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The Electric Car may be entering its "cell phone" period

I’ve been electric car shopping, but one thing has stood out as a big concern. Many electric cars are depreciating fast, and it may get even faster. I think part of this is due to the fact that electric cars are a bit more like electronics devices than they are cars. Electric cars will see major innovation in the next few years, as well as a decline in their price/performance of their batteries. This spells doom for their value. It’s akin to cell phones — your 2 year old cell phone still functions perfectly, but you dispose of it for a new one because of the pace of innovation. Electric cars are not at that pace, but they are skirting the phenomenon.

When it comes to Robocar, I remind people that the computer will be the most important part of the car, not the engine or other features. And the computer and software are on the Moore’s Law curve, like your phone. The battery system is not like this, but digital features are becoming more and more important parts of every car.

The most obvious cause of the big depreciation is not related to the cars. There is a $7500 federal tax rebate on a new electric car, so the moment you drive it off the lot, its blue book value drops an additional $7500. In addition, different states offer credits from of up to $5,000, and unless you take the car out of state, that amount will also drop off the value. This is the primary culprit for the huge depreciation numbers, but there is more.

Perversely, people with higher incomes don’t get California’s $2,500 credit, so for them, buying used is a very wise idea, because somebody else got the credit, and it’s reflected in the price of the car. Of course, if you are rich enough, you may tolerate paying $2,500 more than everybody else for the new car. In fact, if not for the sales tax, it would be a good strategy to get somebody else to buy a car for you and get the credit, then buy it from them. Or take over a lease (getting to that…)

There are rumours that vendors might even be trying to subsidize against this depreciation to avoid a collapse in the price of their cars. After all, such low used car value discourages confidence in the car (and steals away buyers of new cars.) Rumours suggest Nissan has been known to offer incentives to get people to keep their lease-returns rather than take them back, and there are stories of even Teslas getting low prices at auction, though in the retail market they have actually done pretty well.

The Leaf is the most popular electric car, and only it and the Tesla are real market cars from big players. The other cars are all “compliance” cars, made by companies who must meet quotas of green vehicles. The 2015 Leaf has a cited range around 80 miles, and users report a real range on the highway closer to 60 miles. For me, that means a car that can’t take me to San Francisco and back. The Leaf would handle a large fraction of my trips around Silicon Valley, but not being able to go to SF is a major detriment in this town. So I decided not to get a 2015 Leaf.

Better cars keep getting pre-announced

That decision was magnified when Nissan announced the 2016 Leaf would be able to do 107 miles. Technically, that’s enough for the San Francisco trip, though in reality it’s just on the edge. Any charging would allow the trip, including a 5 minute (“gas pump” level) stop at a DC supercharger (if nobody else is using it.) So I was waiting for that car to come out when…

They announced the Chevy Bolt, a $30K car (after rebate) with a 200 mile range. Finally a reasonably priced car with enough range. And then rumours circulated of a similar range in the 2017 Leaf — it needs to if it will compete, and so every other car needs to as well. Who will buy a 100 mile 2016 car when a 200 mile 2017 car for not much more is being promoted?

Of course, in a year, something even more appealing than the Bolt will be announced. While the Bolt’s range is enough for 99% of my drives (leaving out only Lake Tahoe and road tripping) there is still much that can improve — other parts of the car, the electronics, and of course the battery pack getting even cheaper at that range.

Every year, cars get a little bit better, but we’re in for a period of about 5 years in electric cars where each new year is a lot better, and that’s trouble for people trying to sell them if the customers figure that out. A cell phone is cheap enough to throw out after 2 years. A car is not. To top it off, in a few years the robocar features will start getting more serious (starting with the first no-supervision traffic jam assist) and so other parts of the car will also be on the Moore’s Law curve.

The battery is probably not on that curve, but it’s on a good one. The Bolt’s 200 mile range is a result of an expected reduction of battery cost from $500/kwh a couple of years ago to $200/kwh by 2020, and that’s without any breakthroughs or new chemistry. (It is speculated the Bolt’s battery cost will already beat that $200 number.) Breakthroughs — which sometimes come when enough money is pushing the process — could easily do much more.

