G.M. Invests $500M in Lyft | Hacker News Reader

G.M. Invests $500M in Lyft

nytimes.com

477 pointsgk1392 comments

It is predicted that autonomous cars will reduce America's fleet of vehicles by something like 10-fold [1]. I think it will unfold something like this:

FIRST, instead three cars for mom, dad and kid, the average family has one car that drops mom off to work, then dad, and then the teen off to school.

SECOND, aforementioned car makes use of its down time to drive strangers around via Uber, Lyft, et cetera. The car's owners collect a fee from Uber, Lyft et al.

THIRD, economies of scale and changes in perceptions towards the utility versus cost of owning cars causes people to stop buying them. Instead, they subscribe for access to a fleet–such as Uber or Tesla's. (Note: people already do this in cities like New York, where car ownership is relatively scarce.)

AND FINALLY, as distributed car ownership falls, retail locations for their maintenance go out of business. Barring massive public subsidy for car ownership, this creates a feedback loop that increases the cost of individual car ownership until it becomes a luxury.

1 will happen later than we expect. 2 will happen sooner, 3 much later and 4 drastically sooner. In fact, I think it will ultimately be 4, not 3, that drives a rapid, self-perpetuating dominance of self-driving cars within our lifetime.

[1] http://sustainablemobility.ei.columbia.edu/files/2012/12/Tra...

>(Note: people already do this in cities like New York, where car ownership is relatively scarce.)

Car ownership is 45% in NYC. Not sure why this is considered "scarce" :)

Relative to other areas, it seems scarce to me.

When something is scarce, this implies there is scarcity, or inability to meet demand. Colloquially, "scarce" is used synonymously with "rare", but rare isn't a good word choice for something occurring 50% of the time.

...because in most of the country each household tends to own more than one care? Are you kidding me?

It's probably also worth noting that a lot of the time when people say "NYC," they really mean Manhattan--and, more specifically, they're really thinking Manhattan below 110th Street or so. I imagine the number is significantly lower if you remove the other boroughs.

Not even all of the other boroughs, either. Eastern Queens and Staten Island basically require a car, and so those two counties have much higher rates of vehicle ownership than the rest of the city. Brooklyn, Western Queens, and the Bronx are much, much more friendly to people who don't want to drive (like me)

According to Wikipedia (https://en.wikipedia.org/wiki/List_of_U.S._cities_with_most_...), the jump from NYC (56% car free) to the next most car-free city (38%, Washington DC) is pretty massive.

That doesn't make car ownership scarce. It makes it low.

In Manhattan it's 23% (http://www.nycedc.com/blog-entry/new-yorkers-and-cars). This is quite scarce relative to the rest of the USA and indeed even relative to the suburban boroughs of the greater New York City metro area. For the US the last average I saw (World Bank data http://web.archive.org/web/20140209114811/http://data.worldb...) was 81%.

I should have said Manhattan. 23% is "scarce" in that, on the island, there are relatively few gas stations, parking is expensive, and getting your car serviced reasonably encumbering. It's also a four-fold reduction from the U.S. average.

How much cheaper would a driverless Lyft or taxi be? 50%? How many more people would forego driving, in Manhattan, if ridesharing were half as expensive as it is today? If half do we're at 11.5% car ownership, a 7-fold reduction from the present-day U.S. average. If 2/3 do, we get to 10-fold.

Yes, I agree with your premise here. Personal anecdote, I lived in San Francisco in the city 8 years. It was by far more economical for me to have both Zipcar and taxis (later UberX and Lyft) combined per month than to have a vehicle lease + parking costs + insurance/maintenance/gas. By far. In both $ and time.

I'm not certain that other elements of your vision work in non-metro areas.

What percentage of people live in metro areas though?

In 2010, 80.7% of Americans live in an areas with an overall population density of 2,534 people per square mile [1].

[1] http://www.reuters.com/article/usa-cities-population-idUSL2E...

> Barring massive public subsidy for car ownership

Not to be trite, but one should never underestimate the impact of lobbying from massive established corporations.

I can picture all of those things happening to some extent and still would only estimate a 3-5x reduction in fleet size. In order to get 10x, you are implicitly estimating that rush hour vehicle utilization is currently only 10%. I would estimate that rush hour utilization is in the range of 50-70%.

For 10x, you would absolutely have to do something to address peak time behavior. For example, if Mom, Dad, and Junior all have to be somewhere at the same time, you are still gonna need 3 vehicles. In aggregate, total fleet demand will be dictated by the marginal demand at the peak of rush hours.

EDIT: to add, I would still predict a massive move of car ownership toward corporations, and their primary domicile to large parking lots in outer suburbs, only to awake during rush hours. These cars will have a much lower return on investment, but probably enough to justify their costs.

How about Mom, Dad, and Junior share rides with other Moms, Dads, and Juniors who are headed in the same direction?

Yeah, but they usually don't originate from the same location. So instead of matching destination, now you have to match destination and departure location.

Yep this is how Lyft Line already works

Because that is already a possibility (carpooling is an established idea), and the critical reasons why it isn't more popular don't significantly change with automated cars. People don't want to spend their commute with random people who just happen to be going the same direction. Perhaps more important is that it creates a strict commitment to be prepared to leave on time and a reliance on others leaving on time.

> People don't want to spend their commute with random people who just happen to be going the same direction

Many, many people already do this on public transport. What we're talking about is general door-to-door public transport.

Car-pooling is awkward to arrange, particularly for short joined parts of the journey (e.g. picking someone up part way and dropping them off a little later), and it's extremely hard to arrange anything that overlaps such that the first passenger needs to get out before the last passenger (currently would involve handing over the keys to your car).

>Many, many people already do this on public transport

Total fantasy. Virtually nobody uses public transport. 5% of commuters use public transport. Relative to the car-pooling, who sees double the volume of users as public transport, 10%.

http://traveltrends.transportation.org/Documents/CA10-4.pdf

Guess that depends on where you live. In cities like NYC, or Chicago (where I live), having a car in the city is common, but the minority.

In the US, only NYC has over half of households without a vehicle [0]. Chicago has only 28% with no vehicle.

[0] http://ns.umich.edu/new/releases/21923-hitchin-a-ride-fewer-...

How many people use public transit in Europe, or Japan and Korea?

For commuting, roughly 20% in the UK or about 4 million people (26M working residents, ~80% commuters). About 50% within London.

http://www.ons.gov.uk/ons/rel/census/2011-census-analysis/di...

So what? The reason so few people use public transit across the US is very likely because it sucks at getting them door-to-door in a reasonable amount of time.

The question is: if that changes, what might people choose to do? The example of large cities like NYC at least teaches us that the American preference for solo car travel is not fixed.

Close to 20% across the UK (representing about 4 million people) and close to 50% in London (compared to 35% driving).

http://www.ons.gov.uk/ons/rel/census/2011-census-analysis/di...

These are not insignificant figures.

If you say "people don't want to do X" when millions of people in my country already do a more extreme form of X, then I think you're wrong.

Carpooling in private cars is very different from carpooling in self-driven cars. While you own the private cars, it's very reasonable to expect you not to share the ride with strangers or to occupy another's car. However, if it's a self-driven car which no one owns - it's just like public transit, but way more efficient. Instead of buying a monthly train or bus pass you just pay your self-driven car rental/lease, to be picked up door-to-door at your whim. This will happen and will bring about the 10x change.

As long as cars aren't prohibitively expensive and remain symbols of personal freedom and identity, then people will pay for the luxury of not riding in public transportation.

People pay to use trains when the journey time compared to a car is marginal, since they can do something productive on the train.

Some people pay more to use a first-class compartment.

Some people have an aversion to riding on public transit when it is used by people large income/wealth disparities, i.e. the professional doesn't want to be on the same bus as the indigent person.

Those people might use a vehicle subscription, because the cost of private rides would still be lower than the costs of private vehicle ownership (depreciation, maintenance, insurance). Many people would pay for the privilege of a private ride (like they do with Uber/Lyft now).

If car subscriptions services succeed and are nearly ubiquitous, the personal-freedom symbolism of car ownership will degrade.

Then, if people want to own a car as a status symbol, they will probably be better served by a more expensive one anyway, the same way people buy other status symbols (rose-gold iPhones, etc). Ironically, most of those status-symbol cars will still have an autonomous mode.

I'm not talking about cars as status symbols, but as factors of identity. Teenagers want cars because it is a rite of passage. Half my coworkers want trucks because they are 'outdoors' people. And some do use it as a monetary status symbol. Some people are just car people who have strong opinions about the car they drive because it is part of their self-expression. This is a pretty big thing in American culture.

This is true with current car economics, but in a shared car economy, it will become increasingly expensive to have exclusive ownership, and people will vote with their wallets.

Shared-car design could also be drastically different. I don't want to share a Honda Accord with random people, but I wouldn't mind sharing a road-train that had private compartments for each set of passengers...

I think many people just don't want to coordinate with strangers, like a pickup time, place, etc.

This will be much smoother if you just open an app like Uber and it tells you the next pickup time for where you want to head.

You just literally described trains and buses. Don't assume the form of the vehicle remains the intimate 3-across sedan style.

Self-driving mini-vans could lie in the car / public bus & subway trade-off on high traffic commute roads.

car: high flexibility, high cost

public transport: low flexibility (last mile, connections, fixed time schedule), lower cost

self-driving vans: medium flexibility, possibly low cost.

You only need the three cars if you insist on owning the vehicle you're riding it. So if Mom, Dad and Kid all need to be somewhere different at the same time, Uber Pool could work for two of the three, or all three while the car is earning more as Uber Black (or the future equivalent). They only need their own vehicle if they want to ride together.

If Mom, Dad, and Kid need to be in different places at the same time during peak travel time, there is still a demand for 3 vehicles regardless of who owns them. The effect on total vehicle fleet is unchanged.

The better pooling effects of subscription or on-demand fleets mitigate this problem in most scenarios, but it doesn't mitigate it during peak times. Peak vehicle utilization will be what drives total vehicle fleet size.

Even if the members of the family are going different places, each of them can likely share a car with other people heading in the same direction (e.g. to the same school or workplace, to the same city from the suburbs, etc.)

The same capability currently exists independently of driverless cars. What makes you think the utilization of this tactic will change with driverless cars?

Coordinating this is a hassle. With driverless cars, you could say "I need a vehicle to take me from A to B" and a vehicle just shows up, possibly with one or more passengers who were already enroute to B. It wouldn't surprise me if that becomes the norm with an option for "I require a private trip" for an extra fee.

I currently have two apps on my phone that provide me a way of saying "I need a vehicle to take me from A to B". Both have attempted to do what you are talking about, but have settled on something more similar to "Walk to checkpoint A and wait for 5 minutes and you'll be dropped off at checkpoint B that is kinda close to where you actually want to go".

As it turns out, coordinating rides is pretty difficult, even with sophisticated software doing a lot of the work for you. Maybe if either of those companies had huge market shares, then maybe the problem gets easier. I'm not counting on it.

Uber and Lyft already do this in San Francisco, and it works very well.

Not sure where you live but I agree with shoyer that Lyft Line and Uber Pool serve this functionality very well in San Francisco, New York, and presumably also the other major metros where they've launched it (Austin, Boston, Chicago, Los Angeles, and Washington, D.C for Lyft Line)

Taxis are expensive and public transport isn't as convenient. A minibus taking me from within a block of my house to within a block of my work would get my business.

Labour costs are a significant part of any such operation, where I live at least.

> would only estimate a 3-5x reduction in fleet size

10x is admittedly bullish. I expect 4 to 7x within 20 years, i.e. 3 to 4 product cycles. But 10x is more reasonable than it seems at face value.

Let's use Manhattan to illustrate. Another HN user (wadenick) kindly provided [1] some references I'd like to point to. Car ownership across the United States stands at 81% of households [2]. In Manhattan it's 23% [3]. Manhattan has roughly fewer than 1/3 the number of cars as the rest of America. This is partly why there are only 39 gas stations in Manhattan (down from 60 in 2004) [4]. Repair shops, too, are fewer and further in between. Many are owned by taxi operators for their fleets' use only.

Uber pays 75% of its earnings to its drivers. How much cheaper could a driverless be? 50% less? How would that tilt our 23% figure? All it takes is half of Manhattan's car-owning households to switch for Manhattan to hit a 7-fold reduction in car ownership from present-day America.

Everywhere isn't Manhattan. Density matters. Less-dense locales will need to accept some combination of higher wait times, higher prices or lower rates of fleet reduction. That said, the scaling economics are nearly identical. Fleets will be cheaper than individually-owned self-driving cars because they can more efficiently use their down time. This, in turn, makes individually car ownership more expensive (by degrading retail-servicing infrastructure and supply chains). That, in turn, makes fleet usage more desirable and so on.

The degree to which this happens may vary. But at its lower bound, I'd posit 4x and at its higher bound over 10. Given that income and urban dwelling are correlated, and continue to increase in their correlation, that bodes badly for the edge-case rural families demanding high degrees of simultaneity at a price even remotely approaching what it costs to maintain a small garage of cars today.

[1] https://news.ycombinator.com/item?id=10837732

[2] http://web.archive.org/web/20140209114811/http://data.worldb...

[3] http://www.nycedc.com/blog-entry/new-yorkers-and-cars

[4] http://www.wnyc.org/story/say-goodbye-manhattans-gas-station...

"Uber pays 75% of its earnings to its drivers. How much cheaper could a driverless be? 50% less?"

