subscription service isn't reliant on AV however. The negative is for those that don’t take out finance or lease their vehicles, it’s another monthly cost that could fast overtake the traditional cost of ownership if you keep your vehicle for more than a couple of years.

My argument is all based on the idea that, after a few years of AV in ride hailing/fleets, level 4/5 will be available at a cost effective price in cars available to the general public. If it never comes to that point then things may be different.
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Hey Amp34, you raise some very great comments and I think that while your caution is justified based on what we know now, we are looking at a fluid situation with AVs. I have argued that the pace of change will be dictated very much by what legal, moral, social and regulatory changes either accelerate or slow down the mobile robot swarm! Unlike you however, I see the move to AVs as inevitable, my only question is how quickly it can happen. If you read the technology reports, many believe that 98-99% of the tech challenge has already been solved. But there is likely still the need for a billion miles of autonomous driving to address all "edge cases" to solve the last 1-2%.

So, for example I believe that insurance companies, who derive significant income from motor insurance they sell to each vehicle owner will be pleased to slow down the move towards this mobile robot swarm that via sensor technology, deep learning and AI should be able to reduce road traffic accidents to a very low number (vs the 1.2 million people killed annually in road traffic accidents mostly the fault of human drivers). To me, this possibility alone justifies the need for the technology.

So to your comments from the MIT article and my comments earlier:

1. The transformation will happen IMO when the tech is proven to be many times safer than the human driver and hence people will feel that there is no risk of a crash. The Uber fatality and the Tesla fatalities have set things back here.

Also the transformation will only occur if the user saves significant cost. I think the MIT research piece is too conservative on the cost advantage coming in AV vs any human operated vehicle. Swarms of these robots means that economies of scale will drive down the cost of ownership to ride hailing fleet operators. It will be a case of demand creating the need for an optimized supply. A Waymo AV for example today may cost $ 250,000 for a Chrysler Pacifica minivan manufactured on a nearly bespoke basis today for Waymo. While probably true for the first 600 vehicles delivered and operating in the US today, how low can the production cost be for the next 62,000 vehicles that Waymo has ordered from Fiat Chrysler, when scale begins to really happen? What cost reduction has Waymo made in creating a LIDAR unit, which used to cost $ 75,000 from Velodyne and is now costing Waymo less than $ 10,000, going to be later this year and next? Can this LIDAR unit cost be reduced to a few dollars? I have previously mentioned that AV "experts" suggest the cost of a human operated Uber is between $ 1.00-$ 1.25 per mile. I have read the cost can drop significantly below $ 1 per mile for a Waymo ride hailing vehicle. I do not believe that AV retail sales to individuals will happen before 2021-2022.

Swarms of these mobile robots will create their own demand as people trust them to be safe and cost effective to use. Do you think Waymo, GM Cruise, Ford Argo, etc believes this is possible? If Waymo's 20,000 Jaguar iPace AVs can generate 1 million ride hailing trips daily--because they are perceived as cheap and safe and available, think about the impact they could make on the way people think about car ownership.

You mentioned the savings a family could make, esp on not needing to purchase/lease a second car. I think the cost savings and convenience could be huge. Keep in mind the average family use of a vehicle is very low: less than 5% of the time. A ride hailing vehicle can be in use more than 60% of every day.

Amp34, you take the person out of the drivers front seat and there is a whole world of possibilities for passengers to enjoy, including the former driver. Restaurants on wheels? Movie theatres on wheels? VR and AR enhanced experiences for all passengers? Car design changes. Think even beyond passenger AVs to trucking, freight etc.
 
sesevans said:
Keep in mind the average family use of a vehicle is very low: less than 5% of the time. A ride hailing vehicle can be in use more than 60% of every day.
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I agree that a UV can be used a significantly higher % of the time and more inline with a taxi. But the demand burning peek times (7-9) (4-6) will cause the same issues as it does now leading to lots of idle cars when most family cars are also idle now, especially overnight. That will have a big effect on profitability once its starts progressing out of the taxi market and into replacing car ownership.