Robocar answer

Robocars have an answer to this rapid depreciation. If they are used as Taxis, they can survive. The typical New York Taxi drives 62,000 miles each year and wears out in 5 years. Personal cars take 19 years to wear out, and go around 200,000 miles. Robotaxis will wear out and be scrapped after just 5 years, which means it is less of a burden when they are 4 years old and obsolete from a technology standpoint. (We may also design these vehicles to make it easy to give them hardware upgrades so their electronics can keep pace.)

Personal robocars have it harder. Your 4 year old personal vehicle is going to look like crap compared to the new ones. It will get software updates to match them (which is vital) but without hardware updates it will, like an old iPhone, no longer even be able to handle the software updates. If you buy a personal robocar, get one where it’s easy to swap out the hardware, and expect to pay the cost of this.

Wear and tear of electric cars

The battery is the lifeblood of the electric car. No matter how new the rest is, a reduced range is a deal-killer for most buyers. Indeed, some predictions say the rest of the power train should wear out more slowly than traditional cars, so the depreciation is unfair in some ways.

Battery swap is an option on some electric cars, but that’s a big cost to pay over what you planned to pay. Older battery packs will still work, but deliver less range. Owners will salivate for new packs that are cheaper, lighter, fresher and possibly even higher capacity than what they have. That’s all good, but if you buy an electric car with a pack only good for 4 years at today’s prices, you’ve lost all the economies the electric car hopes to give you. Of course, robocars and especially robotaxis can manage their batteries for much longer life

It might make sense to buy a 2012 Leaf for $8,000 and pay $5K to add a battery pack to it that’s brand-new, giving you a car close to matching a new one in certain ways.

With all this, why look at electric cars today? For me, my electricity bill would actually go down due to metering differences, and of course my gasoline bill would drop too. And they are zippy and fun to drive and quite green with California’s (relatively) green energy grid. And because of this depreciation, used ones are a major bargain. The buyers of new cars (and the federal government) took the hit on a new electric, but you can pick up a 2012 Leaf for $8,000. That’s because all those 2012 units are coming off their leases, and people want them a lot less with those fancier models out there. (In addition, it is known the 2012 had some battery life issues fixed in 2013.)

A lot of people are leasing electric cars. Leasing has one financial advantage (you pay sales tax only on the depreciation you take, rather than the whole car) and otherwise it’s a bad idea unless you’re sure the vendor has guessed badly on the residual value of the car after the lease. With electric cars, you take so much of the depreciation that the tax advantage is not so great. But many electric owners are leasing. The $2500 tax credit in California can often pay for the downpayment, making it easy to come up with the money, and owners are, with good reason, willing to let the vendor take the risk on battery decay and mega-depreciation. Vendors are not idiots, though, and so their residual values are low, but perhaps not low enough. Of course, if you know better cars are coming and are sure you only want the car for 2 years, leasing can ease your legwork.

On the other hand, you can sometimes take over the lease of another electric car owner, letting them suffer the “due at signing” downpayment (which often exceeds all the monthly payments on a short lease) and giving you a car for a very short time, which might be a wise choice with all the new vehicles coming down the pipe.

Maintaining Privacy in the Robotaxi

While I’ve been in love for a long time with the idea of mobility-on-demand and the robocar taxi, I continue to have some privacy concerns. The first is simply over the idea that a service company gets a map of all your travels. Of course, your cell phone company, and companies like Google with their Location History (Warning, don’t click or you will be freaked out if you didn’t know about this) know this already, as does the NSA and probably all the other spy agencies in the world. That doesn’t make it much better to add more trackers. The online ride companies like Uber are tracking you too.

It will be sad to lose the anonymous taxi we used to have, where you hailed a cab and paid in cash and no record was made (until cabs got tracklogs and video) of your travels. In my article on Robocars and Privacy written many years ago I outlined some plans for anonymous taxi service and I continue to push this idea.