Remember that from that 75% is supposed to be things like insurance policies and such, and I suspect that currently drivers aren't bothering to properly insure their cars (using it for a business rather than personal use). In a driverless car case, someone is going to have to pay for that insurance, whether the manufacturer, operator or rider, that cost is going to come from someplace, and will probably be significant. I'm not sure that you could achieve 50% savings, and maybe not even 25%.

"All it takes is half of Manhattan's car-owning households to switch for Manhattan to hit a 7-fold reduction in car ownership from present-day America." But what does that prove? Manhattan isn't a great barometer of anything. Even if they did drop to 14% or so, that's not really moving the needle much either way, is it?

> In a driverless car case, someone is going to have to pay for that insurance, whether the manufacturer, operator or rider, that cost is going to come from someplace, and will probably be significant. I'm not sure that you could achieve 50% savings, and maybe not even 25%.

The fleet provider (e.g. Uber) would surely self-insure. Insurance for self driving cars will be extraordinarily cheap (at least an order of magnitude less than driver based insurance).

I think 2 might be a bit slow as expectations towards vehicle cleanliness (in and out) and maintenance are higher for vehicles-for-hire than personal vehicles.

A few times that a customer won't be happy with "oil change needed" indicator lighting up, threading on one of the tires, some random food wrappers scattered on the floor, kid's soccer equipment forgotten in the trunk or just lack of recent car wash, and the transportation provider's rating system would squeeze this family out of network.

Aren't Uber and Lyft middle-men? Why wouldn't car companies themselves offer a subscription service for access to their cars? You don't pay more to own a BMW, but you do pay more for a BMW subscription over a Honda one. Uber would probably be a cheaper subscription service for 'used' autonomous cars.

yeah, but good luck for developing that middle-layer from scratch.

Especially from big car companies. They aren't exactly known for.... smooth software innovations.

Because of specialization. Manufacturing cars is a different core competency than running fleets.

Except Tesla is trying to do both (build the cars first, then do the ridesharing).

I see it as GM (or whoever) makes the car. Lyft (or uber, google, whoever) makes the software to call up the car, which includes a huge amount of data analysis for routing, so they are more than just a middle man. Also, GM just became a major investor and board member in Lyft, so both parties are clearly interested in partnering: http://www.latimes.com/business/technology/la-fi-tn-lyft-gm-...

And what about trucking? According to this[0] there are approximately 3.5 million professional truck drivers in the United States. I hate to go down the route of "machines are going to replace everything", but doesn't autonomous automobiles and AI based routing mean these people effectively get eliminated?

http://www.alltrucking.com/faq/truck-drivers-in-the-usa/

Given that trains require far less cognitive load to operate than a tractor trailer (sorry engineers!), and yet still require humans to operate.. I wonder if ever? I'm actually curious why trains haven't been automated at this point (in the US at least). It seems like an ideal first step (no navigational issues, retrofit some collision avoidance mechanisms, remote control, etc, and you are up and running).

I guess the train driver is an small percentage oft the cost of running a train compared to the cost of a truck driver.

My guess: train operators are probably a much lower percentage of the total cost of running a train than drivers are for trucks or cabs, removing the incentive for automation.

They are. It simply doesn't make sense to automate them away considering the amount of liability contained within a freight train traveling at high speeds down a rail corridor.

Automated trains have existed for many years, outside the US. They are still not common though, other than in airports.

I think this disaster has something to do with the hold-up on train regulations: https://en.m.wikipedia.org/wiki/Lac-M%C3%A9gantic_rail_disas...

Yup, get ready for some major changes. The people who see this coming will be well ahead of the curve.

How? I also see this change coming - but I don't feel well ahead of the curve.

Do you drive a truck for a living?

Nope.

That's a start!

>doesn't autonomous automobiles and AI based routing mean these people effectively get eliminated?

Most assuredly and it can't happen soon enough. We need to run headlong into automation, eliminating as many jobs as we can. The sooner we eliminate industries, the sooner we enter the post-labor era.

I feel that's pretty dangerous without adequate adjustments in redistribution of wealth and other sociopolitical realities. The tradition from agrarian to industrial significantly depressed labor for quite some time, so I can't imagine what a transition from labor to non-labor would do for current civilization.

Those sociopolitical realities are only conjecture to the policy makers. They are never pro-active on these issues. The only way to get there is to force their hand.

Although I agree with you, we really need to put the economic frameworks in place as well. We'll eventually get to a fully-automated society, but our current model is already under stress from our current position. Getting there is going to take some serious change.

So the time frames for these predictions are "sooner", "later", "drastically sooner" and "within our lifetime". That's nice.

You sir are well qualified to work on Wall Street.

> Instead, they subscribe for access to a fleet–such as Uber or Tesla's. (Note: people already do this in cities like New York, where car ownership is relatively scarce.)

Parsing this took me a moment - what they already do is subscribe to a fleet, and for years it has been the taxi fleet. That's shifting shape and I guess we'd both predict it will be Uber- and Tesla-like in the future (I don't know what mix of public / private ownership might look like).

Sorry, I think this is just totally disconnected from the reality of the average American who lives outside of a major urban center.

1. Mom, dad, and kid all need to go to work/school at roughly the same time. If they all have a 15-20 minute commute (well below average for many areas) and the destinations for all three aren't in the same immediate vicinity, we're right back to the family needing 2-3 cars.

2. Eh, no. Go to the mall or a shopping center parking lot and walk around looking in people's cars. The average person's car is somewhere between messy and a pigsty. IMO, this will only get worse with SDCs, since people will be able to do more eating/dressing/preparing/relaxing in their car without the need to drive. Not to mention the number of people who simply don't want random strangers using their car. Uber or Lyft would have to offer a significant fee before I would even consider it.

3. Vehicle owners are used to convenience. If I live in 20 minutes outside the city, then I probably have to wait 20-30 minutes for a ride to arrive before I even start my trip. Massively inconvenient, and not worth it.

SDCs will definitely lead to change in American society, but I have to wonder if it won't completely backfire on some of these expectations, and actually lead to American society sprawling out even more into the suburban and rural areas. WFH is becoming a viable option for more and more jobs, and longer commutes will be much more acceptable to most people when the time in their car isn't simply lost time.

> If I live in 20 minutes outside the city, then I probably have to wait 20-30 minutes for a ride to arrive before I even start my trip

Not according to studies I've seen, including the one cited in my original comment [1]. They map commute patterns, urban, suburban and rural, and take simultaneity and fleet access into account.

In Ann Arbor, Michigan a "shared fleet [was predicted to] provide almost instantaneous access [fractions of one minute] to a vehicle with a fleet of only 15% of the number of privately owned vehicles that would have been used for these trips." In a rural study conducted in Germany, maximum wait was estimated at 5 minutes with fleet capacity at around 20%.

[1] http://sustainablemobility.ei.columbia.edu/files/2012/12/Tra...

Why not link to the study you are quoting?! Would be useful :)

The simulation you linked has a population density of 25,000 people per sq mile (New York City is 27,000 per sq mi.)

It only accounts for trips internal to the city which already have low wait times with existing taxi cabs, and does not simulate the waits for trips traversing into/out of the city.

1. Ok, maybe 2 cars if the locations are in completely disparate locations, but carpooling is possible.

2. User feedback could be a useful deterrent against messing up someone else's SDC, in the same way that both drivers and passengers can leave feedback with Uber today.

3. True, but one can adapt to this.

Or maybe i'm just hopelessly optimistic... :)

I don't own a car and instead use a ZipCar-like along public transit and cycling.

My conclusion is that car sharing services are quite expensive. I can do no more than 3 or 4 short rentals a month before the cost start to resemble that of owning a used car. I do save money, but only because I drive a tiny fraction of what I drove when I did own a car.

Of course, car sharing is not as efficient as SDCs that can move around and maximize usage, but even SDCs would mostly end up parked at night and off-peak hours. Coupled with your point #4, I'm afraid it won't be long before driving the current average yearly mileage using those services become massively, prohibitively expensive.

I'm not sure how that would be a gain for anyone but the environment.

People already have the option to carpool, and rarely choose to take it. I don't really see that changing due to SDCs...

I don't carpool* because I hate having to be ready by an exact time each day, can't be done earlier and certainly not later.

If I was using an on-call car service that I could ping 10 minutes before I'm ready to go each day, I can do that without triggering my concerns.

*Note however: I currently commute by bus since I moved to Seattle, and I make up for hating being ready by an exact time by instead choosing a bus route that has a bus every 15 minutes.

    > 1. Mom, dad, and kid all need to go to work/school at roughly the same time.

This is flexible for most families as school drop off usually happens before a parent (or both) go to work.

Start times (school and work) are just arbitrary numbers. We changed our school start time to help with parents dropping off kids to multiple schools (primary and secondary schools) and then on to work (9:30 start is unusual but fine)

> Mom, dad, and kid all need to go to work/school at roughly the same time.

That's okay, once automation really gets going, Mom & Dad will be out of work, solving that problem.

That's kinda the point. We all work too much right now as it is. http://www.newyorker.com/news/daily-comment/you-really-dont-...

CEO Anne-Marie Slaughter was just in the On-Point podcast saying the same thing (in context to work-life balance and family), that we have a bias for thinking the person who comes in at 6am and leaves at 6pm is a good worker.

This bleeds over into decisions that affects other aspects such as telecommuting, paternity leave, etc.

Bertrand Russell wrote a rather famous [0] essay on it in the 1930's.

0: http://www.zpub.com/notes/idle.html

Russel is one of my favorites and I never knew he wrote this - thanks for sharing.

That sounds funny, but when you put this together with the known increasing costs of supporting suburban infrastructure, it's possible that that whole style of life will be outcompeted and put out of business in most places.

Or it will become a poverty trap.

For rural and light suburban areas I wonder if we'll probably see more of a hybrid shuttle service with at-door pickups, not unlike school buses.

Even without the wage-cost of drivers, individual taxi service may still be too expensive to match the lower demand.

Never lived in the rural area did you?

No one likes buses, because buses are slow. They're slow because they make lots of stops that are irrelevant to your trip. As someone that regularly rode the school bus on a route that took an hour, compared to a 10 minute direct route. Fuck buses.

Yes taxis, exist, but not many. The only people I knew that ever took them were people that lost their licenses.

What you've actually described is a shuttle service. They exist everywhere. They're not popular because they're slow. Last time I took a shared shuttle from the airport it took an additional 45 minutes to get home than driving direct. They have more convenient pick up schedules and locations, but the transit times are almost as bad.

I grew up in a rural area, thank you.

The cycle of poverty is strong in these rural locations because of the lack of public transportation and the cost to maintain a vehicle to hold a job. There are plenty of low-income people moving to common destinations (city center, plants, etc.) that would use an on-demand shared shuttle service if it had at-door pickup.

Having worked a couple summers on a factory line, we would set up carpools and pick people up along the way to work each day. Don't be a dismissive dick just because you personally didn't like your school bus ride.

> cycle of poverty is strong in these rural locations because of the lack of public transportation

Because? Really? Because someone has to buy a car? I think your feelings are in the way of your cognitive ability.

>of low-income people moving to common destinations I'm sure there are plenty of low-income people moving to the suburbs/rural areas because they are being priced out of high density centers.

Lets not forget, 5% of the population uses the bus, that's including major urban centers like NYC. Nationally, nobody uses the bus, its a joke throw back to a time before cars. Fuck buses.

Re: Buses - if you get a chance, come over to Singapore. The buses come by every 3-5 minutes, have world-class air-conditioning, and on the half-dozen or so routes that I ride regularly, I don't think I've ever had to stand.

I rarely bother to even use their (world class) MRT I love the buses so much.

An advanced city is not a place where the poor move about in cars, rather it’s where even the rich use public transportation

Singapore is ~1/4 of the size of Rhode Island and ~200 square miles larger than lichtenstein, the smallest country in Europe. It's like 50k USD to own the ability to own a car which expires in 10 years at which point you will have to scrap it or rebuy this cert. A passat is somewhere north of 150k.

Also, I would add that subways are probably a better way forward than busses for a modern city, or at least some sort of connected underground transport system.

https://en.wikipedia.org/wiki/Driving_in_Singapore

http://www.bloomberg.com/news/articles/2012-06-04/singapore-...

https://www.google.com/search?q=singapore+size

https://www.google.com/search?q=rhode+island+size

https://www.google.com/search?q=size+of+the+vatican

I agree - that there are a number of factors that benefit it's bus system over cars - the reasonable size of the country, and the enlightened attitude towards car owners paying for their externiality costs (the Certificate of Entitlement, or COE).

I also agree that Subways are awesome - and Singapore has an awesome system for such a young country, and they are going to be adding a new one each year through 2024 - That's a new line, not just a new station. [1]

The nice thing about bus stops - is they are everywhere, and the buses come by very frequently, and they all have GPS locators on them - so you can time your arrival to the stop to be when the bus arrives (which you can look up on your smart phone). I've never been a fan of buses before Singapore - but it's great to see what can be done in a country where cars are not the default option.

[1] http://www.lta.gov.sg/apps/news/page.aspx?c=2&id=80d3169f-dc...

Maintain a car, not just buy. For a family below the poverty line & living paycheck to paycheck, this is costly.

55% of commuters in New York city use public transportation, 34% in SF, 26% in Chicago, 40% in D.C., etc. Don't be a dick about cognitive ability when you're quoting a 5% number that includes people who don't even have access to buses.

Those are generally larger buses that are completely fixed in their route and stops, right?

