Self-driving cars are a long game until companies can bring down the costs. It might be years before that happens. Uber has the advantage of being able to ramp up self-driving cars as part of their existing fleet until then.
[1] https://qz.com/924212/what-it-really-costs-to-turn-a-car-int.... [2] https://www.uber.com/newsroom/company-info/
Edit: math mistake
“Waymo, the Google spin-off, claims it has cut the cost of an experimental version of the high-end LIDAR to around $7,500. It did not release details”
More details here: https://arstechnica.com/cars/2017/01/googles-waymo-invests-i...
https://arstechnica.com/cars/2018/10/lone-engineer-spanks-wa...
It can possibly serve two effective shifts (in fact longer than that but the demand at some hours could be lower and it may need some time to charge, unless battery swapping is performed), which means the cost per shift is only $30k per year which could be in the same ballpark or a bit lower than a human driver would make per shift (depending on the market it serves, etc.)
This is just the beginning though and the costs will most likely come down while the human driver's costs will likely go up.
It might require moving to the Tesla camera-only approach to bring down costs enough to make self-driving cars viable. But that technology is still nowhere near there.
High-precision accelerometers used to be extremely expensive, with the best having prices in the high 5 figures. Then companies started putting (initially really crappy) accelerometers into smartphones, just to know which side is up. Then economies of scale hit and suddenly every smartphone has an accelerometer better than those super-expensive ones, and cost per part is pennies. (And then drones became a thing.)
The same will happen with LIDAR. Nothing about any of the parts of a self-driving car requires it to be super expensive, it's just that things that are made in quantity are cheaper than special snowflake parts.
Also, if we assume the cost of a self-driving car is 250K, that might seem like a lot, but if you amortize it over 5 years, that's 50K a year. Assuming that a car can bring in a mean profit of $10 per ride, that means it has to do 13.7 rides a day for 5 years to break even. That might seem high, but these cars are not human drivers, they don't need to sleep or take breaks, they could be on the road 20-23 hours a day, leaving some time for refueling and maintenance. I think it would be possible to bring in a profit with $250K self-driving cars and an uber-equivalent price points. It will become even easier when these cars drop to 200K, 150K and 100K, which is certain to happen once the technology spreads.
It’s brand suicide to not have a car when needed so fleets will be sized for peak load. When you apply queuing theory none of the numbers seem to add up.
If an advertiser tried to entice people to place a tracking device in their cars today for a reward, that would go over like a lead balloon. But Waymo will get people to pay for the tracking data and enjoy the riding convenience, while vacuuming up insights into consumer behavior at granularities that are the story elements of Black Mirror episodes. Advertisers are salivating at sending targeted offers that add pinpoint location and time to the axes they can already select upon.
While a teeny bopper rides, the screen screams out a BOGO offer to buy “the latest Kardashian shoe just 10 meters from your destination, press the Buy It Now button in the next 30 seconds and we’ll have both shoes ready for you in your size for immediate pickup at our entrance including a FREE gift $100 value for true Kardashian collectible fans! BE Kardashian Glamorous Tonight!”
We all love the on-demand, single rider model that Lyft pioneered, but it also isn't sustainable with traffic demands increasing every year with population. Machine learning and productive partnerships with city traffic officials will ensure buses are routed on sensible routes that could be changed with demand without inconveniencing riders. Strictly protected bus lanes would also simplify the programming needed to maneuver a self driving vehicle through traffic.
Google can price a similar trip at $7, saving the rider $3 and boosting the revenue by $2 to $4.50.
Yes, some of the attraction is a price that undercuts taxis. I often take a Lyft to and from the airport in a city I visit fairly frequently. But literally the only reason I do that rather than take a taxi of some variety is that it's 30-40% cheaper.
However, in many cases, Uber/Lyft are indeed easier to use than the alternatives. Not always--I take a private car back and forth to the airport at home--but under many circumstances.