In the article, I outline the concern that a taxi company will want to be able to photograph the vehicle when you’re not in it, to assure you haven’t dirtied or damaged the interior, and also to check if you left something in the vehicle by accident. People will be less comfortable with a camera that can be turned on all the time, and LEDs to inform you if a camera is on can’t really be trusted, so we want to have a physical shutter.

This led me to a simple solution: The physical shutter on the camera could be the switch by which you signal the start and end of a ride. The ride can’t begin until you close the physical shutter, and it doesn’t close out until you open it. You want a lever for the shutter on the outside of the car by the main passenger door, so you can open and close it when you are not in the car, so it doesn’t take a picture of you if you are trying to use an anonymous taxi. A connected lever inside could allow people who are not trying to be anonymous (but rather just private on their journey) to both control the shutter, and signal the car to go or conclude the ride.

You might not want to be inside when it takes the photo anyway, because a bright flash would be advised, for a millisecond brighter than the sunlight coming in the car. That way the images will be under the same light, night or day, making it easy to compare before and after images to detect dirt or lost items.

If you leave the car without opening the shutter, it would honk at you, or ding on your phone to remind you to come back and open it.

Cars will likely have some other cameras too, for video conferencing. I expect video conferences to be popular in robocars, and while your own phone can do that for you, a camera with stabilization in it could be a useful idea. Here, we could use a physical shutter, though this time with a remote actuator that makes noise, so you can easily see if it’s open. Even more simply, the video camera and monitor might not connect to anything in the car, but rather only connect to your phone via a car dock. (The connection must be wired, unfortunately.) If the camera is not connected you can be reasonably confident it’s not spying on you.

Of course, a truly malicious operator could have hidden cameras, or a secret connection to the video conference camera, but there’s not to much you can do about that. What we want protection from are attackers breaking into the car’s system, and vendors who change their mind about your privacy. We also want a stake in the ground that routine surveillance of passengers is not acceptable.

Federal government involvement

NHTSA, the federal car safety agency has been talking about getting into the robocar game for a while, and now declares it wants more involvement with two important details:

  • Unlike California, they are keen on making sure full robocars (able to run unmanned) are part of the regulations, and
  • Their regulations might supersede those of states like California.

In the next six months, the DoT will work with states and others on a unified policy. There are some other details here.

(California, by the way will have hearings in the next couple of weeks on their regulations. I will be out of the state, unfortunately.)

On top of this there is a $4 billion (over 10 years) proposal in the new Obama budget to support and accelerate robocars and (sadly) connected cars.

Perhaps most heartening is a plan to offer reduced regulation for up to 2,500 early deployment vehicles — a way to get companies out there in the field without shackling them first. Public attitudes on robocars have pushed regulators to a rather radical approach to regulation, namely attempting to define regulations before a product is actually on the market, with California even thinking of banning unmanned cars before they arrive. In the normal history of car safety regulation, technologies are built and deployed by vendors and are usually on the road for decades before they get regulated, but people are so afraid of robots that this normal approach may not happen here.

GM Delays super-cruise again

There was a fair bit of excitement when Cadillac announced “super-cruise,” a product similar to what you see in the Tesla autopilot, for the 2014 model year, or so we thought. It was the first effort from a big car company at some level of self-driving, even if minimal. Since then, they’ve kept delaying it, while Mercedes, Tesla and others have released such products. Now they have said it won’t show until at least 2017. GM is quickly dropping in the ranks of active Robocar companies, leaving the U.S. mantle to Tesla and Ford. Chrysler has never announced anything an even ran anti-self-driving-car ads in the Superbowl a few years ago.

Tesla releases “summon” and hints at more

The latest Tesla firmware release offers a “summon” function, so you can train your car to park and come back to you (with a range of 39 feet.) Primary use is to have your car go park itself in the garage, or at a robotic charging station. This didn’t stop Elon Musk from promising we are not very far away from being able to summon the car from very far away.

They have also detailed that those sorts of functions, and other autonomy, will require more sensors than they put in the model S, and that this sensor suite is a few years away, perhaps in time for the model 3

But wait, there’s more…

The pace of news is getting fast. Even I’m having trouble keeping up with everything even though it’s part of my job. This blog will continue to be a place not for all the news, but the news that actually makes a difference, with analysis.