Smaller buses able to optimise routes to make fewer stops will help. Split the current big bus into 3-4 smaller ones and the people going close to the full distance might not stop for the first 80% of stops. That would cut out a lot of time.

Obviously rural areas will be the last to see these changes for non-commercial traffic.

If the city isn't designed for shared transit, even a small trip is going to be awful. SuperShuttle, which picks up 4-5 groups at a time from airports and doesn't use a fixed route, can still add hours to your trip home in LA.

On the other hand, I've used airport busses between transit hubs in cities where everyone takes the subway and it was really quite nice. Better if I ever figure out luggage delivery, of course.

2 seems solvable with reputation? If you trash someone's car you're banned from the service. Also your charged for doing it. They can stick cameras in the car to verify same as taxis have cameras.

Of course the world or the way that you use cars would be different too...

#1, work/school from home, optimized schedules, etc

#2, you could get in/off the "car" in your own little capsule...

#3, those fleets of cars would park at the most efficient spots possible by using big data so the wait times could be reduced significantly (or the wait could be eliminated completely if the schedule is known ahead).

The average person's car is somewhere between messy and a pigsty.

Give people an economic incentive for keeping a neat car, then you're going to see neat cars. This is clearly true for the current Uber and Lyft fleets.

Cars could make pit stops to get cleaned while the owners are not using them.

Additionally, Car2Go and other car sharing services exist and they seem to have figured out how to keep things clean enough.

"Current uber and Lyft fleets" -- they made a conscious economic decision. Maybe think about reality of life, a commute, family, etc.

A friend with an incredibly smart 7 year old still has a messy car. Her daughter, despite the ability to read and understand things well above her age, is a 7 year old. The car is a mess.

When it comes to these pie in the sky utopian scenarios, I wish people on HN would step outside and actual observe every day people.

>Her daughter, despite the ability to read and understand things well above her age, is a 7 year old. The car is a mess.

Right, and that's a choice. It has nothing to do with "she's a 7 year old" and everything to do with "she's allowed to make a mess in the car".

I was never allowed to eat in the car beyond the odd sweet, and I wouldn't have thrown wrappers or anything else on the floor on pain of death... I find it mind boggling that the child is blamed for the state of the car, when realistically it is just a parenting choice. There are 7 year olds with exceptional table manners even in this modern day, and there are 7 year olds I'm embarrassed to eat at the same table as.

I'm fine with people choosing to have messy cars (mine oscillates between spotless and a dump over ~3 month periods) - but it's a choice and other choices can be made.

The point being here, there is "it would be nice", "some fit the model where this would work", and "there are a lot of cases where this won't work". Or even more fundamental things when talking about little ones like things like car seats.

Maybe it is "choice", but there are a lot of people out there where the "choice" around their vehicle is closer to that of it is lived in, may have books and papers, clothing, toys, etc. (maybe food as well) that will not conform to this scenario.

Walk through a grocery store parking lot sometime and observe the state of vehicles as people get in/out, etc. my bet is on a sufficiently large pool would be in the condition where utopian sharing doesn't make sense.

That said, if there was a mind shift because of an overall benefit, it could happen. But, that is a long way off.

I think, just like with most predictions that are based on trends, the current set of expectations will be uprooted by an unforeseen technological advancement.

I'll even go as far as predicting that this technological advancement will be a personal (or family) aerial vehicle[1] that makes commuting as easy as vehicular travel, but perhaps safer, and definitely faster.

In other words, I think the automobile will diminish in quantities, much like the horse, not because people need them less, but because something better comes along.

1. This could be a gyrocopter-like device or a drone-like device, but will likely not be a fixed-wing "flying car", especially beyond the extent to whicih a V-22 Osprey is a fixed-wing.

A personal gyrocopter-like flying car would definitely be a luxury vehicle. Flying is still pretty expensive compared to just rolling on the ground. Only the wealthy would be able to afford such quick, direct travel. But then again, I see telepresence hardware as the thing that takes over as the mode of "transportation" for the wealthy businessmen and women. Why would you need to head into the city to attend a board meeting when Cisco would have a VR system ready to go in your home office? Sit at the desk while multiple cameras create a 3D representation of you. Your colleagues' images are projected around you so it appears as if everyone is in the same room. Motion tracking knows where your eyes are looking and where your head is facing so the images shift according to your viewpoint. Get up and give a presentation standing in front of your desk and get your virtual place in the room shifted to the front.

Everyone can hear you, see you, and most importantly, see your body language. Go a little further with hardware power and have the computer place clothes on you. Wear a ratty tshirt in your home but wear a nice Armani suit in the meeting. Some of this tech is here already but just nowhere near as fast as it would need to be to achieve perfect, virtual telepresence.

Think of the possibilities even if cars stay on the ground.

No more garages and driveways. Neighbourhoods will look a lot nicer, and maybe this will foster community engagement? House design will change, maybe with more multi-family units.

Much narrower roads, with real estate that's now sacrificed to roadway given over to parkland or housing.

Maybe cars will move partially or fully underground, travelling in large-diameter pipes. Like a sewer. Save the surface for people and bikes.

Maybe I can own my own "car interior", a custom box that I can commute in every day. It won't have wheels or an engine, so when I want to go somewhere I'll summon an auto-auto that picks up my auto-box and ferries it around.

The "personalized interior" is the most socially acceptable end case I can foresee.

We conflate two separate things when we consider what cars _are_ - a way to transport ourselves and things from place to place AND an extension of our home. The idea of home extension will be more difficult to break than the idea that you have to drive everywhere.

I think your prediction is a good one. I've been tracking certain technologies and have a wing concept for personal transportation that I'd really like to prototype in 2016, at least to show off the idea and run a couple tests. I envision it as needing only a 'driveway' worth of space to get a person airborn. Still contemplating the whole landing bit though haha.

I think it's crazy unrealistic that autonomous cars will be the majority in anything short of 20 to 30 years. The tech doesn't even exist yet.

It's taken that long just to see ABS become standard equipment across 90% of vehicles.

And this just completely ignores the ~5 to 7 year product cycle. There's no way that in just one or two generations of the Taurus we have a completely self-driving car capable of operating in all normal driving conditions, and that it's displaced the 4 or 5 previous generations of vehicles commonly on the road without the tech.

We went from fliphone to total smartphone domination in 5 years.

ABS is a sideshow, not a revolution. As soon as self-driven vehicles are market-ready, we'll see a massive car park upgrade within one car-generation, which I guess is 7 years. Droves of people will ditch their old cars just for the purpose of upgrading.

> We went from fliphone to total smartphone domination in 5 years.

That's glossing over the Nokia video phone, the Treo, and all the Windows handsets.

> ABS is a sideshow, not a revolution.

I have no idea what you're trying to say.

> Droves of people will ditch their old cars just for the purpose of upgrading.

That seems like something that would require evidence. Or at least a theory to back it up. My 10 mile round-trip is definitely not so onerous that I'd look to replace my vehicle for something that isn't going to make it any shorter or more pleasant.

Here's some context: Nissan has been working on the Titan XD for longer than that. That's just a pretty basic 3/4-ton truck without a lot of bells and whistles with an outsourced engine.

Tesla's Model 3 will have been in development almost that long by the time it's released, and as far as anyone knows, has no new tech.

You're talking about tech that doesn't even exist yet.

Antilock brakes are a sideshow because nobody cares. Yes, it makes cars safer, but few people bought specific cars because ABS was available. It was just another side feature. It was not something that people actively sought out like they'd seek out self-driving cars.

Not with anyone I know. But I guess we're just talking anecdata now.

But yeah, as someone who grew up driving old boats without it, I would never buy a car without ABS.

>We went from fliphone to total smartphone domination in 5 years.

Smartphones cannot kill multiple people on a highway if the software malfunctions. What happens if I am going 75mph and my self driving car crashes and has to restart? What if one the sensors malfunctions and thinks it needs to swerve to avoid someone merging into my lane?

With smartphones you arent putting the lives of whole families in your hand.

40,000 people a year die on American roadways right now. We are horrible drivers and get into hundreds of thousands of accidents per year. No software is perfect, but the bar is pretty low for computers to be better drivers than humans.

The bar might be higher than you think. There are a lot of fatalities true. But the number (which is closer to 30,000) represents about 1 fatality per 100 million miles driven. And a lot of those miles are at night, in snowstorms, etc.

> We went from fliphone to total smartphone domination in 5 years.

How can you even compare those things?!?

A car easily costs 100 times what a phone does, and is literally being trusted with your life and the life of people around you.

> Droves of people will ditch their old cars just for the purpose of upgrading.

Back in the real world, a car is a major purchase and the majority of people couldn't afford to drop their current car and upgrade even if they wanted to.

I think if anything, the change will come in the form of new generations not buying their first car, rather than people with cars ditching them immediately for autonomous riding. For the generation that grew with cars as a symbol of status and adulthood and even national identity, the change might never come or take a long time. Kinda like how I watch Netflix and Amazon and Youtube, and read my news online, but most in my parents' generation watch tv and read paper newspapers. It's not just about the tech, is also the culture.

Also, if anything, it might be more important to incentivize people to switch to electric cars more so than self-driving ones, given the ecological impact. Anyone up for a 500% tax on gas by 2025? ;)

A smartphone doesn't cost more than the average American annual salary.

You don't buy a 747 to fly across the country do you? No, you buy a ticket from Southwest or another carrier.

Kids will one day laugh at how we used to buy vehicles instead of rent them by the miles. "Auto loans?!?" The horror!

Companies that need to use planes a lot do sometimes buy their own (e.g. FedEx does not simply buy tickets from Southwest). Ordinary folks don't own planes because they don't fly around everywhere — they mostly drive.

We already have taxis, Uber and rental cars. People still seem to be buying cars even at their high price. Why do you think that is?

Because there is no self-driving option. If there is, and the price of rides plummets (no driver = cheap, all electric = even cheaper), it no longer behooves you to tie up so much capital in a vehicle you own.

Think how much consumer excess would occur from 300 million people not having to buy a vehicle outright.

And anyone driving their own car needs to pay for parking, plus for full insurance, registration and so on. Free street parking will gradually disappear and off-street parking is not going to get any cheaper.

> And anyone driving their own car needs to pay for parking, plus for full insurance, registration and so on.

Those costs don't go away just because you're renting. In the same way property taxes don't disappear just because you aren't paying them directly in a leased apartment.

> Free street parking will gradually disappear and off-street parking is not going to get any cheaper.

This applies to maybe 10% of the population. And I feel like that's pretty generous. You probably haven't seen much of the US outside of the North East if you think that's even remotely plausible.

If I had a self-driving car and some time on my hands, I'd get rid of my home and be in that thing practically 24/7, seeing the land and enjoying having it drive me around. No way I would rent in that situation. I'd definitely buy. There will be a whole class of similar nomads who will spring up once it becomes truly viable.

The future is not one-size-fits-all. Just because Uber execs and investors are blathering about how personal car ownership will go away (meaning they will own everything, how convenient) doesn't mean it actually will happen that way.

This is something I never thought about. What an interesting shift it would be if remote workers became much more nomadic than most are now.

I'm with you. I'd love for us to get there, but the predictions are highly highly optimistic imho. 15+ years for limited scenarios at best.

I disagree completely, on two grounds:

1 - I think the tech will be there.

2 - Once the tech is there, there will be incredibly fast adoption for a simple reason: price.

First, insurance rates. Right now, you get discounts for eg the sensors in your volvo that warn about vehicles next to you if you turn your blinkers on. Autonomous driving will be like that but on steroids. Insurers will rapidly price in cost falls from autonomous driving.

A second huge cost increase to non-autonomous driving will come from juries. Right now, as a society, we accept car accidents as part of the cost of a modern society because there is no alternative to heavy use of vehicles. Humans driving cars means you will inevitably have accidents. Even if you kill someone in an accident, as long as there isn't negligence on your part, you generally will have nothing happen to you besides increased insurance costs. The second there is an alternative to a human driving, I expect civil juries to start returning large awards and laws to change to include jail sentences. Not to mention coming down hard on things like drunk or impaired driving. eg in WI you can basically get a couple DUIs before the state gets serious about penalties. That will change in a hurry.

I'm curious if this will be another generation-gap thing. Like right now, the stereotype is "only old people still have cable-tv". Will it end up being "only old people still own cars"?

Maybe it will be 90% for <30 year-olds?

I don't see why we couldn't just add more intelligence to the roads to make it easier for cars to navigate.

Before we didn't have tar roads with road signs and traffic lights, etc. It would be infinitely more feasible to make roads more clever than trying to cram human-like driving intelligence into car AI.

Certainly we can, and we will. It will probably roll out in some Michigan cities (and has), San Francisco, Austin, and a few cities.

Then... we wait. How long until Idaho has instrumented cities?

What about construction areas? What about parades? Even with Vehicle to infrastructure communication you will still need AI.

The only thing I'd like to add is that if the car is used this often the utilization rate of the car would significantly increase thus causing the car to go in for maintenance more often. Average mileage on a car is 13,000 per year and if a car is being used to drop the whole family off and then do rides on its own you are looking at 70,000-100,000 on a car per year. You are encouraged to get an oil change every 6,000 miles. Not only that but power trains are engineered with a half life of ~250-300,000 before they become unusable

>Not only that but power trains are engineered with a half life of ~250-300,000 before they become unusable

This makes me think of an interesting side effect.

Will there be pressure on automotive engineering teams to significantly increase drivetrain half-life in consumer vehicles due to automated-driving?

