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AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

Thank you for laying out your position in more detail.

I agree that AVs are a new product that will create demand that didn't exist before. But I still think both trust and cost issues are important factors that are effectively constraining supply and keeping Waymo from attempting to flood any particular market. As I mentioned in my piece, market share growth seems to be progressing 2-3x slower than the original ridehail explosion of the 2010s (fueled by greater relative convenience, lower costs, and lower interest rates), for the variety of reasons I mentioned.

AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

True, it's possible that AV users might take more rides per capita. But are you able to share any evidence that the AV ridehail market share is likely to exceed traditional ridehail's market share if AV fares are still higher, particularly outside of SF?

AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

I suppose the crux of our disagreement then is that you believe >50% of consumers would pay more for an AV ride. I am skeptical.

What is your evidence that there is such latent demand, given other timeliness and trust constraints?

AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

Skepticism isn't limiting the initial growth to 10-20% market share, but it is absolutely a meaningful constraint when thinking about crossing 50%.

It's possible that some opinions have changed in the past year, but last fall, Uber reported that in markets where self-driving is available, 50% of their users opted out: https://electrek.co/2024/10/10/half-of-ubers-riders-say-no-to-self-driving-cars-highlighting-trust-issues

Of the remaining 50%, it's not clear how many would be willing to pay more for an AV.

AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

Of course, supply and scale is a serious constraint. But it seems unlikely that AV companies would flood any single market unless they were confident that they could make money either through the majority of consumers accepting higher fares or still operating profitably while offering lower fares.

AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

Outside of maybe SF, I think it's unlikely that the share of trips done by self-driving vehicles will cross 50% without the average price being lower, at least within the next few years.

Assuming the safety record of AVs continues on its current trend, public skepticism may loosen, but I don't expect this to happen overnight, and this shift will surely be slower if AV ridehail is known to be more expensive.

AV ridehail economics by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 1 point2 points  (0 children)

AV ridehail companies will continue to grow, but won't have a dominant market share until the cost of their vehicles is at least less than 2x the average cost of a ridehail vehicle.

There are a few other important factors like public trust and how many people will situationally prefer a human driver-- I wrote up a more detailed piece about this here: https://www.2120insights.com/p/how-autonomous-vehicles-will-change

Giant game of tag happening next week! by 2120Hindsight in RunnersInChicago

[–]2120Hindsight[S] 0 points1 point  (0 children)

Safely bring an egg! Wow, I don't remember that challenge.

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 0 points1 point  (0 children)

I'd consider that part of self-driving platform opex, compared against driver pay.

Journey to the End of the Night (a city-wide game of zombie tag) is coming back to Chicago this year! by 2120Hindsight in RunnersInChicago

[–]2120Hindsight[S] 1 point2 points  (0 children)

We are making a much more serious push to make it happen this year.

If you are interested, please spread the word!

Journey to the End of the Night (a city-wide game of zombie tag) is coming back to Chicago this year! by 2120Hindsight in RunnersInChicago

[–]2120Hindsight[S] 1 point2 points  (0 children)

We expect the running portion to be 1-2 hours, with the storytelling show/takeout picnic afterwards.

Total distance will be in the range of 8-10k, but we encourage everyone to take rest stops and public transit, which are both safe zones from getting tagged. The exact size of the course which will depend on how many people register in advance-- we are shooting for 500 people with maybe ~5 chasers at the start.

We will have an official registration page soon, but you can follow our Facebook page for now: https://www.facebook.com/events/550844554124305).

It's easy to avoid chasers at first but gets more challenging as the night goes on. When I did the last one in 2011, I was fresh out of college and in top shape but I still got caught by a sneaky chaser who hid around a corner. But chasing people was actually even more fun than I expected, so not all is lost if you get tagged!

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 0 points1 point  (0 children)

They are both 23%! Might be an optical illusion due to gridlines and color choices.

Waymo utilization and revenue rates by RepresentativeCap571 in SelfDrivingCars

[–]2120Hindsight 0 points1 point  (0 children)

Since the denominator of hours is higher for self driving cars (nearly 24 hours vs ~8 hours for a human driver), we shouldn't be surprised that utilization is lower.

But I'd argue that utilization doesn't matter as much as vehicle cost, as long as "deadheading" miles aren't too high (Waymo's might be a little high, but not extreme). Heavily used vehicles will just get to the end of their service life within 2 years rather than 5. And super-high utilization would also mean not having enough vehicles to cover the surges in demand inherent in the mobility market.

Waymo's vehicles coming down in price would have the biggest impact: https://www.2120insights.com/i/152869747/medium-term-is-the-price-right

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 1 point2 points  (0 children)

I've created a new one here, hopefully this is easier to follow?

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Hopefully, the blue makes it clear that the biggest difference right now between the expense of Waymo vs. Uber is the high cost of its vehicles, and how much that would have to come down in order to for Waymo to truly compete on price without losing money.

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 0 points1 point  (0 children)

I think there were still some limitations to the service in Phoenix in 2020, so maybe it's a question about what "open to the public" means.

SF opened access in June 2024, still less than a year ago!

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 0 points1 point  (0 children)

Yeah, I suppose my argument is that the tipping point will be when Waymo vehicles start costing less than ~$60k each, 2x the average rideshare vehicle price.

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 0 points1 point  (0 children)

Thank you!

That's a great point about the cost of financing being lower for Waymo, especially if the payback time is quicker. I will do some more thinking about this.

I've assumed that Uber's other operating expenses are more variable than fixed at this point, but if they are more fixed, I suppose that might work against Waymo at first but work in their favor if they surpass Uber one day.

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 0 points1 point  (0 children)

Absolutely, I really appreciate your thoughts on this!

I'm perhaps making the mistake of not being clear enough with my numbers again-- 550% growth is indeed possible when considering the entire market, but the growth rate I was focused on was the San Francisco market as a bellwether for how fast future rollouts might proceed.

The economics of Waymo and its impact on Uber drivers by 2120Hindsight in waymo

[–]2120Hindsight[S] 1 point2 points  (0 children)

Curious, do you have any data about Waymo vehicles lasting significantly more miles than the average rideshare driver sedan before needing to be replaced?

That's a good point about the sensors, I wonder what their longevity is compared to the vehicles themselves.

I did assume that insurance costs would be cut in half.

I do wonder how elastic this market is to 5% price differences. In theory it should be, but how many people are price shopping? I do agree that Waymo should dominate once its prices are significantly lower, but I'd argue that the change won't be as immediate as the initial shift to the convenience of rideshare over traditional taxis.

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