$1+ a mile is still way above the level needed to replace a personally owned vehicle. I do 15k a year, it would need to come down by at least 66% and even more when you take into account electrification.

Have you ever tried to get a taxi in peek rush hour times outside of a big city like London? The answer is don’t bother as they are all doing contracted school runs. The AV version of that would be serge pricing.
 
sesevans said:
Hey Amp34, you raise some very great comments and I think that while your caution is justified based on what we know now, we are looking at a fluid situation with AVs. I have argued that the pace of change will be dictated very much by what legal, moral, social and regulatory changes either accelerate or slow down the mobile robot swarm! Unlike you however, I see the move to AVs as inevitable, my only question is how quickly it can happen. If you read the technology reports, many believe that 98-99% of the tech challenge has already been solved. But there is likely still the need for a billion miles of autonomous driving to address all "edge cases" to solve the last 1-2%.

So, for example I believe that insurance companies, who derive significant income from motor insurance they sell to each vehicle owner will be pleased to slow down the move towards this mobile robot swarm that via sensor technology, deep learning and AI should be able to reduce road traffic accidents to a very low number (vs the 1.2 million people killed annually in road traffic accidents mostly the fault of human drivers). To me, this possibility alone justifies the need for the technology.

So to your comments from the MIT article and my comments earlier:

1. The transformation will happen IMO when the tech is proven to be many times safer than the human driver and hence people will feel that there is no risk of a crash. The Uber fatality and the Tesla fatalities have set things back here.

Also the transformation will only occur if the user saves significant cost. I think the MIT research piece is too conservative on the cost advantage coming in AV vs any human operated vehicle. Swarms of these robots means that economies of scale will drive down the cost of ownership to ride hailing fleet operators. It will be a case of demand creating the need for an optimized supply. A Waymo AV for example today may cost $ 250,000 for a Chrysler Pacifica minivan manufactured on a nearly bespoke basis today for Waymo. While probably true for the first 600 vehicles delivered and operating in the US today, how low can the production cost be for the next 62,000 vehicles that Waymo has ordered from Fiat Chrysler, when scale begins to really happen? What cost reduction has Waymo made in creating a LIDAR unit, which used to cost $ 75,000 from Velodyne and is now costing Waymo less than $ 10,000, going to be later this year and next? Can this LIDAR unit cost be reduced to a few dollars? I have previously mentioned that AV "experts" suggest the cost of a human operated Uber is between $ 1.00-$ 1.25 per mile. I have read the cost can drop significantly below $ 1 per mile for a Waymo ride hailing vehicle. I do not believe that AV retail sales to individuals will happen before 2021-2022.

Swarms of these mobile robots will create their own demand as people trust them to be safe and cost effective to use. Do you think Waymo, GM Cruise, Ford Argo, etc believes this is possible? If Waymo's 20,000 Jaguar iPace AVs can generate 1 million ride hailing trips daily--because they are perceived as cheap and safe and available, think about the impact they could make on the way people think about car ownership.

You mentioned the savings a family could make, esp on not needing to purchase/lease a second car. I think the cost savings and convenience could be huge. Keep in mind the average family use of a vehicle is very low: less than 5% of the time. A ride hailing vehicle can be in use more than 60% of every day.

Amp34, you take the person out of the drivers front seat and there is a whole world of possibilities for passengers to enjoy, including the former driver. Restaurants on wheels? Movie theatres on wheels? VR and AR enhanced experiences for all passengers? Car design changes. Think even beyond passenger AVs to trucking, freight etc.
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I think the issue here is that we are really talking about two different things, but attributing the benefits of one to the other. Yes, one needs the other to function, but at the same time the other doesn't necessarily need the first to function.

We have (1) Autonomous vehicles and (2) the move away from vehicle ownership.

AV technology may reduce the cost of renting a vehicle for short periods over a human driver, but it is fundamentally different from the move from vehicle ownership itself.

