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The argument that counters this is that hailed rides will be cheaper than driving what you already have. You don't need to make a new purchase to switch. Even

The argument that counters this is that hailed rides will be cheaper than driving what you already have. You don't need to make a new purchase to switch. Even if you have a recent model sitting in the driveway, you may choose to save money by hailing a car rather than driving your own. I don't know if it'll play out like that, but the article is pretty convincing.

throwaway91111 9y ago
Hailed riding only works locally, and there's already public transit cheaper than ride hailing; if you leave your metro area at all i'd bet this assumption that ride hailing is cheaper quickly falls off. Hell, many US cities don't even have uber yet.
- function_seven 9y ago
  Where public transport exists, sure. But that's only in metro areas, and even then it's on a timetable that's less convenient than hailing a car. It also requires a bicycle or a long walk to travel from origin to departure, and from arrival to destination. Everybody will still own their car, and use it just for long-haul trips. Daily commuting to work could be cheaper in a hailed (electric) car than driving your own (gas) car.
leereeves 9y ago
Why would a car owned by someone else be cheaper than the same car owned by you? The obvious answer - dividing the cost of the car over more miles - doesn't seem right to me. Driving more miles doesn't generally increase the useful mileage lifespan of cars, it just wears them out more quickly.
- schiffern 9y ago
  The first half of the article addresses this specifically. BEVs last longer. There's plenty of other things to break of course, but when the business model includes selling mobility the incentives are aligned toward durability and reliability (versus selling cars, which incentivizes planned obsolescence). It's worth putting in that extra 5% to make the car last twice as long.
- DennisP 9y ago
  If a car can withstand very high mileage, you get the full economic benefit of those miles only if you drive them before the car loses its value from sheer chronological age. That means driving as much as a NYC taxi (70K mi/year) instead of as much as a normal car owner.
- function_seven 9y ago
  The author is comparing electric cars to gasoline powered cars. The idea is that the cost of paying to use someone else’s electric car—even with a markup added—would be less than your current gas car’s cost per mile. The per-mile cost also includes the capital outlay for the car itself. In other words, it might not make sense for you to pay $40,000 for a new electric car, but it could make sense for three people to split that, and drive each persons per-mile cost down. All of this is in reference to how fast the switch over could happen, and is why it might be much faster than any of us anticipate.
- kjksf 9y ago
  Even in the short term, an owner of a large (say 10k+) fleet of cars has a lot of opportunities to drive down cost per car that is not available to an average costumer: - a guaranteed purchase of 10k cars will get a significant discount over retail price - not paying dealer overhead - buying gas (or electricity) in bulk will be cheaper than retail price - in-house repairs and maintenance will be cheaper - a lot of people buy on credit, which is expensive. A fleet operator will be able to get cheaper funding (e.g. free by doing an IPO) and eventually fund purchases fully from profit - an average customer is influenced by marketing and therefore over-pays for non-essential items. A fleet buyer will be ruthless about maintaining best-bang-for-the-buck ratio. In the longer term fleet operator will transition fully to electric, build its own electricity generation capacity (especially in sunny states like texas or ca, where solar is really cheap), use data from past repairs to drive up reliability and durability of the cars etc.
russdill 9y ago
I don't think hailed rides can replace a daily commuter as easily as the author suggests. If everyone were to replace their daily driver by hailing a self driving EV, there would be massive surge pricing as most people would be commuting around the same time.
- kjksf 9y ago
  In such case the density would probably be large enough to efficiently match e.g. 4 people to a car. Commutes are predictable (people do the same exact trip at roughly the same time) so easy to optimize. You can therefore pack more people in the same fleet during peak times than during non-peak times. The second obvious step is to create additional fleet made from half-buses like the 12 seater for peak traffic, a better Chariot.
- jaggederest 9y ago
  It's already close to that cheap, where public transit is relatively expensive and rideshare is relatively widely used and thus cheap. As soon as you take human drivers out of the scenario it gets even cheaper, of course.
- monodeldiablo 9y ago
  Surge pricing can be flattened out by making these autonomous vehicles convertible and capacious. During peak commute load, they function as high-density passenger vehicles. During low commute load, they function as light freight vehicles -- courier services, delivery services, even mail. I could even see someone like Amazon running their own fleet of delivery vehicles and offsetting the maintenance and management costs by letting the vehicles run in "taxi mode" (with flip-up seats) during commute times. Think AWS for vans/light trucks. In such a scenario, they wouldn't even need to necessarily charge market rates to commuters. They could offer the service below cost and still make money, as their primary profit driver would be their delivery services. The sheer number of parties that stand to gain from this makes it almost inevitable, to my mind.