I imagine there are trade-offs made at present that limit the drivetrain half-life simply because there isn't a great deal of pressure to increase the life of a consumer car beyond 300,000 miles ( 300,000 mi * 1 yr / ~10,000 mi = 30 yr old cars).

Semi-trucks may be a nice example where a similar engineering pressure currently exists. A mechanic friend once told me semi's can drive a million+ miles.

Great point, however if these autonomous vehicles are electric (and I'm not saying they would be), they'd require much, much less maintenance than a fossil-fuel based autonomous fleet.

If you look online you will see that most batteries have a estimated mileage of 100k-150k before total replacement is needed. Most Lexus hybrids warrantees end at 100k.

If you are running a fleet of cars or ride sharing yours all day when you are at work, its going to get 100k miles put on it a year. Expect a new battery ($5k-$10k) annual replacement, in addition to the other 80% of the car that isn't hybrid like suspension, electrical system, interior and body.

The fuel savings often goes into battery maint/replacement, if you plan on keeping the car for extended mileage/time.

No argument about the batteries themselves, but self-driving cars require substantially less overall maintenance -- oil changes, timing belts, fuel pumps, transmissions, and even things like brakes all either are unnecessary in all-electric vehicles or maintenance is substantially reduced.

Those services will be able to take place at low-peak times (overnight). Currently getting my car serviced is a chore. When using a car in the future, that process will be invisible to me. And the costs will be absorbed into whatever per-use or subscription fee I choose to pay.

> Barring massive public subsidy for car ownership

You're talking like that isn't something already

> AND FINALLY, as distributed car ownership falls, retail locations for their maintenance go out of business

The number of these doesn't matter as long as they're within reasonable driving distance.

It strikes me that while the back-and-forth of autonomous private vehicles (to send parents and kids off on separate trips) might reduce the total number of cars, it would also probably increase the amount of cars on the streets at any given time, since the autonomous vehicles would have to return home without passengers to pick up remaining family members.

Cars often get used as park-able, lock-able storage devices (for instance, people will often keep their gym clothes in their car, so that they can do work->gym->home instead of having gym clothes at work or doing work->home->gym->home). That's a big design feature that makes driving strangers around much less practical than it looks.

As convenient as a personal locker that follows you is, I don't think the average person is willing to spend 20k for one.

Exactly. We take all our things with us when we leave a plane, taxi, bus or train. We will learn to do the same with cars as cost squeezes from one side and convenience from another.

No but is there any reason a small cabinet on a segue-like platform should cost $20k?

I'm wondering what this does for real estate prices. Cities will become even more livable, but on the flip side suburban commutes will also become way easier.

No, there just won't be private ownership.

It makes no sense to own and maintain your own FLEET of self-driving cars for your own family (since it's virtually guaranteed that multiple family members will need a car at the same time, at some point in time).

Or people could still own self-driving cars and rent them out AirBnB-style when they aren't home.

In the suburban sprawl where the majority of the USA lives, we already have a nicely distributed network of storage (homes with attached garages). That would be far more efficient than having Uber and Lyft build their own duplicate storage for cars, which would almost certainly put them further away from the customers who need them and be far less efficient.

I know this is HN and we're all supposed to be just super ga-ga over the idea of one single company owning the entire future of transportation, but there are many more possible scenarios than just "everyone gives up control and ownership of how they get around".

Classic Jevon's Paradox [1]. Use of the resource (cars) will become more efficient, and rather than use decreasing, it actually simulates increased usage.

Desktop processing apps were supposed to make office workers so productive they would only work a 4 hour work week. The reality? Workers are now so connected that they end up working 6-7 days a week.

If I can rent out my car when I'm not using it, my car is cheaper for me to operate, and more cars are available to drive people around, so they make more for hire trips when they otherwise would not have. More cars, more rides all around.

[1] https://en.wikipedia.org/wiki/Jevons_paradox

The driverless car that you rent will make the fixed costs of using a car go to zero but increase the marginal costs of driving (because there's a middle-man now). However, Jevon's Paradox crucially depends on the marginal cost decreasing, so I don't think Jevon's Paradox applies in this case.

More likely mom dad and the kid will each have three cars

With respect to the third point, I think this needs a source.

People in NYC don't own cars because public transit options are convenient, extensive (at least in Manhattan), and inexpensive.

While Uber/Lyft/etc are convenient and flexible, an unlimited MTA pass is $117/mo. It's hard to imagine Uber's cost dropping so dramatically so as to compete with that.

But maybe you'd argue that they don't need to, because Uber is replacing taxis [1]. I do think the discounted car sharing offerings like uberPOOL and Lyft Line could bring competition to public transit. It'll be interesting to see where their pricing settles in the long run and if/when either experiments with an unlimited rides offering.

1: http://fivethirtyeight.com/features/uber-is-taking-millions-...

I'm in the 'sooner rather than later' camp, and have one more key driver.

Insurance. As soon as human drivers are provably poorer than automated drivers, the cost to insure a meat driver goes up. It will not take long to build a very strong case for the lower risk profile once the early adopter vehicles take the road.

Why does it go up? The price isn't as high as it is because there's nothing better. It's based on the expected cost to the insurer, and that should drop when the predictability of the other vehicles on the road increases.

4 will happen sooner? Doubtful. Get out of US cities. People love their cars and as such, mechanics just like plumbers and electricians are going to be around for years.

There will not be a predominance of consumer owned self driving cars in my lifetime, despite what Tesla, etc. think. Just like how most rail transit in the US makes little sense due to lack of density, the autonomous car won't appeal to everyone due to lack of use, want of control, etc. As such, mechanics will be around for a long while.

People buy vehicles like Toyota Tacomas and will own them for 20+ years. I see that not changing with the 2016s, despite all the announcements of every major automotive company working on autonomous cars.

Maybe in major cities in the US (maybe) and maybe in parts of Europe.

But I don't see it. It's about as farcical as door to door delivery by drone with Amazon. Looks great in theory, practice (and practicality) not really once you dig into it.

GM had and still has an impressive technical research center. Its just that establishment big companies dont get the respect that startup companies do. Nor can the employees win big like in a startup IPO.

General Electric is currently running a humorous TV commercial about this. A hipster engineers friends throw him a "new job party". But they go slackjaw when they discover he joinged GE instead of Facebook. GE has the oldest R&D lab in the country, started by Thomas Edison.

Zazzies > GE.

the ad - https://www.youtube.com/watch?v=OvfU1NpCJQQ

> Its just that establishment big companies dont get the respect that startup companies do.

Ummm... Apple? Google? Goldman? They get "less respect" than Uber and Airbnb and Pinterest?

As someone who used to work at a research lab funded by GM, I can tell you they are incompetent. I was so put off by the experience that I will make sure to never buy a car made by GM.

I'm glad we bailed them out so they could wildly speculate on tech startups.

Well they've paid back the money already (as of 2010 or so?) so I'm not sure that's totally relevant to what they're doing now.

Not really, what your speaking of isn't entirely accurate.

http://business.time.com/2013/12/17/gm-ceo-were-not-paying-a...

You're talking about the delta in share value. The money they took was paid back.[0] They are two completely different things.

> Q: Did General Motors repay its TARP loan from the Treasury with other TARP money? > A: Yes. GM repaid the loan portion of the automaker bailout ahead of schedule, with interest.

The article you cite seems to suggest that the government should have had some sort of guarantee from GM that the gov't would be able to sell shares back for no less than what they paid for them. I don't think any such promise was ever made.

> taxpayers are still stuck with GM stock that isn’t worth what was paid for it.

[0] http://www.factcheck.org/2010/05/general-motors-debt/

This might be a bit technical, but the company that received a bailout went through bankruptcy and re-structuring.

https://en.wikipedia.org/wiki/General_Motors_Chapter_11_reor...

So they didn't get a bailout that they are now using to "wildly speculate on tech startups" because all that capital has been restructured.

Many companies did get bailed out in a market where raising capital was near impossible and as a result recovered and are involved in investing in tech companies both equity and debt. Although I'm guessing your particular objection here is that they're a non-financial company and it doesn't seem to be part of their core business?

> I'm guessing your particular objection here is that they're a non-financial company and it doesn't seem to be part of their core business?

Although I'm pretty sure every major automaker is also a financial company, and has been for quite a while. All those special 0% down or cash back deals don't come from the dealer.

GM's financial arm was GMAC, which, while bailed out during the financial crises, eventually rebranded and IPO'ed as Ally Financial.

The US Treasury made a ~ $2.4 billion profit on a $17.2 billion investment: https://www.treasury.gov/press-center/press-releases/Pages/j...

On a risk-adjusted basis, that's a pretty mediocre return.

Considering the profit was at most a secondary goal of the investment, I wouldn't consider it bad at all.

Sure (I was aware of most of that in general, but not the specifics), which only slightly alters my point, which is that major automakers have lots of experience in finance at certain levels. GM may have sold off a large portion of the division that handled this for them, but I would be surprised if there's not still a lot of people with quite a of of experience in finance embedded somewhere in their org.

My real objection is to thinking of automakers as not having finance as core to their business. The vast majority of new car purchases are financed in some manner[1], and many of those are through the financial divisions of the automakers[2]. To my eyes, finance incentives are core to their marketing, and marketing is core to their business.

1: http://www.consumerreports.org/cro/news/2013/09/car-financin...

2: http://www.reuters.com/article/us-autos-financing-insight-id...

>The US Treasury made a ~ $2.4 billion profit on a $17.2 billion investment

Factor in the interest USA would have saved by paying down the national debt instead. Additionally, consider what private investors would have returned with the same investment and what they would have paid in tax on personal income if they had never been taxed that $17.2b instead.

They won on this one, we can point at the various Solyndras the USA has bet on and lost while we are at it. This ignores the fact that we don't mail taxes in for government to act like a massive VC. We send the cash in so they can fix the 'crumbling roads and bridges', service debt and help the poor we are always hearing about.

>Factor in the interest USA would have saved by paying down the national debt instead.

The average interest rate on the debt is 2.43$, we have around $17 trillion debt, and you're talking about a $17 billion paydown (0.1%).

The amount of interest saved would be around $400 million per year. The profit on the GM bailout was $2400 million, so it would have taken 6 years for the decreased interest to total 2.4 billion.

>we can point at the various Solyndras the USA has bet on and lost while we are at it.

Can you point to the value of the hundreds or thousands of engineers and employees of failed new energy startups that received invaluable real world training and experience who are lending those talents to other companies.

Think about NASA and the 18 billion we "piss away" down that black hole every year, and the huge benefits that we derive from their work and the experience that those who work there gain.

Not every investment the government makes has a return in next-year-dollars.

Debt: 6 years to realize the savings on the interest? It nearly took GM that long to repay the debt they took on. It's sounding like a worse investment all the time.

OTJ Experience: I think it's less speculative and lines less wealthy billionaires pockets to invest directly into education and industry beyond private market money to provide great learning experiences for people.

>It's sounding like a worse investment all the time.

Until you realize the negative feedback loop of hundreds of thousands of GM employees hitting unemployment lines, and the secondary and tertiary companies that supply and contract for GM also shutting down. 200,000 employees * 1,000/mo unemployment * 100 weeks = $20 billion dollars. Obviously a terrible case, but not even a worst case as I examine only GM employees and not the subsequent losses in direct suppliers/contractors and community losses relying on those employees patronage.

Sure, the investment may not have great returns.

But are you calculating the billions in reduced welfare, or the billions in increased GDP, or the effect of stopping a negative feedback loop which spirals more deeply?

I mean, a GM level destruction isn't just GM. Isn't just suppliers. It's grocery stores. It's car mechanics. It's big box stores. It's fast food. It's everything in those communities that former employees patronized.

When you examine the decision more deeply than "net dollar returned" I think you'll develop a greater appreciation for the economic benefits of entire communities not being ruined.

So the core of it is; the ROI is irrelevant, it's value was the prevention of job loss and market failures.

Now you see why I'm not excited and jumping for joy when people spin it as a profitable investment. It never was a money making endeavor, if it turned out to be, it was by happenstance.

Slightly technical point, but the average interest rate of outstanding debt is not particularly relevant, the relevant would be the average short term rates over the span of the investment. Would've been much lower than 2.4% over the life time of this investment.

Consider the loss in tax revenue and increased social program expenditure if the industry collapsed and some portion of the ~ 2 million US auto-workers lost their jobs. Consider the effect this could have had on the wider economy, and how that could have affected government finances, not to mention the average citizen.

The US government has always invested in it's industries, either through broadly applicable programs like the patent office, or through more targeted items like specialized laws and grants for specific industries. Cash investment isn't really all that different, except they might actually expect some sort of monetary return on that investment, unlike grants.

Just want to comment on the "Factor in the interest USA would have saved by paying down the national debt instead." statement. During the financial crisis paying down the national debt would have been pure folly. The US was borrowing at basically 0% at that point and purposefully trying to flood the economy with cash.

I made some pretty unreasonable but convenient assumptions with the basic compound interest formula in back-of-the-envelope math to arrive at ~2.25% annual interest rate.

http://www.wolframalpha.com/input/?i=compound+interest&a=*C....

Assumptions:

- I know the amount was not dispersed all at once at the start

- I have no idea what compounding frequency seems appropriate

- Does not account for inflation

- Time frame: 12/29/2008–10/17/2014 per the linked pdf [1]

Aside: $17.2B 2008 dollars adjusted for inflation becomes $18.89B 2014 dollars.

https://www.wolframalpha.com/input/?i=17%2C200%2C000%2C000+2...

