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On a per mile basis they might not be expensive per car. Hertz and Uber struggle because of competition, not business model. If Waymo is the only self driving

On a per mile basis they might not be expensive per car. Hertz and Uber struggle because of competition, not business model. If Waymo is the only self driving player and hence lowest cost mode of transportation, they'll make a fortune. If there are several players, they won't.

mechagodzilla 4y ago
They have plenty of competition though - if Waymo is operating a taxi service, they are explicitly competing with Uber/Lyft/traditional taxis/bikes/buses/all the other ways to move around - generally pretty low-margin businesses where their competitors set a pretty strict ceiling on the price you can charge (who would pay a lot more for a waymo ride vs a competitor? maybe some, but not many). Waymo would have high capital costs for the cars, plus still need centralized service infrastructure (re-fueling, re-charging, who cleans a waymo when a drunk person throws up in it?). It would also still have the same problem other companies have - lots of people might want to travel to/from work, and on weekend evenings (or to big events), but not much the rest of the time. An uber vehicle might serve double duty as a personal vehicle during off-peak times (where the driver might even have a different job), but a waymo car needs to pay for itself, so it needs to be driving a lot. I could see them licensing their software to other companies like android auto or something, but that also doesn't seem like a way to print money (how much does android auto earn for google?). It just seems like a very hard business to transition from 'fun software project' to 'clearly profitable independent business.'
- danielmarkbruce 4y ago
  Agree with most of what you are saying, except that the driver is a big enough component of the cost structure that they should be able to price something like 20% below services that require a car. I just took a $65 uber yesterday which took I think 42 mins. Assuming the driver cost $15/hr and is running at 75%(??) capacity, the labor cost baked into my ride was around $15. If Waymo offered the same ride at $55 (ie leave $5 on the table for some of the issues you highlight), Uber etc are in a lot of trouble.

mechagodzilla 4y ago

They have plenty of competition though - if Waymo is operating a taxi service, they are explicitly competing with Uber/Lyft/traditional taxis/bikes/buses/all the other ways to move around - generally pretty low-margin businesses where their competitors set a pretty strict ceiling on the price you can charge (who would pay a lot more for a waymo ride vs a competitor? maybe some, but not many). Waymo would have high capital costs for the cars, plus still need centralized service infrastructure (re-fueling, re-charging, who cleans a waymo when a drunk person throws up in it?). It would also still have the same problem other companies have - lots of people might want to travel to/from work, and on weekend evenings (or to big events), but not much the rest of the time. An uber vehicle might serve double duty as a personal vehicle during off-peak times (where the driver might even have a different job), but a waymo car needs to pay for itself, so it needs to be driving a lot. I could see them licensing their software to other companies like android auto or something, but that also doesn't seem like a way to print money (how much does android auto earn for google?). It just seems like a very hard business to transition from 'fun software project' to 'clearly profitable independent business.'

danielmarkbruce 4y ago
Agree with most of what you are saying, except that the driver is a big enough component of the cost structure that they should be able to price something like 20% below services that require a car. I just took a $65 uber yesterday which took I think 42 mins. Assuming the driver cost $15/hr and is running at 75%(??) capacity, the labor cost baked into my ride was around $15. If Waymo offered the same ride at $55 (ie leave $5 on the table for some of the issues you highlight), Uber etc are in a lot of trouble.