I think the odds that Uber would make money developing self driving cars was approximately zero. Look where Tesla Motors is after fourteen years in terms of producing and selling automobiles and without internal competition from another primary line of business.

Self driving vehicles will have the same profile as the existing automotive industry: high capital costs and commodity margins. The existing automotive mega-corporations already have the capital investment and distribution networks like ships and rail cars and lots and auto-carrier semi-trailers. Tesla is building some of that and the jury is still out on whether Tesla will make a meaningful dent.

Even the idea of Uber rolling out a self-driving fleet means a massive infusion of capital that is at odds with its current cost structure. And the existing automotive mega-corps can step into the ondemand business with a cost advantage in regard to rolling out vehicle fleets.