Here are some other items you might find of interest:

Google releases detailed intervention rates -- and the real unsolved problem of robocars

Hot on the heels of my CES Report is the release of the latest article from Chris Urmson on The View from the Front Seat of the Google Car. Chris heads engineering on the project (and until recently led the entire project.)

Chris reports two interesting statistics. The first is “simulated contacts” — times when a safety driver intervened, and the vehicle would have hit something without the intervention:

There were 13 [Simulated Contact] incidents in the DMV reporting period (though 2 involved traffic cones and 3 were caused by another driver’s reckless behavior). What we find encouraging is that 8 of these incidents took place in ~53,000 miles in ~3 months of 2014, but only 5 of them took place in ~370,000 miles in 11 months of 2015. (There were 69 safety disengages, of which 13 were determined to be likely to cause a “contact.”)

The second is detected system anomalies:

There were 272 instances in which the software detected an anomaly somewhere in the system that could have had possible safety implications; in these cases it immediately handed control of the vehicle to our test driver. We’ve recently been driving ~5300 autonomous miles between these events, which is a nearly 7-fold improvement since the start of the reporting period, when we logged only ~785 autonomous miles between them. We’re pleased.

Let’s look at these and why they are different and how they compare to humans.

The “simulated contacts” are events which would have been accidents in an unsupervised or unmanned vehicle, which is serious. Google is now having one once every 74,000 miles, though Urmson suggests this rate may not keep going down as they test the vehicle in new and more challenging environments. It’s also noted that a few were not the fault of the system. Indeed, for the full set of 69 safety disengagements, the rate of those is actually going up, with 29 of them in the last 5 months reported.

How does that number compare with humans? Well, regular people in the USA have about 6 million accidents per year reported to the police, which means about once every 500,000 miles. But for some time, insurance companies have said the number is twice that, or once every 250,000 miles. Google’s own new research suggests even more accidents are taking place that go entirely unreported by anybody. For example, how often have you struck a curb, or even had a minor touch in a parking lot that nobody else knew about? Many people would admit to that, and altogether there are suggestions the human number for a “contact” could be as bad as one per 100,000 miles.

Which would put the Google cars at close to that level, though this is from driving in simple environments with no snow and easy California driving situations. In other words, there is still some distance to go, but at least one possible goal seems in striking distance. Google even reports going 230,000 miles from April to November of last year without a simulated contact, a (cherry-picked) stretch that nonetheless matches human levels.

For the past while, when people have asked me, “What is the biggest obstacle to robocar deployment, is it technology or regulation?” I have given an unexpected answer — that it’s testing. I’ve said we have to figure out just how to test these vehicles so we can know when a safety goal has been met. We also have to figure out what the safety goal is.

Various suggestions have come out for the goal: Having a safety record to match humans. Matching good humans. Getting twice or even 10 times or even 100 times as good as humans. Those higher, stretch goals will become good targets one day, but for now the first question is how to get to the level of humans.

One problem is that the way humans have accidents is quite different from how robots probably will. Human accidents sometimes have a single cause (such as falling asleep at the wheel) but many arise because 2 or more things went wrong. Almost everybody I talk to will agree a time has come when they were looking away from the road to adjust the radio or even play with their phone, and they looked up to see traffic slowing ahead of them, and quickly hit the brakes just in time, narrowly avoiding an accident. Accidents often happen when luck like this runs out. Robotic accidents will probably mostly come from one single flaw or error. Robots doing anything unsafe, even for a moment, will be cause for alarm and the source of the error will be fixed as quickly as possible.

Safety anomalies

This leads us to look at the other number — the safety anomalies. At first, this sounds more frightening. They range from 39 hardware issues and anomalies to 80 “software discrepancies” which may include rarer full-on “blue screen” style crashes (if the cars ran Windows, which they don’t). People often wonder how we can trust robocars when they know computers can be so unreliable. (The most common detected fault is a perception discrepancy, with 119. It is not said, but I will presume these will include strange sensor data or serious disagreement between different sensors.)