While AV is likely (and sensibly) going to come to fleets first, it's unlikely to stay that way for very long. Once the technology matures enough to be available in consumer products (lets say around 3-5 years after in some cases) most of the benefits you are currently attributing to ride hailing are no longer exclusive to that.

For example the benefit of not having to drive is there for both the ride hailer and the car owner, benefits such as not requiring to find a parking spot, or not needing to pop out and pick others up will be available to both ride hailers and car owners. Those are discussion points for AV, not ride hailing and car ownership.

Then there are discussion points regarding car ownership:

  • The ride hailer doesn't have to store or maintain their vehicle, but have to use it like a taxi now, removing everything they own from it, not knowing what the condition of the car will be like, potentially having to wait for a free vehicle (this will happen, even if you can schedule a vehicle unless there's a significant over supply of vehicles). They also need to deal with issues that may come up if they need to travel longer distance.
  • The car owner has to store it (on the road in front of their house, or the drive, or a garage, or a car park somewhere relatively nearby) and maintain it, but don't have to worry about removing all their belongings, or what the condition of the car is like, or whether one will be available. With parking especially, AV reduces that "issue" as the vehicle can drop you off at your front door/destination and head off and park on its own.
  • AV does not preclude companies from offering restaurants on wheels (we have food trucks and delivery services already), or cinemas, or VR/AR (why can we have video screens in cars for passengers now, but not AR/VR for example?). The cost of a driver in those circumstances are either already included (the food trucks and delivery) or would be relatively negligible relative to the cost of the vehicle and the profit it may be able to make (what vehicle do you need for a mobile restaurant or cinema, an HGV at least? A Mobile restaurant would likely need a chef and waiter at the very least anyway).

These are all unrelated to AV technology. Ride hailing is available now, you can rent a car for a long weekend trip away now (and many do).

The only real thing that ties these two factors (AV and ride hailing/car ownership) is cost. If the cost of ride hailing falls low enough that it negates the negatives people have with not owning their own car then people will transition. That cost/benefit ratio will vary significantly from person to person. For example, even if we halved the cost of ride hailing with AV I probably still wouldn't use it. It would still be cheaper to take the train for my commute, and I would still value the benefit of my own car to pick up shopping, or do other errands, over hailing potentially multiple vehicles for the same situation. I don't think I'm alone in that sentiment. That's now, when the choice is to drive, or get someone else to drive for you. In the future when I wouldn't have to drive either way (both owned and hailed vehicles being AV) then one of the current major benefits of hailing is not there any more.

All that said I don't think AV ride hailing is a bad thing. It will almost certainly be beneficial and make a significant profit for the companies involved. There's already a large market served by taxis and ride hailing which will likely transition over to AV services, just as other driving jobs will (hauling etc). That market will probably increase a bit, as mentioned before perhaps by removing the need for a second vehicle in some families, but there's no reason AV alone will change the face of car ownership. What will is societal changes, which are largely unrelated to AV now.
 
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Amp34 said:
I think the issue here is that we are really talking about two different things, but attributing the benefits of one to the other. Yes, one needs the other to function, but at the same time the other doesn't necessarily need the first to function.

We have (1) Autonomous vehicles and (2) the move away from vehicle ownership.

AV technology may reduce the cost of renting a vehicle for short periods over a human driver, but it is fundamentally different from the move from vehicle ownership itself.

While AV is likely (and sensibly) going to come to fleets first, it's unlikely to stay that way for very long. Once the technology matures enough to be available in consumer products (lets say around 3-5 years after in some cases) most of the benefits you are currently attributing to ride hailing are no longer exclusive to that.

For example the benefit of not having to drive is there for both the ride hailer and the car owner, benefits such as not requiring to find a parking spot, or not needing to pop out and pick others up will be available to both ride hailers and car owners. Those are discussion points for AV, not ride hailing and car ownership.