That makes the return a bit less exciting.

I'd love to model this in a more accurate way if others know how that might be done.

1: https://www.treasury.gov/press-center/press-releases/Documen...

You get it. Some times the automotive side takes a backseat to the financing.

So you're saying a stagnant company in a stagnant industry that almost died should remain stagnant and not try anything risky at all?

It's not wild speculation for GM. They most likely have ways to work together. It's unlikely a completely passive investment.

It should have been allowed to fail, propping it up is unfair competition against its stronger competitors.

GM has good reason to make risky decisions, since the taxpayers will likely be asked to support the company a second time if it runs into trouble. As a taxpayer, I would like them to be as safe and stagnant as possible, but I have no say in the matter. This is the moral hazard created by the bailout.

Ford was in bad shape in 2006.

Does anyone even remember the Ford of 2006? With their awful Focus when everyone was clamoring for the euro version? Or the Ford 500?

They didn't avoid a "bailout" because they were a strong company. Two years earlier they mortgaged everything (including the iconic blue-oval logo) while money was still cheap. It was pure luck. Not strength or some sort of moral superiority.

So by the time the crash rolled arounds and GM and Chrysler couldn't do the same, Ford had already secured over $25 billion in funding, with another $5 billion in government loans to refresh some factories to produce greener cars.

I'm not trying to argue GM or Chrysler did or didn't "deserve" a bailout. It's just a pet peeve of mine that there's this revisionist aura around Ford these days. They sold Jaguar and Land Rover to Tata for $2.3B, about half what they paid, and significantly less than they've made since. They sold Aston Martin for about $1B (well, that one was probably not a bad idea at least). They also sold Volvo for another $1.5B. They liquidated their stake in Mazda to the tune of about $500M dollars. Discounting the F-series, Ford easily had the worst portfolio, and were in trouble years before the others. They sold off several brands at a significant loss for some quick cash. Not all of those were smart moves in hindsight and they lost their shirts on most.

While Ford has taken government assistance, they've milked their amazing ability to avoid TARP by failing before everyone else for all it's worth. Will they be as lucky next time? What are they going to put into a $10B fire-sell next time? And will they be lucky enough next time to secure $25B in loans while the market money is still flowing? Will the government be handing out $5B loans to modernize factories?

I guess time will tell, but I felt like the conversation could use a little balance.

This all points towards i being a market problem that the government tried to mitigate (which fits their narrative), not a problem specifically with GM being so bad it needed a bailout. If the market wasn't in the disarray from the beginnings of a recession (and IMO what might have well been a depression without intervention), then it's entirely possible that GM would have found enough investment from other sources to pull itself out of the problem (as you point out, Ford was able to do it a few years prior, and GM was able to do it with the government investment).

Investors that think the government will bail out GM again just because they have in the past are betting money in a way that they're likely to lose. The important factor of the GM bailout wasn't GM, it was how the industry as a whole was doing, and how the financial markets were acting at the time. GM would have been the first of a set of dominoes that included most if not all the auto-makers due to their shared dependencies on the parts companies that would have went out of business (which Ford testified to at the time). The important thing here is the dominoes, not GM. They just happened to be the first one in line.

I apologize if this is incorrect as the only bits I know are from my interest in cars and not finance, but I don't think it was completely luck that Ford decided to try to get money. From what I understand, they did all this because Alan Mullaly just took over as CEO and he wanted to cushion a potential unexpected event.

At least that's what it says here: http://www.nytimes.com/2009/04/09/business/09ford.html?scp=5...

As far as I can tell, Alan Mullaly is a very good CEO who many consider to be responsible for the comeback of both Ford and Boeing. I remember there were rumors he was even considered for the position of CEO of Microsoft. That being said, I don't think you could say it was completely luck.

It's always a mix. And is it luck or preparedness and foresight? Either way, there's a strong argument to be made that Ford was in very bad shape, and their timing in 2006 was amazing. Had they held out much longer there might very well not be a Ford today.

This is an interesting article I just ran across, and suggests the fundraising actually predated Mullally: http://fortune.com/2011/05/25/fords-forgotten-man/

I dunno. Ford is looking a bit 90's Apple right now IMO. Product (outside of the F-series) seems a week point.

I just finished reading American Icon by Bryce Hoffman.

Ford realized they needed to change long before this; around 2001 (around the same time that Bob Lutz was preaching to GM). Bill Ford and Mark Fields were already planning to do many of the things that Mulally wound up doing.

What Alan Mulally did was still incredibly amazing - he restructured the reporting structure at the top of the company, increased accountability, increased transparency, increased trust and made people deliver on the plans. He got people to surface their problems at the executive level, where before everyone hid the issues for fear it would be used as ammunition against them by fellow executives.

Mulally emphasised the core brands, and in fact wanted to ditch ALL the brands except for Ford. He got Ford to bring over the European models that were far superior to their equivalents in the USA. He brought the Mazda product development model to Ford, where the engineers and designers sit in the same room. He sped up implementation of Global Ford Production System, patterned in large part on the Toyota Production System. He worked with the UAW to decrease legacy costs by funding the VEBA (UAW run healthcare fund) and trading worker concessions for promises to keep production in the USA. He worked with suppliers to decrease costs and increase supplier satisfaction. He reduced the number of dealers.

When I say "he" did these things above, I mean he pushed for them. In almost all instances they were accomplished by other executives and team members.

The discipline and planning were not luck; the timing was very lucky indeed.

As the article states, GM is going to help Lyft set up rental centres across the states. I imagine this means GM vehicles therefore GM is not only investing in Lyft, they also get people driving their vehicles and passengers sitting in those vehicles. It's almost advertisement.

It's an awareness piece for investors about GM's market investment into Lyft's new rental fleet.

This is not a valuable contribution to any discussion.

GM should be developing their business, in part to ensure they don't end up in a situation where they are stagnant and need bailed out again. Investment in startups in the same industry is a sensible approach to this.

Yep because bailing out a capstone company buttressing up an enormous cottage industry of parts makers was such a bad idea.

The bailout was massively profitable for the government and every penny has been repaid. Investing in innovation is exactly what a company like GM should be doing and our tax dollars are in no way involved in this.

Edit: didn't make money on GM http://www.reuters.com/article/us-autos-gm-treasury-idUSBREA... Made lots of money overall: http://www.nytimes.com/2014/12/20/business/us-signals-end-of...

This is entirely untrue, pertaining GM. We tax payers lost tremendous money on GM[1], and then GM restructured (think "good bank bad bank"[2] style nonsense) in a clever way to ensure that we would never reap the benefits of the future success of "GM".

1. http://www.reuters.com/article/us-autos-gm-treasury-idUSBREA...

2. https://en.wikipedia.org/wiki/Bad_bank

Good point! Very good point - I still think investing in innovation is the only thing that makes sense for GM, the reason the auto bailout worked out is because Ford*, for example, did and is crushing it.

http://www.nytimes.com/2014/12/20/business/us-signals-end-of...

Edit: Ford did not take bailout money so that logically does not hold like I thought it did. Point about innovating still holds fine.

I was under the impression that Ford was the only one that didn't take a bailout.

You are correct.

IIRC Ford actually got very lucky in that they were actually in huge trouble before the market crash and decided to mortgage the company right before the credit market seized up. So that was really why they didn't need to take the bailout.

I would argue they were also better run than GM during this period.

Canada lost about 3.5B[1] on the bailouts to GM and Chrysler as well.

[1] http://www.theglobeandmail.com/report-on-business/canadian-t...

That's because in 2009, G.M. filed one of the biggest Ch. 11 bankruptcies in history, which the bailouts failed to prevent.

Didn't the government take a 61% percent stake in the good bank part of the company?

Wikipedia links this WSJ article on the topic:

http://www.wsj.com/articles/SB124646098696280443

The second paragraph mentions the US government being the majority owner of the new company.

Am I misunderstanding which clever restructuring you are talking about?

> The bailout was massively profitable for the government and every penny has been repaid

I don't really have a stance on the GM bailout, but your statement here is missing something important - every company that a government gives billions to will do disproportionately well in their industry in the short term and give solid returns. But the role of taxpayer money isn't to select winners. The free market is supposed to weed out the chaff.

Edit: Want to add a PS - the government might "make profit" on the investment, but structurally the market and society has lost.

The government didn't give money, they invested because the market wasn't in a position to do so when the industry needed it. The narrative that the company is only going to do good short-term because the government gave them a lot of money doesn't make sense when the government has since sold it's position in that company for a profit, meaning the market now viewed that company as a more favorable investment then they did when the government intervened.

> The free market is supposed to weed out the chaff.

The free market doesn't care about stability, but we as the people that deal with the market, should. An unconstrained free market will swing wildly, which is one of the ways it will identify the chaff to cull, or depending on how low the swing is, the not-quite-as-good wheat to cull. The US has long recognized the benefits of a steady economy though, so while there isn't as aggressive culling, allowing some mediocre companies to survive, the environment itself is more amenable to sustaining a population of people which is the whole point of the economy.

> they invested because the market wasn't in a position to do so when the industry needed it

How is this different than "The industry planned poorly and deserves to have its assets liquidated?"

Because that industry employed two million people and a blow that large to the workforce with the economy how it was might have resulted in consequences that reached far beyond that industry.

Put another way, a free market will result in the best solution. Eventually. There's no reason we can't target what might end up being cascading failures to reduce the negative swings in the economy. I would hazard that this will result in a better economic outcome quicker, but even if it doesn't, I think it at least results in less human suffering, which is a fair trade in my eyes.

As I understood it, the durable goods industries are the part of an economy that gets hit the most in a recession: Whether B2B or B2C, in the case of an uncertain economic outlook many customers will postpone investments in durable goods (e.g. cars, machining, housing upgrades like better heating/isolation systems etc.) more than they'll do with other products.

So: Many companies were similarly over-leveraged, but those in the durable goods industries were folding over it.

See IIRC Finland as an example: No banking or housing problems in 2007/8, but still in a recession because of the big role durable goods exports play in their economy.

What you're completely ignoring is the consequences such bailouts have on the market dynamics[1]. It creates a massive morale hazard which can and will incentivize market actors to take part in risky behaviour. If you are seeking to stabilize the "free" market, you are not going to do it by rewarding the losers or picking the winners.

Failing is just as important aspect of a self-regulated system as is the price, since the government voided that mechanism since forever we have an entirely disrupted market perfectly conditioned for too-big-to-fail participants.

[1] https://en.wikipedia.org/wiki/Moral_hazard

I think that depends entirely on whether you saw what happened as the government bailing out GM, or the government keeping an industry from collapsing, which just happened to by by taking the first major company of that industry to fail, and injecting capital. I don't think it would be wise to expect the government to bail GM or any other auto-maker out of a financial problem in all industry conditions and all market conditions. Investors that expect that will lose their money to investors that correctly assess all the preconditions required. I don't expect most investors to be so stupid as to think nothing bad can happen to their investment in a failing company because occasionally extreme measures are taken in extreme circumstances. At a bare minimum, they should recognize that even if a company is bailed out, that doesn't guarantee a positive return, just a theoretically less negative return than before.

Whether or not the bailout was a good idea wasn't at issue. It's whether tax dollars are still tied up in the company or not and therefore whether the taxpayer has a right to judge the behavior of the company in that lens. At least that's how I read it.

So Google+Ford, Lyft+GM, Tesla on both sides software/hardware... Where is Uber's Hardware going to come from now?

I wonder if this is an instance where the personalities involved with Uber are having a detrimental effect on these sorts of long-term needs. Or is there something yet to be announced?

To answer my own question after thinking for a couple minutes: maybe VW's fall will put it in a position for Uber to get in play.

Interesting point about VW: To my knowledge VW has no car sharing/CaaS service in Germany. Others are better setup if self driving cars take over: Opel (GM) has one, BMW has one (DriveNow), Daimler has one (Car2Go).

VW has Greenwheels (not really that common or popular though) and Quicar (only in Hannover)

Thanks, didn't know, haven't seen VW CaaS cars in Berlin yet.

Fiat/Chrysler? Renault? Nissan?

I doubt Toyota or Honda will bother with Uber. But who knows!

Didn't Uber buy the Carnegie Mellon robotics division? Is it too much to think they might try for their own hardware platform?

It might be, but why else do so?

I thought they just made a deal with CMU and then proceeded to recruit everyone to leave.

They will still need a chassis/engine before they have a viable car, and there's been no real external indication of them either developing that in house or partnering with/purchasing someone that can provide that expertise.

.. at least I think that's what the question is about.

Uber planned to buy 2,500 driverless cars from Google (GX3200, investment of $375m), announced back in 2013 [1]

[1] http://techcrunch.com/2013/08/25/uberauto/

And from Tesla too

http://www.greencarreports.com/news/1098997_uber-ceo-to-tesl...

Look at the publication date. I'm not sure what TechCrunch was trying to accomplish doing that. It wasn't even the right day of the year for something like this.

Edit: Apparently the point was to test what rebloggers would believe: http://www.slate.com/blogs/future_tense/2013/08/27/uber_goog...

Chinese automaker GAC recently invested in Uber. techcrunch.com/2015/12/21/uber-china-lands-strategic-investment-from-chinese-automaker-gac/

All eyes are on Silicone Valley, but I think China will be the first to allow fully autonomous cars on its roads (Chinese-made of course).

But they still need the actual vehicle hardware, chassis, motor, etc knowledge. CMU's robotics division is just provides the self-driving component.