It’s important to note the hidden message. These “safety anomaly” interventions did not generally cause simulated contacts. With human beings, the fact that you zone out, take your eyes off the road, text or even in many cases even briefly fall asleep does not always result in a crash for humans, and nor will similar events for robocars. In the event of a detected anomaly, one presumes that independent (less capable) backup systems will immediately take over. Because they are less capable, they might cause an error, but that should be quite rare.

As such, the 5300 miles between anomalies, while clearly in need of improvement, may also not be a bad number. Certainly many humans have such an “anomaly” that often (that’s about every 6 months of human driving.) It depends how often such anomalies might lead to a crash, and what severity of crash it would be.

The report does not describe something more frightening — a problem with the system that it does not detect. This is the sort of issue that could lead to a dangerous “careen into oncoming traffic” style event in the worst case scenario. The “unexpected motion” anomalies may be of this class. (As such would be a contact incident, we can conclude it’s very rare if it happens at all in the modern car.) (While I worked on Google’s car a few years ago, I have no inside data on the performance of the current generations of cars.)

I have particular concern with the new wave of projects hoping to drive with trained machine learning and neural networks. Unlike Google’s car and most others, the programmers of those vehicles have only a limited idea how the neural networks are operating. It’s harder to tell if they’re having an “anomaly,” though the usual things like hardware errors, processor faults and memory overflows are of course just as visible.

The other vendors

Google didn’t publish total disengagements, judging most of them to be inconsequential. Safety drivers are regularly disengaging for lots of reasons:

  • Taking a break, swapping drivers or returning to base
  • Moving to a road the car doesn’t handle or isn’t being tested on
  • Any suspicion of a risky situation

The latter is the most interesting. Drivers are told to take the wheel if anything dangerous is happening on the road, not just with the vehicle. This is the right approach — you don’t want to use the public as test subjects, you don’t want to say, “let’s leave the car auto-driving and see what it does with that crazy driver trying to hassle the car or that group of schoolchildren jaywalking.” Instead the approach is to play out the scenario in simulator and see if the car did the right thing.

Delphi reports 405 disengagements in 16,600 miles — but their breakdown suggests only a few were system problems. Delphi is testing on highway where disengagement rates are expected to be much lower.

Nissan reports 106 disengagements in 1485 miles, most in their early stages. For Oct-Nov their rate was 36 for 866 miles. They seem to be reporting the more serious ones, like Google.

Tesla reports zero disengagements, presumably because they would define what their vehicle does as not a truly autonomous mode.

VW’s report is a bit harder to read, but it suggests 5500 total miles and 85 disengagements.

Google’s lead continues to be overwhelming. That shows up very clearly in the nice charts that the Washington Post made from these numbers.

How safe do we have to be?

If the number is the 100,000 mile or 250,000 mile number we estimate for humans, that’s still pretty hard to test. You can’t just take every new software build and drive it for a million miles (about 25,000 hours) to see if it has fewer than 4 or even 10 accidents. You can and will test the car over billions of miles in simulator, encountering every strange situation ever seen or imagined. Before the car has a first accident it will be unlike a human. It will probably perform flawlessly. if it doesn’t, that will be immediate cause for alarm back at HQ, and correction of the problem.

Makers of robocars will need to convince themselves, their lawyers and safety officers, their boards, the public and eventually even the government that they have met some reasonable safety goal.

Over time we will hopefully see even more detailed numbers on this. That is how we’ll answer this question.

This does turn out to be one advantage of the supervised autopilots, such as what Tesla has released. Because it can count on all the Tesla owners to be the fail-safe (or if you prefer, guinea-pig) for their autopilot system, Tesla is able to quickly gather a lot of data about the safety record of its system over a lot of miles. Far more than can be gathered if you have to run the testing operation with paid drivers or even your own unmanned cars. This ability to test could help the supervised autopilots get to good confidence numbers faster than expected. Indeed, though I have often written that I don’t feel there is a good evolutionary path from supervised robocars to unmanned ones, this approach could make my prediction be in error. For if Tesla or some other car maker with lots of cars on the road is able to make an autopilot, and then observe that it never fails in several million miles, then they might have a legitimate claim on having something safe enough to run unmanned, at least on the classes of roads and situations which the customers tested it on. Though a car that does 10 million perfect highway miles is still not ready to bring itself to you door to door on urban streets, as Elon Musk claimed would happen soon with the Tesla yesterday.