Then there are discussion points regarding car ownership:

  • The ride hailer doesn't have to store or maintain their vehicle, but have to use it like a taxi now, removing everything they own from it, not knowing what the condition of the car will be like, potentially having to wait for a free vehicle (this will happen, even if you can schedule a vehicle unless there's a significant over supply of vehicles). They also need to deal with issues that may come up if they need to travel longer distance.
  • The car owner has to store it (on the road in front of their house, or the drive, or a garage, or a car park somewhere relatively nearby) and maintain it, but don't have to worry about removing all their belongings, or what the condition of the car is like, or whether one will be available. With parking especially, AV reduces that "issue" as the vehicle can drop you off at your front door/destination and head off and park on its own.
  • AV does not preclude companies from offering restaurants on wheels (we have food trucks and delivery services already), or cinemas, or VR/AR (why can we have video screens in cars for passengers now, but not AR/VR for example?). The cost of a driver in those circumstances are either already included (the food trucks and delivery) or would be relatively negligible relative to the cost of the vehicle and the profit it may be able to make (what vehicle do you need for a mobile restaurant or cinema, an HGV at least? A Mobile restaurant would likely need a chef and waiter at the very least anyway).

These are all unrelated to AV technology. Ride hailing is available now, you can rent a car for a long weekend trip away now (and many do).

The only real thing that ties these two factors (AV and ride hailing/car ownership) is cost. If the cost of ride hailing falls low enough that it negates the negatives people have with not owning their own car then people will transition. That cost/benefit ratio will vary significantly from person to person. For example, even if we halved the cost of ride hailing with AV I probably still wouldn't use it. It would still be cheaper to take the train for my commute, and I would still value the benefit of my own car to pick up shopping, or do other errands, over hailing potentially multiple vehicles for the same situation. I don't think I'm alone in that sentiment. That's now, when the choice is to drive, or get someone else to drive for you. In the future when I wouldn't have to drive either way (both owned and hailed vehicles being AV) then one of the current major benefits of hailing is not there any more.

All that said I don't think AV ride hailing is a bad thing. It will almost certainly be beneficial and make a significant profit for the companies involved. There's already a large market served by taxis and ride hailing which will likely transition over to AV services, just as other driving jobs will (hauling etc). That market will probably increase a bit, as mentioned before perhaps by removing the need for a second vehicle in some families, but there's no reason AV alone will change the face of car ownership. What will is societal changes, which are largely unrelated to AV now.
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Will think about a longer response but note that Kroger, the US supermarket chain has decided to use AVs to deliver groceries this year (talking about use cases other than ride hailing). They are working with some ex-Google engineers who formed Nuro.

https://arstechnica.com/cars/2018/0...es-to-deliver-groceries-this-fall/?comments=1
 
sesevans said:
Will think about a longer response but note that Kroger, the US supermarket chain has decided to use AVs to deliver groceries this year (talking about use cases other than ride hailing). They are working with some ex-Google engineers who formed Nuro.

https://arstechnica.com/cars/2018/0...es-to-deliver-groceries-this-fall/?comments=1
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Thinking some more about Amp34s comments about AV v car ownership:

1. We know that AV ride hailing will happen in the US city of Phoenix later this year. Waymo has stated that it is to begin a commercial ride hailing service. When it happens (I predict September at the earliest due to the extreme temperatures in Phoenix in summer), it will be covered by every journo and blogger from here to the end of the world and be front and centre in people's minds. The reality is that the service will be geo-fenced initially into 100 square miles or so around Chandler, a Phoenix suburb and be gradually expanded to wider Phoenix. By later this year Waymo will have taken delivery of many more Fiat Chrysler Pacificas than the 600 currently in their fleet and be ready with the supply. Will the demand follow? Tune in. And look out for a massive PR campaign. Already Waymo has said it plans to roll out their commercial ride hailing service to many more US cities. And yesterday Waymo's CEO said that they are planning to roll out a ride hailing AV service in Europe soon and are talking with car manufacturers about supplying vehicles for their fleets but with a different branding: ie, not Waymo but using the brand of the car manufacturer. Will this mean a partnership with Fiat Chrysler or Jaguar in Europe or someone else? Clearly Waymo believes their ride hailing service will be competitively priced with today's human driven service.

