[matthewdgreen]

What value is the owner providing here? For traditional cabs they're doing (1) driving, (2) customer acquisition, (3) maintenance, (4) capital provision. For Uber/Lyft the customer acquisition is centralized, but they're still doing 1, 3, 4. For a Waymo-like service the owner is basically just investing cash and doing occasional cleaning/maintenance work.

Is capital so scarce that this is needed for services to operate? And is decentralized maintenance/cleaning really going to be more economical than centralized operations that benefit from economies of scale?

[buu700]

In my mind, it would be controlling both pricing and geographic allocation of resources in a market-driven way. The idea is to be a strategy for efficiently rolling out the service at scale in a way that distributes the risks and profits, like how Uber and Lyft grew by outsourcing to independent drivers rather than buying a bunch of cars and hiring a bunch of drivers in particular locations.

I don't know how the numbers work out, but if the parent commenter is correct that hardware costs are going to be a bottleneck, it seems reasonable to me that essentially crowdfunding a global deployment would be a way to address that. It could accelerate the rollout and provide economies of scale more quickly than Waymo alone footing the bill, and wouldn't preclude them from still additionally investing their own capital.

Aside from that, it seems like there would be some demand for ownership of autonomous vehicles from people who either don't want to rent them out or only want to do so part-time, and selling the vehicles directly to tap into that would help further increase the scale of both production and robotaxiing.

[matthewdgreen]

My hypothesis is that in the early days the key to success for robotaxi service companies is going to be safety and consistency, in order to convince regulators that huge fleets of robotaxis are safe. "Early days" doesn't just mean the current technical workup period -- it also covers the time period where robotaxi services start to eat into the market for privately-owned cars. That's the point where you'll see the heaviest anti-robotaxi lobbying from entrenched competitors, which will include not just taxi services but also politically-connected interests like car dealerships, manufacturers, service centers, etc. These folks will see their entire livelihood disappearing, and "robotaxis aren't safe" is the obvious argument they'll turn to.

During this period, it seems like a huge risk for a robotaxi company to play it "fast and loose" with car quality or maintenance. You'd want to maintain exceptional standards on anything safety-critical, and that means you don't want to be seen as outsourcing critical hardware purchases and maintenance to random sole-proprietor businesses. (Maybe somewhere down the line this will change, when the tech is so advanced and accepted that anyone can offer it.)

Obviously I might be wrong. Maybe capital is going to become so tight that it'll be hard for the Waymos of the world to scale up quickly? But at least for the first, say, 7 years of major expansion it feels like safety and quality are going to dominate the conversation.

[buu700]

That makes sense, I could definitely see things play out that way too.