CES 2016 Robocar News

I’m back from CES 2016 with a raft of news, starting with robocars. Some news was reported before the show but almost everybody had something to say — even if it was only to have something to say!

I have many more photos with coverage in my CES 2016 Photo Gallery.

Ford makes strong commitment

Ford’s CEO talks like he gets it. Ford did not have too much to show — they announced they will be moving to Velodyne’s new lower cost 32-laser puck-sized LIDAR for their research, and boosting their research fleet to 30 vehicles. They plan for full-auto operation in limited regions fairly soon.

Ford is also making its own efforts into one-way car share (similar to Daimler Car2Go and BMW DriveNow) called GoDrive, which pushes Ford more firmly into the idea of selling rides rather than cars. The car companies are clearly believing this sooner than I expected, and the reason is very clearly the success of Uber. (As I have said, it’s a mistake to think of Uber as competition for the taxi companies. Uber is competition for the car companies.)

Ford is also doing an interesting “car swap” product. While details are scant, it seems what the service will do is let you swap your Ford for somebody else’s different Ford. For example, if somebody has an F-150 or Transit Van that they know they won’t use the cargo features on some day or weekend, you drive over with your ordinary sedan and swap temporarily for their truck — presumably with a small amount of money flowing to the more popular vehicle. Useful idea.

The big announcement that didn’t happen was the much-rumoured alliance between Ford and Google. Ford did not overtly refute it but suggested they had enough partners at present. The alliance would be a good idea, but either the rumours were wrong, or they are waiting for another event (such as the upcoming Detroit Auto Show) to talk about it.

Faraday Future, where art thou?

The big disappointment of the event was the silly concept racecar shown by Faraday Future. Oh, sure, it’s a cool electric racecar, but it has absolutely nothing to do with everything we’ve heard about this company, namely that they are building a consumer electric car-on-demand service with autonomous delivery. Everybody wondered if they had booked the space and did not have their real demo ready on time. It stays secret for a while, it seems. Recent hires, such as Jan Becker, the former head of the autonomous lab for Bosch, suggest they are definitely going autonomous.

Mapping heats up

Google’s car drives by having super-detailed maps of all the roads, and that’s the correct approach. Google is unlikely to hand out its maps, so both Here/Navteq (now owned by a consortium of auto companies in Germany) and TomTom have efforts to produce similar maps to licence to non-Google robocar teams. They are taking fairly different approaches, which will be the subject of a future article.

One interesting edge is that these companies plan to partner with big automakers and not just give them map data but expect data in return. That means that each company will have a giant fleet of cars constantly scanning the road, and immediately reporting any differences between the map and the territory. With proper scale, they should get reports on changes to the road literally within minutes of them happening. The first car to encounter a change will still need to be able to handle it, possibly by pulling over and/or asking the human passenger to help, but this will be a very rare event.

MobilEye has announced a similar plan, and they are already the camera in a large fraction of advanced cars on the road today. MobilEye has a primary focus on vision, rather than Lidar, but will have lots of sources of data. Tesla has also been uploading data from their cars, though it does not (as far as I know) make as extensive use of detailed maps, though it does rely on general maps.  read more »

Lyft and GM, Sidecar, the nature of competition and CES

Lyft announced a $500M investment from GM with $500M more, pushing them to a $5.4B valuation, which is both huge and just a tenth of Uber. This was combined with talk of a push to robocars. (GM will provide a car rental service to Lyft drivers to start, but the speculation is that whatever robocar GM gets involved in will show up at Lyft.)

With no details, Lyft’s announcement doesn’t really add anything to the robocar world that Uber doesn’t already add. It is GM’s participation that is more interesting, because it’s another car company showing they are not just giving lip service to the idea of selling rides rather than cars. (Mercedes and BWM have also started saying real things in this area.)