Developing a car is very expensive.

and yet it's the easy part in the self-driving car problem, re how you can navigate the car in a fully autonomous way.

Building a car is 5-10 years out. It's a long, slow process. And you need to clear dozens and dozens of safety protocols.

You know that Google Ventures put $200m+ into Uber right?

So... the answer is Ford, I suppose.

Don't forget Apple.

Google invested $1 billion into uber a few years ago, didn't they?

Tata (a large automobile company based in India with cars globally) invested $100m in Uber. I imagine there will be more from other companies.

GM's current mktcap is about $53B. A $500m investment represents putting almost 1% of their company into Lyft. Tesla's mktcap is about half of GM's, so this investment represents 2% of Tesla. Uber's last valuation put them above both GM and Ford, so what GM is looking at is a Lyft competitor "worth" more than they are and they want in.

I don't really care about talk of tech bubbles, but seeing older institutions invest so aggressively in startups is gnarly. Both Fidelity and Blackrock went into Uber and now GM owns a huge piece of Lyft.

I don't really have a point. Just thinking out loud because I'm not sure what to think...

"GM and Lyft said they will work together to develop a network of self-driving cars that riders can call up on-demand."

Pretty interesting. Especially considering Ford has been linked to working with Google on developing self-driving cars. [0] Though, it seems the Ford family is also involved with investing in Lyft.

[0] http://finance.yahoo.com/news/ford-talks-google-build-self-0...

My theory is that with the ever increasing reliability of cars, they aren't being replaced as often due to low utilization (sitting idle most of the day). Having a more highly utilized fleet of vehicles will mean they get replaced more often.

This isn't a big vehicle sales growth strategy, but it could be a way to preserve vehicle sales, while keeping a foot in the door of the future. They might even be able to get away with spending less to manufacture these cars, since people don't care as much about finish quality in something they don't own.

Also, the interiors of the vehicles would probably degrade faster than the mechanical and electrical systems, so GM could probably make a business in remanufacturing and certifying such vehicles for return to service, or putting them into cheaper tiers of service.

Essentially, that would be the partial transformation of GM into a large fleet management/maintenance company.

EDIT: wording

Correct. If my car drives me to work, then drives other people around all day, it will rack up miles far faster than before. Now, instead of driving 12K mi per year, it can rack up 60K mi per year. I'll need a new car every 3 years.

Luckily, it can also schedule maintenance and drive itself to the dealer too.

"G.M. will also work with Lyft to set up a series of short-term car rental hubs across the United States, places where people who do not own cars can pick up a vehicle and drive for Lyft to earn money. Daniel Ammann, president of G.M., will join Lyft’s board of directors."

This reminds me very much of the taxi model; where the driver is going to start the shift in the hole and has to work their way out of it.

Maybe they could paint them in a special livery so that you could tell it's a Lyft from a distance ;)

I know that you and parent are joking about lyft being just another taxi service, but would that really hurt them?

Lyft and Uber win because of the ability to rate their drivers, ease of payment (imho Uber wins this much more than lyft), and the fact that everything about your trip is tracked.

You get into a regular taxi, and who knows who is going to be behind the wheel, what state the car is going to be in, what sorts of payment they'll agree to take, etc.

Uber and Lyft took all of that nonsense out of the transaction. THAT is why they're winning (that, and cost), not because of what their cars look like.

I actually thought that's what was happening here. Why not make both brands more recognizable? Have GM cars with special "Lyft" paint jobs such as painting the pink mustache on the front. I think it's an interesting angle beyond just creating some taxi pods.

It's a good idea though. It forces the driver to take as many rides as they can (or at least until they become profitable for the day). The rest of the time the cars get used as a car sharing service. Sounds like a good plan to me.

If the driver didn't pay 100% cash for their vehicle, then they're already starting in the hole, just in a different way.

Technically, if they had to spend $x thousands of dollars they are already in the hole.

The "short-term car rental hubs... where people who do not own cars can pick up a vehicle and drive for Lyft to earn money" is a nice idea in the short-term. I still think Uber has the right idea long-term with a completely autonomous fleet, but once those hit the market, there will still be a pretty large demand for NON-autonomous vehicles -- take my parents, for instance, who refuse to get into a car not driven by a human.

Your parents will be irrelevant in 2 or 3 generations from now. At some point, fully autonomous will be a norm without the fear.

2-3 generations is a long time to make money.

Tell that to Jeff Bezos.

When do you want your return on investment? Within the next 20 years or within the next 60?

Hence he said "short term". 2-3 generation from now certainly isn't the short term

<<I still think Uber has the right idea long-term with a completely autonomous fleet>>

I agree that this is probably the end state of this space, but I think this is much more Google's than Uber's vision - Uber is terrified of autonomous cars (since it eliminates the supply network effect of their driver network and opens up the space to anyone with deep pockets).

Once autonomous cars become a reality, I think you are going to see a fierce battle between Uber and Google.

>Once autonomous cars become a reality, I think you are going to see a fierce battle between Uber and Google.

Google Ventures invested $258M in Uber in 2013 and are one of it's largest shareholders.

That doesn't necessarily prove anything. Google and Apple were partners before Android.

Google Ventures independent from Google (and goes through pains to point this out when you pitch them). While there is obviously a lot of synergy, Google Ventures employees are not Google employees, and do have not have Google stock options.

Also, if you want to look back through the annals of tech history, many larger companies partner with disrupters when a new technology emerges, only to enter the market when the new technology grows into a significant market.

> take my parents, for instance, who refuse to get into a car not driven by a human.

I think people are doing lots of things that they couldn't imagine doing before those things existed/became widespread. How many people would never get a cell phone and has one now?

People need to see that stuff works and then they become adopters.

Isn't that just a marketing and PR problem, first and foremost?

"The new [insert brand here], safer than any other vehicle ever developed [insert statistic here]. It will bring you where you want to go, fast, safe and while you can tend to the things in life that really matter [insert family/reading/working montage]."

I'm no adman, but I think it won't be too difficult to sell this. And if all fails, lower insurance rates, or rather higher insurance rates for manual drivers, will sway a lot of people.

One area I haven't seen mentioned is the loss of human interaction. For many just having someone to talk to/at during the trip is needed.

Eliza and Siri can accompany them...

Here's where it will be a showstopper for me; many many times the uber map has fucked up directions and so I tell the driver the route I want to take, or to pass a particularly slow driver in front, in addition I sometimes change my destination/add a stop.

How easily can I do any of this with a robot car?

Touch screen panel, make options available to adjust the route taken? Doesn't seem like a hard problem to solve, especially compared to all the other problems that need to be solved to make autonomous cars a reality.

Have a big touch screen in the car that shows the destination and the route the car is going to take? And allow you to drag/drop to alter the route similar to Google Maps?

Changing the "messed up" directions is a strawman in your head. Sure, in the beginning those complaints would be more prevalent, but as the "rate your ride" complaints get sent up to Google, I'd imagine that there will be an army of people re-training the AI to minimize these kinds of inefficient glitches to the point that they rarely if ever happen. Google does this today with an army of yellow-badge employees who fix Google Maps.

I think many people would prefer to sleep, watch movies or read a book than talk to someone for hours in a car.

When that happens you can almost bet that it will be a hypercompetitive market which is likely to eventually be dominated by car manufacturers. I mean why do you need Uber at all when you make the car itself and all of its inside. It's not as if the software to coordinate pickup and drop-offs is rocket science. And neither is customer service. I look forward to how cheap and easy it will be and how the manufacturers will cut out of the middle men out of everything.

This is interesting. It's what Christensen's theory of disruption would say, given the time, (lack of) complexity, and the curve of 'good enough.'

The only thing could be branding. There is a reason many people buy iPhones, or bottled water in a fancy plastic container for $5/bottle.

Would we want Uber because it's "better" than GM, which does not have a huge appeal? Then again, a car is a car is a car, if it is on time, clean and cheap.

> Then again, a car is a car is a car,

also, a phone is a phone

an airline is an airline

a shoe is a shoe

....

Clearly consumers have preferences in any of these markets today. Even in cars today. That won't change with CaaS.

> many people buy iPhones, or bottled water in a fancy...

> a car is a car is a car, if it is on time, clean and cheap.

I wouldn't be so quick to dismiss branding as being inconsequential.

water may be water, but there's a fairly high expectation to achieve when it comes to user experience that's associated with branding. The minimum the general public will expect is "on time, clean, cheap".

While the HN population may have a significant size of community that looks to optimize for cost, the a large portion (maybe huge subsection?) of the population make choices based on the "premium" experience.

"What you thought I'd call an UberX for you?" "Starbucks is way better than Dunkin Donuts" "iPhones are so much better than Androids" "Voss water is more refreshing." "My Lexus is so much smoother than the Toyota" "Target, where you pay a little more to avoid the people at Walmart."

As asinine as it sounds to us, there's a significant population of vanity that wants to be monetized for the benefits of social signaling and/or the additional desirability of a given brand.

I'd anticipate that the consumer market will be similar to the vehicles available today with the potential following major divisions in autonomous driving.

Value - 5-20+ minute wait times. it may be a little dirty, a little smelly, and sometimes will be nice and clean (nice surprise) but will focus on absolute lowest cost. (Kia, Hyundai, Suzuki level car) $200/mo for 1000mi

Premium experience - 1-15+ min wait times. generally clean & comfortable. (Toyota, Honda, Ford, GM family sedan level car) $200-500/mo for 1000mi

Luxury - 1-5+ min wait times in major suburban counties. high guarantees on wait & cleanliness. Optional personal concierge in car that helps with loading, groceries, etc (BMW, Lexus, Mercedes level car) $300-1000/mo for 1000mi

Executive - dedicated service in the equivalent of a 100k+ car (BMW 7 Series, Mercedes S Class level car) $2500+/mo for 500mi, $5000/mo for unlimited mileage.

With all that said, catering to these different markets may require quite a bit of pivoting for existing car manufacturers and of administrative burden they may not necessarily want or care to deal with. I also see car manufacturers doing something similar to drop ship online stores of today to prevent car buying power aggregating to only a handful of powerful buyers responsible for 95% of the business.

How affordable will this be? Example, the rates for fairly current model cars can be near a hundred a day, if not triple by week. So is GM going to cut this rate? Then to top that off if you are in NYC the medallion rental can be over a hundred a shift. This is on top of your gasoline and insurance costs.

Now is lower tier cities costs should be lower but that chunk coming out to rent what I assume is a fairly newer model is going to put a dent in your money making. You are in effect paying the car off for someone else.

That's kind of interesting for me to hear.

The last few times that I've rented an Uber, the driver (I usually use the "black car" option) usually shows up in a rented National/Enterprise vehicle (if you rent enough vehicles in a year you can tell the differences between the three big rental companies).

The plates/vehicle description tend to match what arrives for me (e.g., Uber tells me that I'm expecting a Black 300, I get a Black 300); admittedly, I do not know what happens on the back end to add a vehicle (if it's Uber or if it's the driver), but, it seems to me that this is already happening in some areas.

>I still think Uber has the right idea long-term with a completely autonomous fleet...

I really disagree here. I think the biggest strength of Uber's business model is that they offload all of the maintenance, fuel, liability, registration, etc. costs (as well as the cost of managing all of that) to the drivers. In addition, local regulators have been treating Uber with kid gloves in a lot of markets because Uber "creates jobs"; when Uber starts getting in the business of putting drivers, both their own and drivers for other companies, out of work, I wouldn't be surprised if a lot of markets start making it even harder for them to operate. Don't get me wrong, I'm very excited for autonomous cars, and absolutely think they will be omnipresent in the long-term future, but I don't think Uber will be the company that dominates that market, at least not in the short-to-medium term, and trying to do so will be their Waterloo.

Uber could still offload maintenance, fuel, liability etc to other entities and license the self driving software to them. Those entities would still have much lower operating costs than human drivers. They could even open source the self driving software to commoditise their complements [1].

Personally I hope that regulators do a bait and switch on Uber by allowing them to build a temporary monopoly and then reintroducing competition by introducing the "right to be represented by a bot" [2].

[1] http://www.joelonsoftware.com/articles/StrategyLetterV.html [2] http://continuations.com/post/108912689660/big-and-bot-polic...

how often do your parents have the chance to refuse a ride in a car not driven by a human? Do cars with cat drivers count? What about chimps?

Of course there is a spectrum of trust when it comes to autonomous vehicles.

I refuse to ride in a car driven by many humans, including quite a few close friends who are terrible drivers. I would be very likely to ride in an early autonomous vehicle, and rely on my adaptive cruise control heavily already.

I don't know whether this is a real difference or not, but Lyft "feels" like a much nicer company than Uber. I'm not thrilled about Lyft's rampant hipster-branding, but Uber seems like a company run by pricks.

Maybe it's just because they're the underdog, but I'm really rooting for Lyft.

If nothing else, I'm rooting for Lyft so that Uber is not the only one out there. I'm scared of what would happen to service / prices if Uber had no real competition. For that reason, I only use Lyft.

Local monopolies are usually the rule rather than the exception, with global monopolies rarely (if ever) occurring.

This makes me wonder if Lyft can leverage the backlash against Uber and achieve success in areas hostile to Uber but not hostile to ridesharing/Car-as-a-Service services.

It is essentially a land-grab but on a global scale, with the measure of success being on-going local dominance on a per city basis. Personally I find it fascinating, the goings-ons of municipalities are usually quite opaque to outsiders and the insight is new.