2. You list the advantages of car ownership v AV ownership in say 3-5 years and AV ride hailing in the nearer term and suggest that for you, your preferred means of transport will continue to be a train journey and a car ownership rather than significant AV ride hailing. We both agree that we are talking about an evolution in society, not a revolution. You may be typical or atypical in the next 5 years. I continue to fall back on something I have previously written about, namely that owning a car is the second largest purchase that people make in their lives (home ownership being the largest). Think of it in the abstract. If I told you that you could purchase an asset for say £ 50,000 and find it useful for perhaps 3% of your daily life, you might ask whether this is the best use of your money (leaving aside the subsidised company schemes for this discussion). You might ask if there is an alternative that rather than spend £ 50,000 up front for such an underutilized asset, you might consider. Esp if the alternative either operates in the area you typically travel (geo-fenced Chandler Arizona for the sake of discussion) or is not geo-fenced and is able to travel on any road over any distance (ie, true Level 5). And to add to your consideration I said that the alternative is markedly safer and that you will almost certainly not be at risk on the road. And if I said that you could thoroughly relax, and tune out or tune in to something entirely different than actually driving. In summary: I believe cost, convenience and safety will be the main drivers of a change in societal thinking about car ownership.

Born2sk8 mentions that AVs will be more likely to be idle outside of peak use times. But I believe that excludes the possibility that with hardware and software design, the vehicle could re-purpose themselves when not in use for ride hailing. We have talked about restaurant on wheels, theatre on wheels, entertainment on wheels before . What about ambulances on wheels or other use cases in the wee hours of the morning? And helpful robots to assist in the re-positioning of the use case? And I do assume that the AV will also need some down time for cleaning, maintenance, recharging, etc and cannot therefore be in use 100% of the time in any case. Yet despite knowing that there will be AV downtime, a number of companies are investing billions into bringing out a commercially available product or service because they believe that there will be a chance to make a significant profit and a significant contribution to society even with a vehicle in use 60% of the time.
 
sesevans said:
Born2sk8 mentions that AVs will be more likely to be idle outside of peak use times. But I believe that excludes the possibility that with hardware and software design, the vehicle could re-purpose themselves when not in use for ride hailing. We have talked about restaurant on wheels, theatre on wheels, entertainment on wheels before . What about ambulances on wheels or other use cases in the wee hours of the morning? And helpful robots to assist in the re-positioning of the use case? And I do assume that the AV will also need some down time for cleaning, maintenance, recharging, etc and cannot therefore be in use 100% of the time in any case. Yet despite knowing that there will be AV downtime, a number of companies are investing billions into bringing out a commercially available product or service because they believe that there will be a chance to make a significant profit and a significant contribution to society even with a vehicle in use 60% of the time.
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I am pretty open minded and receptive to technology and I appreciate there are lots of ideas for how to use AV's once they are more main stream but having worked in a restaurant I can safely say that I would not want to get into a car that's just been used as a mobile restaurant or even been used as a take away delivery service. No thank you. There is a reason why most taxi's don't allow food or drink.

I also think cars like the iPace are a poor representation as to what AV's will be like in the future and is solely being used to create buzz and capture the market in its infancy. It's a bit like Uber's unsustainable low prices they use to capture the taxi market. Once they are forced to stop burning through cash those sorts of vehicles will be replaced with what we expect a mainstream AV to look like. There will be a market for high end AV's but most people will end up with something more akin to a Smart car, much more efficient and cost effective to operate. £££ is what drives consumers at the end of the day.
 
b0rn2sk8 said:
I am pretty open minded and receptive to technology and I appreciate there are lots of ideas for how to use AV's once they are more main stream but having worked in a restaurant I can safely say that I would not want to get into a car that's just been used as a mobile restaurant or even been used as a take away delivery service. No thank you. There is a reason why most taxi's don't allow food or drink.

