| Factor in the cost of a driver, and the $250K price tag will look super cheap if not sensible. Right now, rideshare companies keep ~40% of the ride revenue (not including vehicle payments). Which means, 60% goes to the driver. Now if you consider operating costs (fuel/gas/insurance/tolls/oil change/maintenance) at 30% (of the total revenue), there's still the remaining 30% that the driver takes home. Even if you think the driver is working 80 hrs a week, that's not even 50% of the total number of hours an autonomous car can work (24x7 = 168 hrs a week). With a fully autonomous car, that remaining 30% and lower maintenance costs combined with lower insurance costs will mean probably close to 40% of the current ride revenue will be saved. If you operate the car for 160 hrs a week (8 hrs for fuel/maintenance) then it'll probably be ~60% of ride revenue (at current rideshare rates) that'll be pure profit. As cost to produce these cars (basically it's the separate technology package added to regular cars) goes down, they can continue to keep the service super affordable while recovering the upfront investment in the $250K car in a few years. Instead of having 10 Chrysler vans on car dealer lots/storage, have one $250K car in service a day after it is manufactured. After that maintenance costs may increase slightly, but the rest is pure profit, which creates a positive feedback loop to reduce vehicle price --> reduce final fare paid by passenger --> attract more users --> more vehicles needed --> Leads to larger scale production and reduction in price--> repeat. At some point it'll be cheaper than public transit and then owning and driving a car becomes a need only in regions / places / conditions where autonomous cars wont work. Until then, non-autonomous cars ensure good margin for autonomous cars to thrive. FWIW, I believe Uber has zero advantage with it's existing fleet. All they have is a large number of indentured drivers (due to subprime loans given to them for their cars). In fact it is a disadvantage for Uber, because as fares for ride share goes down, it starts making lesser sense to operate those cars. they'll just stop making payments and return / trash the vehicle. |