Local monopolies are the norm in industries where massive capital investment is required (electricity, cable). Uber is not this type of business. Uber is more like a marketplace (like Amazon or Ebay)... while network effects are strong there is no reason to think that local monopolies are inevitable.

Also, if you catch an Uber in SF or Seattle, the driver is likely to be running Lyft and Uber. Sure, Uber can try to give drivers disincentives to use multiple apps. But good luck doing that AND staying out of anti-trust investigations AND convincing everybody that their drivers are still contractors not employees.

Think back to Uber's beginning. It was incredibly elitist - only black cars, twice what a taxi cost, etc. Even the name reflects that.

They're almost at parity now though, at the normal person level in Chicago at least. I get nearly killed by either on my bike just as easily :)

>I get nearly killed by either on my bike just as easily

Glad I'm not the only one who notices these cars randomly driving slowly or parked in the bike lanes waiting for the next ride to come in.

Ride safe..

In NYC, where Uber/Lyft drivers are required to operate Taxi and Limousine Commission-licensed cars, citizens can file complaints via the web, leading to tickets: https://twitter.com/hashtag/cyclistswithcameras

They get more distracted by the phones I believe. Specially in between rides when they have to accept ride requests in a timely fashion.

I've seen drivers parked in lots when they are awaiting a request but in places where parking is charged such as downtown, I think they prefer to keep looping around blocks.

There may be an interesting case study to be made on the environmental impact of these idling cars.

Also, some drivers are lazy and don't get proper mounts for their phones. I've had a few Lyft drivers spend much of the ride with their faces buried in their phones because they didn't bother to get a mount and don't want their nav to speak out loud.

I also had one reckless idiot spend the whole ride texting while driving, too.

All the evidence that I've seen shows the Uber folks don't care about the law, their drivers or the general public.

I don't know that Lyft is better, but I haven't seen the same level of disregard for others.

When I was in Colorado Springs, Lyft was much more available than Uber so I used it for the first time after only having ever used Uber for the past year.

The major thing I found different was the driver wanted me to sit in the front and was much more enthusiastic about conversation. It wasn't bad but it was definitely different and somewhat offputting. Not sure if that was just a single event, but I wonder if each company encourages those differences in driver interaction.

That convivial atmosphere is one of the things that originally set Lyft apart. More recently, they've tried to figure out how to balance that with people who prefer silence. http://thehub.lyft.com/blog/2015/7/14/giving-betterrides-gre...

Sounds like a Colorado Springs effect. Here in NYC I've used both fairly evenly and (unsurprisingly) the experiences are fairly similar and in line with the typical "uber" style of sitting in the back and not talking unless you choose to reach out...

From my experience in NYC many drivers drive for both Uber and Lyft. In an anecdotal poll I ran with those drivers, they say Uber riders usually like to be left alone while Lyft riders are more chatty.

I have found the exact same thing in Uber drivers -- questions like "How was your day?" are commonplace, and some have chewing gum or other amenities.

I've found Uber drivers (all over the country) to be just the right amount of chatty, and very friendly. Haven't tried Lyft yet.

I haven't used either, but generally competition is good for the consumer. The option to go the competition always makes things better.

The software business tends to like monopolies as the price to build the first one is usually quite expensive but the cost to build each additional one is fairly cheep. That combined with the more people (drivers and riders in this case) use the software the better it gets leads to fewer big companies with more users.

The big difference for me is that Lyft allows you to tip in the app that's very telling.

Yes, especially since I've heard horror stories about Uber drivers one-starring customers for not carrying cash.

I suppose I wonder why I would ever want to pay for a service where I will be rated for my qualities as a consumer of that same service.

I've never heard of anyone tipping an Uber driver. I'm not sure why they'd know if I have cash or not.

Yes, it's very telling that Lyft offers a suboptimal experience.

Not being pressured to carry cash is a suboptimal experience?

I refuse to carry cash. If I were to take Uber, I'd have drivers one-starring me and giving me a bad reputation for not tipping them. With Lyft, I can tip in the app and avoid all that mess.

You're not supposed to tip Uber drivers, that was one of the main selling points of Uber. The fares are higher than yellow cabs to compensate for that.

UberX is cheaper than yellow cabs in NYC/SF, but otherwise correct.

Do you have evidence of this? I didn't think it was possible to find out what drivers rated you and it seems odd that they'd expect a cash tip when the point of the system is that it's cashless.

Here's one: http://www.huffingtonpost.com/entry/uber-driver-complaints-e...

> So we compiled a list of seven things you might be doing to annoy your Uber driver and destroy your rating. Avoid these behaviors to ensure a smooth ride for both you and your driver.

> 2. You don't tip.

From one of the biggest Uber driver blogs: http://therideshareguy.com/should-uber-passengers-tip-their-...

> I often see drivers referring to passengers that don’t tip as ‘cheap bastards’ or ‘pieces of shit’

> As a driver, if tips really are important to you, then you need to educate your passengers about how Uber used to pay a better wage and drivers were ok with not accepting tips and now that rates are lower, more and more drivers depend on tips to make a live-able wage.

Just how would a rider tip?

You're clearly trying to push some pro-tipping agenda, but if all you can cite is a single Uber driver blog (who of course wants you to tip) that's pretty flimsy evidence.

The vast majority of Uber riders do not tip. [1] There's not an expectation that you do (even the driver blog you cited admits that). I don't really know why you're trying to create this perception that it's expected, but it certainly isn't.

[1] http://www.cnet.com/news/to-tip-or-not-to-tip-drivers-that-i...

People tip Uber drivers? I've never done it or seen anyone else do it.

I wanted to once, didn't have any cash.

It was because the guy let me bring my dog (in her large cage) in his van which was definitely a bit beyond normal.

I've taken over a hundred Uber rides and literally never tipped. Nor have I ever had a driver who gave me a bad look for not tipping them. It's not expected and Uber actively discourages drivers from soliciting tips.

For the record, my rating was around 4.5 last time I checked so it doesn't seem like drivers are penalizing me for not tipping.

Not having to do the mental/social gymnastics of tipping is a big feature of the Uber experience for me.

> For the record, my rating was around 4.5 last time I checked so it doesn't seem like drivers are penalizing me for not tipping.

If you were a driver, a rating of 4.5 could get you kicked off the platform. So, yes, drivers are rating you poorly.

> If you were a driver, a rating of 4.5 could get you kicked off the platform. So, yes, drivers are rating you poorly.

Except I'm not a driver. 4.5 is, in any realistic rating system, perfectly fine.

Also, why do I care if you think I'm being rated poorly? It's not like it affects my experience in any way.

personally I'd like to see startups help to move us away from a tipping economy, kind of bummed when they added that

I'd be fine with no tipping if I thought the drivers were being paid reasonably but I don't think they are.

> Uber seems like a company run by pricks

I recently interviewed with Uber in Asia, spoke to a half dozen people there right up to the head of the region and many Americans who have been with the company for years, and I did not get the job (so, clearly not biased towards the company).

Here's my one data point: they were all really nice, professional, competent people I'd actually want to work with. When I say nice, I don't mean polite, but trustworthy and well intentioned.

They are working very hard to cope with the massive growth of their app, trying to figure out how to manage 200 offices in parallel with tiny teams whilst keeping the same quality standards and avoiding unsavoury incidents that come when you hire a large number of people in many locations (imagine what would happen if there was a rape or robbery attempt by an Uber driver). They are under extreme press scrutiny and large amounts of negative PR globally, because they are hitting some of the best organised, most entrenched oligopolies.

Psychologically, it felt like there was a strong sense of family and purpose, that I haven't really seen since I left commodities trading (whose companies are family owned businesses where long careers are common). They were proud of what they were building, genuinely appreciating the value added to the community by their work. The place also felt meritocratic, with people getting expanded responsibility rapidly after proving themselves (based on the career path of the long timers I talked to - could be survivorship bias).

Naturally, I poked a bit towards the "unethical" side of things, suggesting a couple of things as feelers for how they would react. The reaction was overwhelmingly negative - it seems that "dirty tricks" are not looked well in Uber in 2015 at least, fair competition is the name of the game.

So, they impressed me enough as people (after impressing me as a service) that here I am putting up a positive word on HN. I suspect much of the negative press is "black" PR from competitors and threatened interest groups.

Just wondering, do you think the fact that you "poked a bit towards the "unethical" side of things" played any part in you not getting the position?

I wish it was the case (wouldn't that be convenient for my reputation) but it was a more standard culture fit problem, they didn't think we'd work well together. Specifically, the job involved a lot of cross-office coordination and I'm more of a "get the job done", technically focused kind of manager than the more political nature of the managerial role in question (political in the sense that you need to help multiple teams work together harmoniously and efficiently, not House of Cards).

They were quite open with feedback which is another reason I have good feelings towards the company. The whole process was very quick - responses in days. Compared to what my friends tell me about Google's sometimes multi-year process, it's a dream.

I don't know how much I can say about their internal structure but what I found very cool (especially as a former Rocket Internet employee) was their focus on and methods for detecting and spreading knowledge across the entire organisation, which is sort of decentralised even if many important decisions are made in California.

This is something we never got right at Rocket, where companies and regions are much more independent and have wildly differing methods and standards. It was very rare for things to cross over beyond the "startup code" (the PHP e-commerce codebase that is sent over to be deployed when a venture is opened) and some marketing methodology. The other large companies I've been familiar with are better at sharing information, but tend to have a global hub where most of the thinking is done anyway (i.e. knowledge tends to radiate outwards).

Thanks for the insights. Sounds like a fair procedure.

Curious to hear more about what you found cool about their communication methods. I've been thinking about this a lot as I'm surprised how inefficient a lot of Big Corp communication methods can be, especially those with a field/regional organization. Inclined to agree that knowledge radiates outwards, but tinkering with ideas about how to best receive feedback inwards and what are the most effective methods of radiating that knowledge. Easier said than done.

I can't speak specifically about Uber (not sure what is fair to disclose or not) and definitely not about Rocket. However, I can speculate on what I learnt from both. It's not (or not "just") about "communication methods" but an organisational problem.

In the hypothetical case where I'd be running a company like that, I'd want a small team of people who are both technically and operationally extremely able, and personally likeable and politically capable; preferably people who have proven themselves and have credit internally (or such achievements as to reach the same reputation even as an external hire).

I'd task them to overview everything that is happening globally, coordinate trials and experiments so that several hundred could run at the same time globally, and share back information and results across the world. They'd be in effect the repository of knowledge of the company, the institutional memory (so much wheel gets reinvented!) and they most crucially wouldn't be based in HQ in the Bay Area, but a distributed global team constantly roaming and meeting all the local teams. They wouldn't have or need authority to "get things done" by steamrolling over the local office (as the IBM Black Team did [1]), instead convincing them that it's a good idea to try.

They would include specialists in every discipline that is important to the company from finance to statistics, to make sure that there is always at least one team member that can be on the same level as a local specialist (both to avoid taking stupid decisions, and to be credible in conversations).

[1] http://www.t3.org/tangledwebs/07/tw0706.html

> (imagine what would happen if there was a rape or robbery attempt by an Uber driver)

This has already happened: http://www.bbc.com/news/world-asia-india-34578477

They did some really incredible PR on it (adding the "emergency" button, quick dissociation of the driver and the company, etc), and seem to have gotten off basically scot-free in of public opinion.

Yeah, I discussed that incident as well. They are quite quiet about their security efforts for obvious reasons (you don't want to give criminals hints on how to get away with it) but beyond the obvious dissuasive factor of drivers' identities being known, and bad characters being weeded out quickly by the rating, they were looking into things like comparing path taken by the car with the path it should be taking, flagging up rides to be reviewed and rapidly sent help if necessary.

It's a massive step up from what was available with taxis before. I remember when I worked in Mumbai, getting ripped off systematically until my co-workers helped me find "Meru Cool Cabs" which were always on time, professional and charging my non-Hindi speaking, non-Indian looking self by the meter. That, and trying to haggle on a fare with autorickshaws (resulting in 1 in 20 agreeing - the rest wanted 10x) to go home from the Big Bazaar in Vikhroli, and wondering if the shortest path REALLY has to go through that slum. Wish there had been Uber back then.

This is a space where "niceness" matters. Since a lot of it is all about human interactions.

“From a G.M. perspective, we view this as much more of an opportunity than a threat” - G.M President

Something you don't hear big corps talk so about start-ups very often. It's promising.

GM is not in the taxi business and has never been in the taxi business. They see this as a way for manufacturers to get into the taxi business and perhaps one day dominate the taxi business. Cut out all the middle men.

Surely it reduces the total number of cars, though? The vast majority of cars spend most of their time idle. With this model, you could supply the same total need with many fewer vehicles. Unless GM owns the whole fleet and Jacks up the price, losing that much demand strikes me as pretty rough.

Better to capture the biggest share of the smaller pie than to ignore the sea change. Blockbuster ignored a similar shift bcause it wasn't as profitable.

Plus the downshift won't be as great as some predict. You'll still need enough cars for long commutes. And cars lifespan are measured in miles not years. Autonomous cars might actually increase the number of miles driven (commute while sleeping, alternative to public transit, or driving instead of flying).

A car sitting in a driveway will last longer than one doing stop and go traffic 23 hours a day.

A car sitting in a driveway will last longer than one doing stop and go traffic 23 hours a day

The single most obvious point that everyone seems to be ignoring!

I can't see the opportunity for them, on the other hand I can see the threat, if autonomous cars become ubiquitous then why would you bother owning your own?