I also think cars like the iPace are a poor representation as to what AV's will be like in the future and is solely being used to create buzz and capture the market in its infancy. It's a bit like Uber's unsustainable low prices they use to capture the taxi market. Once they are forced to stop burning through cash those sorts of vehicles will be replaced with what we expect a mainstream AV to look like. There will be a market for high end AV's but most people will end up with something more akin to a Smart car, much more efficient and cost effective to operate. £££ is what drives consumers at the end of the day.
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Just putting some flesh on the bones of your argument, you may wish to keep the following in mind (reported by Quartz in Feb 2018):

"Driverless cars are widely believed to be the silver bullet that will make ride-hailing profitable by eliminating the main cost: wages paid to human drivers. In the fourth quarter of 2017, Uber paid about $8 billionto drivers in earnings and bonuses, or about 72% of its gross revenue for the quarter. Uber lost $4.5 billion last year on $37 billion in gross revenue."

If 72% of its gross revenue continues to be allocated to driver earnings and bonuses, it underscores how valuable it will be to remove the human driver for reaching profitability. Yes the vehicle currently costs much more than an Uber vehicle, but I suggest that economies of scale and tech advances in areas such as sensors and cameras and LIDAR will dramatically reduce the AV cost. As you may have read above, Waymo for example says it needs to order a huge number of AVs to operate a ride hailing service it plans to launch in Europe. Their fleet is starting to expand to some serious numbers: more than 62,000 Fiat Chrysler Pacifica minivans (including the 600 they currently operate), 20,000 Jaguar iPace AVs over a 2 year delivery period and now a huge number of additional vehicles it is negotiating to purchase in Europe. I believe we should soon see some serious economies of scale kicking in to to reduce substantially their vehicle purchase cost.

A further constraint on Uber reaching profitability on its current human driver model has been the pressure put upon them by a number of regulators to start to pay their drivers for sick pay and healthcare insurance.

Point noted about smelly vehicles that serve food! There have been persistent rumours for the past two years that Waymo and Honda have been in discussion about a different kind of vehicle. I can only speculate what form that might take.
 
Uber now expects to re-start its self driving vehicle programme in Pittsburgh in August. Perhaps also soon after in California but probably not in Arizona. Uber will have to accept restrictions in Pittsburgh including limiting its speeds to 25 mph, etc.

What I found interesting is that in this link from CNET there is some reference about discussions that Uber has been having with GM Lyft for the past 18 months. No mention of any updates on their previously mentioned discussions with Waymo (have those stopped?). Yet Waymo's parent, Google, holds an equity stake in Uber.

https://www.cnet.com/roadshow/news/uber-self-driving-program-restart-august-report/
 
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Carlos Ghosn of the Renault Mitsubishi Alliance says:
"
Some experts believe that the development of automated taxis will accelerate this process, and that the days of personal car ownership are numbered, at least in cities.

That would clearly threaten car manufacturers, because the market for new cars would shrink. But it is an idea that the boss of Nissan and Renault gives short shrift.

"I don't believe in this. In China you still have one car for five people, in Indonesia it's one car for 50 people, in India one car for 20 people. So we are far from saturated in terms of ownership of cars."

Meanwhile, he says, building systems designed for the sharing economy will provide new avenues for growth.

"Ownership of cars will continue. Maybe it'll be limited in mature markets to the benefit of shared mobility services. But we're going to be involved in both sides."

On this thread there are many who believe that the shared autonomous vehicle will co-exist with traditional car ownership for many years.

https://www.bbc.co.uk/news/business-44662649
 
@Amp34 and @BOrn2Sk8

In support of Amp34's comments recently, I found this interesting recent research note from a portfolio manager of Schroder Investments UK and their basic conclusion is that Uber and ride hailing have so far not been killing or even denting much the car purchase business of the OEMs.