throwaway91111 9y ago

Hailed riding only works locally, and there's already public transit cheaper than ride hailing; if you leave your metro area at all i'd bet this assumption that ride hailing is cheaper quickly falls off. Hell, many US cities don't even have uber yet.

function_seven 9y ago
Where public transport exists, sure. But that's only in metro areas, and even then it's on a timetable that's less convenient than hailing a car. It also requires a bicycle or a long walk to travel from origin to departure, and from arrival to destination. Everybody will still own their car, and use it just for long-haul trips. Daily commuting to work could be cheaper in a hailed (electric) car than driving your own (gas) car.

leereeves 9y ago

Why would a car owned by someone else be cheaper than the same car owned by you? The obvious answer - dividing the cost of the car over more miles - doesn't seem right to me. Driving more miles doesn't generally increase the useful mileage lifespan of cars, it just wears them out more quickly.

schiffern 9y ago
The first half of the article addresses this specifically. BEVs last longer. There's plenty of other things to break of course, but when the business model includes selling mobility the incentives are aligned toward durability and reliability (versus selling cars, which incentivizes planned obsolescence). It's worth putting in that extra 5% to make the car last twice as long.
DennisP 9y ago
If a car can withstand very high mileage, you get the full economic benefit of those miles only if you drive them before the car loses its value from sheer chronological age. That means driving as much as a NYC taxi (70K mi/year) instead of as much as a normal car owner.
function_seven 9y ago
The author is comparing electric cars to gasoline powered cars. The idea is that the cost of paying to use someone else’s electric car—even with a markup added—would be less than your current gas car’s cost per mile. The per-mile cost also includes the capital outlay for the car itself. In other words, it might not make sense for you to pay $40,000 for a new electric car, but it could make sense for three people to split that, and drive each persons per-mile cost down. All of this is in reference to how fast the switch over could happen, and is why it might be much faster than any of us anticipate.
kjksf 9y ago
Even in the short term, an owner of a large (say 10k+) fleet of cars has a lot of opportunities to drive down cost per car that is not available to an average costumer: - a guaranteed purchase of 10k cars will get a significant discount over retail price - not paying dealer overhead - buying gas (or electricity) in bulk will be cheaper than retail price - in-house repairs and maintenance will be cheaper - a lot of people buy on credit, which is expensive. A fleet operator will be able to get cheaper funding (e.g. free by doing an IPO) and eventually fund purchases fully from profit - an average customer is influenced by marketing and therefore over-pays for non-essential items. A fleet buyer will be ruthless about maintaining best-bang-for-the-buck ratio. In the longer term fleet operator will transition fully to electric, build its own electricity generation capacity (especially in sunny states like texas or ca, where solar is really cheap), use data from past repairs to drive up reliability and durability of the cars etc.

russdill 9y ago

I don't think hailed rides can replace a daily commuter as easily as the author suggests. If everyone were to replace their daily driver by hailing a self driving EV, there would be massive surge pricing as most people would be commuting around the same time.

kjksf 9y ago
In such case the density would probably be large enough to efficiently match e.g. 4 people to a car. Commutes are predictable (people do the same exact trip at roughly the same time) so easy to optimize. You can therefore pack more people in the same fleet during peak times than during non-peak times. The second obvious step is to create additional fleet made from half-buses like the 12 seater for peak traffic, a better Chariot.
jaggederest 9y ago
It's already close to that cheap, where public transit is relatively expensive and rideshare is relatively widely used and thus cheap. As soon as you take human drivers out of the scenario it gets even cheaper, of course.
monodeldiablo 9y ago
Surge pricing can be flattened out by making these autonomous vehicles convertible and capacious. During peak commute load, they function as high-density passenger vehicles. During low commute load, they function as light freight vehicles -- courier services, delivery services, even mail. I could even see someone like Amazon running their own fleet of delivery vehicles and offsetting the maintenance and management costs by letting the vehicles run in "taxi mode" (with flip-up seats) during commute times. Think AWS for vans/light trucks. In such a scenario, they wouldn't even need to necessarily charge market rates to commuters. They could offer the service below cost and still make money, as their primary profit driver would be their delivery services. The sheer number of parties that stand to gain from this makes it almost inevitable, to my mind.