Also if rental becomes the dominant model then customers aren't going to worry so much about those expensive extras where car manufacturers make their profits.

Even if all cars are self driving, these cars have to come from somewhere. The rental model may in the end provide more profits, because it has built-in repeated charges.

> these cars have to come from somewhere.

yes, but think how much the average car owner uses the non-self-driving car today. The car mostly sits idle in a garage or parking spot, and is used, maybe 75 minutes of each day.

Multiplexing riders into a pool of shared cars is one way to drastically reduce the worldwide fleet of cars. a larger proportion of total cars will be moving at any one time to transport the same number of people, which means you need fewer cars overall. It will be attractive to today's car owners because it reduces costs.

to the extent that self-driving cars enable shared pools of on-demand vehicles, the innovation represents a huge disruption for the auto manufacturers who've built a business model on selling everyone a car.

> The rental model may in the end provide more profits,

Sure there is a business opportunity, but the change is disruptive.

The next 5-10 years is the time to stock up on popular sports cars and garage them to sell them as highly prized, super rare, trackable luxuries.

>autonomous cars become ubiquitous then why would you bother owning your own?

Anything requiring a truck (60% of new vehicle sales) will not be something that you use as a automated vehicle that is for rent. You really are ok with ordering up a driverless car that I will take off-road and load up with scrap materials from a house remodel and send off, driverless down the road with my trash hanging out the back?

I really love the idea of driverless cars and I can see the stars in the tech worlds eyes. Be realistic about what your average American does with a vehicle though - it's not a daily commute up and down sandhill road to sit in a nice office.

Most people aren't hauling scrap, either. And of course there could be autonomous solutions for that. If you don't have to own the truck, you could more easily get some sort of enclosed vehicle (like a box truck or small dump truck) to do the hauling, because your investment is very small (you only need it for a few hours or days).

Why would the autonomous vehicle I rent for a commute ever be the same one you use to load up with refuse from your home remodel?

Wouldn't it make way more sense for you to rent (or own) a pickup truck and for me to rent an autonomous passenger vehicle?

Setting autonomous vehicles aside, current short-term car rental companies (i.e Zipcar) have requirements on the condition you return a passenger vehicle in, vs a cargo/hauling vehicle.

I've rented a Zipcar pickup truck to haul a load of concrete pavers, but I wouldn't try to do the same in one of their regular passenger vehicles.

There should be a sufficiently large market for both use cases that there should be limited sharing of vehicles between them.

Imagine if you owned 10 rental properties, were a plumber, an electrician, a basketball coach or had almost any job other than something in the tech industry. You would use your truck/van/large SUV for hauling trash, wire, sports equipment, etc.

You would laugh at the idea of selling your primary transport and using an uber/lyft every day to transport all your equipment. Every time one shows up or drops off, remove and replace all your tools/gear. The wear and tear on these vehicles is greater than a small commuter.

Just because you rented a truck once to move gardening supplies makes you anomalous. Most people who want to do that kind of work/hobby own a vehicle that allows them to transport these things with ease.

We haven't even gotten into the aspect of children. Imagine remove/replace every day on a child car seat from a rental.

Most people I know who work in the trades own the vehicle as part of their business, and have separate passenger car(s) for hauling family.

The vehicle subscription would replace the passenger car, not the truck used for heavy work, not at the least because the depreciation of the work vehicle is deductible as a business expense. Also, a vehicle actively used for construction work is already heavily utilized (it is hauling/holding stuff most of the day), so it makes more sense to own it. Passenger cars, however, sit idle most of the day in a parking lot or your driveway, hence their low utilization / wasted value.

Also, many cars today have built-in car-seats (https://www.cars.com/articles/2014/05/which-vehicles-offer-i...). You can bet this sort of feature will be more common in autonomous vehicles.

Furthermore, in certain Uber markets today, you can pay an extra fee to get a vehicle with car seats pre-installed. Right now that fee is high ($10/ride) because they're the only ones doing it, but it's a service so easily replicated that the price will surely come down.

If 60% of the fleet is trucks and trucks are rarely purchased for explicitly moving humans and instead purchased for the moving of things.

Rideshare already only has 40% of the market to convince to sell their car and perpetually rent on demand. What's the conversion rate of that 40% who could use the on demand service for moving humans? 50%? That's not a massive pile of customers.

Built in car-seats are almost a mirage, they are wildly uncommon. The premise still remains, overwhelming majority of people will not want to abandon a personally owned vehicle for some on-demand car that arrives and some varying condition and layout that you have to load/unload every time with your things.

Try it for a week if you drive, take your car charger/paperwork/sunglasses/whatever in and out of the car every time you park. That alone will sell you on private ownership.

> Rideshare already only has 40% of the market to convince to sell their car and perpetually rent on demand. What's the conversion rate of that 40% who could use the on demand service for moving humans? 50%? That's not a massive pile of customers.

Assuming that your estimate 50% of non-truck owners adopting it is correct, that's 20% of 253 million cars, which is 50 million. Seems massive to me.

> Built in car-seats are almost a mirage, they are wildly uncommon.

What makes you think that they won't become more common (especially among car service vehicles) if there is a strong demand for them from car subscription services? It's not like it's a complicated technology to add.

> The premise still remains, overwhelming majority of people will not want to abandon a personally owned vehicle for some on-demand car that arrives and some varying condition and layout that you have to load/unload every time with your things.

I'm not sure how you can be so sure of your prediction of future demand, especially when technology is changing so fast.

Regarding the particulars you mention, I already load/unload my private car with stuff, but 90% of the time, it's just me and my backpack.

Sure, you can't use a rented vehicle as paperwork storage, but why would one use a car for storing paperwork?

Chargers can be provided in the rental vehicle (just like Starbucks does).

> Try it for a week if you drive

I routinely take the train (with the kids and all their gear), and we have to naturally take everything we brought with us when we get off. If anything, the rental car scenario is more convenient than that.

This is exactly where they start to loose, why pay the premium for a feature you only use occasionally?

The car industry has spent a fortune developing the concept of the car as a status symbol, the idea that you need a truck to haul stuff, a big V8 to prove you are a suitable mate, an executive saloon to show your well up the corporate ladder.

The taxi industry hasn't done this and couldn't, utility trumps status when you are cold and wet and waiting for a ride.

The analogy I like to make is lawnmowers. Whether cheap push mowers, or top of the line zero-turn riding mowers, almost all homeowners own at least one. It would seem to make sense to rent. After all, it's used at most a few hours a week, at predictable times and intervals, and the initial cost (and maintenance) can be significant: a good ZTR can be upwards of $10k.

But almost no one rents a mower. Why not? Is it possible that the convenience is worth paying for,even if it can be delivered to your door? Is it that knowing that it's ready for use exactly when you need it is important? You'd think a few people in each neighborhood would just do a group buy into a high-end mower that could do the job in half the time and they'd all share it. This rarely happens (only time I've seen this behavior is farmers sharing expensive equipment).

My gut tells me the self-driving/car sharing revolution is going to take a bit longer than HN expects.

It's similar to Amazon viewing the Kindle as an opportunity.

If you aren't in a position to prevent innovation from happening then you may as well be the leader of said innovation.

Just like Apple is happy for iPad sales to eat into MacBook sales, however I don't see GM as being the type of organisation able to pull this off.

I like Lyft quite a lot as a company. However, partnering with another company is often a bad sign. It means Lyft needs more cash and isn't able to innovate enough on its own to survive in the market. Additionally, $500 million to "work on developing a so-called autonomous on-demand network of self-driving cars" is a demoralizing statement. 500m is not enough to complete this goal, especially for such a large company as General Motors. From the uninformed sidelines, I predict this is a hail mary pass with a minimal chance of success and long term support.

True, it's not enough to complete the goal, but it might be enough to get started with a pilot program in a city or two in order to test the waters and gauge its potential.

Do you even _know_ how much money Uber has raised so far? Lyft is already being outspent by Uber in many aspects. It's not that Lyft doesn't have proper market fit, it's that Uber has raised megatons of cash.

The last time GM invested in companies that competed with private ownership of cars, it didn't go too well... https://en.wikipedia.org/wiki/General_Motors_streetcar_consp...

Perhaps it went right to plan.

If you are surpised that GM might invest in Lyft, remember that Daimler AG (a.k.a. Mercedes & friends) OWNS Car2go.

While I believe that the future of transport will involve a mixture of self driving vehicles and mass-transit (also potentially self-driving) we need to remember that this problem is being attacked from many angles.

Right now in many large cities we ALREADY have a mixture of:

Car ownership, human transportation (walking, biking), mass transit, car sharing (Zipcar, Car2go, Getaround), and finally RIDE sharing (Uber, Lyft).

I would actually argue that car-sharing services might be some of the first to use fully-autonomous driving technologies. Imagine Zipcar getting a permit to use self-driving cars on certain known routes between their pods, or to go for maintenance/refuelling. Uber and Lyft will be among the last to use fully-autonomous technology because they already have somebody getting PAID to drive and they have the widest area to cover.

I think GM is wasting their money. The talented engineers in this space are flocking to Tesla, Google and soon-to-be Apple.

This can change imo, lyft still hasn't got a bad reputation (I live in SF and have never heard neither good or bad things about being an engineer there).

Engineer culture is complex and moving, and I believe just a few very good/bad decisions can tip the scale either way.

Who the heck wants to enter the GM tech culture?

It's an investment and probably a board seat. I doubt GM is going to interfere with their day to day engineering decisions.

From the article:

> Daniel Ammann, president of G.M., will join Lyft’s board of directors.

Given that those talented engineers were not trained de novo by any of those companies it is a fair bet that they joined for a potential upside and could be bought by Lyft+GM under the right circumstances. There were people willing to actually go work for Uber in this space so, obviously, anything is possible...

What happens when the first person gets killed while riding in an autonomous vehicle? Do companies who make them get sued into oblivion? Will customers stop riding in them regardless of whether or not statistics suggest they are safer than traditional cars?

Brilliant. Concierge drivers consume very new cars, decreasing use of older ones thus driving GM sales.

They also eat the lunch of the other car manufacturers, simultaneously lowering near term and future sales.

And for lyft, it gives a more adaptive workforce - say there's increase in demand for SUV's - the workforce can more easily adapt.

That seems like an important thing when you look at uber's recent UberHop experiment - using SUV's as small ,almost on-demand mini buses for quite cheap. this looks like something that can grow very rapidly.

GM needs more sales? Suddenly they mandate every Lyft driver have a 2-year-old or newer GM vehicle...

Everyone is relating this mostly to autonomous vehicles. I think this might take uber/lyft straight out of the game.

Ubers advantage/most is the network. Its hard to beat a network advantage. They are installed and plugged into a lot of people's creditcredit cards. That works just as well for self driving cars. But the advantage of the driver network is straight out the door if autonomous vehicles replace humans. Networks become a much easier problem to solve.

I don't see it happening within 10 years but if I we're uber or lyft I wouldn't want to.

I don't get how the driver network has any value. I see all the value in the passenger network. Of course Uber wants self-driving cars to happen.

Not to hijack, but how do we stop esentially duplicate URLs in "new" see (http://mobile.nytimes.com/2016/01/05/technology/gm-invests-i...) not matching?

The subdomain is probably the issue. Suggest updating it to strip out subdomain, query string, hashes etc and do a domain and path comparison. Too many sites have a mobile subdomain with the rest of the domain the same.

Also, sites like NYTimes add different URL parameters based on how you arrived at the article (eg, which menu item you clicked). I strip those out when submitting to HN, but others might not, so HN views it as a different URL.

use the canonical url defined in the html (<link rel="canonical" href="http://www.nytimes.com/2016/01/05/technology/gm-invests-in-l...

https://en.wikipedia.org/wiki/Canonical_link_element

Maybe fetch the url and look at the <link rel="canonical"> tag?

Interesting idea to have the short term car rental. I assume this will include proper insurance which I think is one of the big 'hidden costs' that these services aren't covering.

Very good way for Lyft to increase the amount of drivers on their network without people having to finance vehicles of their own (which isn't worth it unless you drive a lot for them).

This kind of leaves a sour taste in my mouth, seeing as GM took an 11 billion dollar government bailout. Should they really be allowed to make speculative bets in a highly competitive market, where the market leader (Uber) essentially has unlimited capital? Isn't this the kind of stuff that got GM into trouble?

It's interesting to see how the aggressive tactics of Uber are affecting the automotive industry. Companies are partnering which would have never even talked to each other previously. I'm very curious to see how this whole thing plays out.

I'm wondering if this an IP raid by GM. A couple of terms of the deal are that GM gets a seat on the board (for $500m, I would expect so) and access to Lyft's software. The latter might be the important part to GM.

With the decline of car ownership, a huge loss in jobs wills follow.

To me, one of the biggest long-term problems the U.S. faces is the rising gap between the rich and poor. Unfortunately, SDRs will only widen this.

So, can we say that this is the moment when taxi industry and car production industry are officially starting to turn into a single unified transportation industry?

This can be Alibaba of GM as after few years majority of GM's market cap will be due to their stack in Lyft.

It's either a vote of confidence in Lyft or a desperate attempt to stay relevant.

Why do you think GM invested in Lyft rather than Uber?

In my experience, Uber is more established, well-respected, leading the ride-sharing movement. Why would GM partner with the seemingly second-place horse in the race?

Uber's price might have been too steep. They probably think they don't need GM.

Ugh, self driving cars, but SHITTY self-driving cars. Of course.

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