As to the strength of the ride hailing market: "Since 2013, Uber and Lyft combined have grown revenues almost 80x. Uber is now present in over 600 cities, has 75 million passengers, and completed over 4 billion trips in 2017. For Lyft the figures are 65 cities, 23 million riders and 375 million trips. Various surveys have found that around one-fifth of US consumers used ride-hailing services in 2016, and it seems obvious that this figure has only risen since."

Of note ride sharing still accounts for less than 1% of total miles travelled in the US.

As to car ownership: "Consumers haven’t stopped buying cars. US car sales have been stagnant for the last couple of years, but remain at a very high level of over 17 million per year; at or above pre-crisis highs. After peaking in 2011-12 – around the time that ride-hailing services really took off – the number of households with no car or only one car per family has declined, while the numbers of households with two or more cars has accelerated."

"The UC Davis’s survey focuses just on metropolitan areas, but still found that less than 10% of people reduced their car ownership after starting to use ride-hailing services."

So who is feeling the pain from the growth of ride sharing?
"
The evidence so far suggests that ride-sharing has mostly substituted for regular taxis, rental cars, public transport and walking, rather than private vehicle use.

In New York, taxi rides have fallen 30% in the last 3 years and the price of prized yellow taxi medallions has plummeted from a peak of $1 million in 2013 to less than $200,000 in recent auctions. In fact, the tightness of the licensed taxi market is a key reason for Uber’s success in cities such as New York, San Francisco and London. It is no surprise that taxi drivers in these markets have lobbied aggressively against ride-hailing operators."

Amp34 believes that AV ride hailing will also not affect the car ownership model to any great extent. These numbers for non-AV ride hailing suggest he is right. Will he be right in the future?

http://www.schroders.com/en/uk/priv...tent&utm_source=Dianomi&utm_term=Content_Link
 
That study makes sense for what is happening now.

I don't have any data but I think where Uber and Lyft are really making a killing is from tourists (national and international). You can use the app in your own language and not risk getting scammed by some cabbies taking the mick out of of someone that doesn't know any better. You also don't need to learn the local public transit network and its likely to be cheaper if there is more than one of you.

I wouldn't think twice about using Uber in Central London but I would never use it in my local town.
 
b0rn2sk8 said:
That study makes sense for what is happening now.

I don't have any data but I think where Uber and Lyft are really making a killing is from tourists (national and international). You can use the app in your own language and not risk getting scammed by some cabbies taking the mick out of of someone that doesn't know any better. You also don't need to learn the local public transit network and its likely to be cheaper if there is more than one of you.

I wouldn't think twice about using Uber in Central London but I would never use it in my local town.
Click to expand...

Interesting thought. Would like to see data in support of it in due course.
 
I do not believe that Juniper Research's estimate for 21 million self driving vehicles sold by 2026 (8 years from now) sounds overly aggressive. Considering that Waymo has already placed orders for up to 80,000 AVs from Fiat Chrysler and Jaguar Land Rover this year and with all the entrants in the race to provide self driving vehicles in one form or another (cars, trucks, delivery vans, etc), I see the order pace picking up steam by next year in a much bigger way. GM Cruise wants to start a ride hailing service in 2019. The Chinese entrants are also expected to ramp quickly by next year.

https://www.mediapost.com/publicati...-self-driving-vehicles-projected-by-2026.html
 
Slightly off topic but of note, there has recently been a spate of financings and heavy interest in electric scooters, esp in names like Lime and Bird. One could argue that electric scooters could be of interest to urban planners of smart cities, esp as journey extenders (ie the autonomous vehicle puts you in an area but an electric scooter gets you around during your actual stay in an area).

In this note recently from Engadget, will range extenders like electric scooters be more inclined to replace car ownership (esp in warm climates that allows electric scooters to operate all year long)?

https://www.engadget.com/2018/07/01/alphabet-invests-in-lime-electric-scooter-service/
 
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