My initial expectations for the big car companies were much more bleak for them. I felt that their century long histories of doing nothing but selling cars would impede them from switching models until it was too late. That might still happen, and will happen for some companies, but more might survive than expected. The story also contains some more pure PR comments about OnStar in the new Lyft rental cars. Lyft drivers are all linked in real time with their smartphones; OnStar is obsolete technology, named only to make it seem GM is adding something. GM is not a great robocar leader. They have been very slow even with their highway “super cruise” efforts and the best they have done is partner with Rajkumar at CMU only to find Uber more successful at working with CMU folks.

Sidecar and where are you going?

Also frightening is the news last week of the death of Sidecar. Sidecar was the 3rd place smartphone-hail company after Uber and Lyft, but so distant a third that it decided to shut down. Where Lyft can raise another billion, Sidecar could not get a dime. The CEO is a friend of mine and I’ve been impressed that Sidecar was willing to innovate, even building a successful delivery business on top of the fact that you had to tell Sidecar where you were going. I think it’s important that users say where they are going. It allows much better planning of the use of robocar resources. If customers say where they are going, you can not only do some of the things Sidecar did (deliveries in the trunk the passenger doesn’t even know about, pricing set by drivers, directional goals set by drivers etc.) you can do more:

  • Send short-range cars (electric cars) for short trips
  • Send small (one or two person) cars when there is just one rider
  • Send cars not even capable of the highway if the trip doesn’t involve the highway
  • Pool riders far more efficiently, sometimes in vehicles designed for pooling which have 2-12 private “cabins.”

All of this is important to making transportation vastly more efficient, and in allowing a wide variety of vehicle designs, and a wide variety of power trains. It is only by knowing the destination that many of these benefits can be seen.

Uber lets you enter the destination but does not require it, and people do like having less to do when summoning a vehicle. (I always enter the destination when in places they don’t speak English, it’s a handy way to communicate with the driver.) The driver is not shown the destination until after they pick you up. This stops drivers from refusing rides going places they don’t want to go, which has its merits. It also has serious downsides for drivers, who sometimes at the end of their shift pick up a rider who wants to go 40 miles in the opposite direction of their home.

Even more frightening is what Sidecar’s death says about how much room there is for competitors in the robotaxi space. There are dozens of car makers competing for a new car customer, but San Francisco, the birthplace of Uber, Lyft and Sidecar, could not support 3 players in one of the world’s hottest investment spaces. Two unicorns, but nobody else.

When it comes to competition, the ride business is a strange one. For scheduled rides (which was most of the black car business before Uber) there are minimal economies of scale. A one-car limo “fleet” is still a viable business today, picking up customers for scheduled rides. They provide the same service as a 100 car limo-fleet, though they sometimes have to turn you down or redirect you to a partner.

For on-demand rides, there is a big economy of scale. I want a car now, so you have to have a lot of cars to be sure to have one near me. I will go with the service that can get to me soonest. While price and vehicle quality matter, they can be trumped by pickup time, within reason. Sidecar, being small, often failed in this area, including my attempt to use it on its last day on my way home from the airport.

Robocars offer up a middle ground. Because there is no driver who minds waiting, it will be common to summon a robocar longer in advance of when you want it. Once you know that “I’m leaving in around 20 minutes” you can summon, and the car can find somewhere to wait except in the most congested zones. Waiting time for a robotaxi can be very cheap, well under a dollar/hour, though during peak times, robotaxi owners will raise the price a little to avoid lost opportunity costs. (Finance costs will be under 20 cents/hour at 5% interest, and waiting space will range from free to probably 30 cents/hour in a competitive parking “spot market.”)

The more willing customers are to summon in advance, the more competitive a small player can be. They can offer you instant service when you actually are ready to leave, and that way they can compete on factors other than wait time. Small players can be your first choice, and they can subcontract your business to another company who has a car close by when you forget to summon in advance.)

CES in Las Vegas

I’m off to CES Wednesday. This show, as before promises to have quite a lot of car announcements. Rumours suggest the potential Ford/Google announcement could happen there, along with updates from most major companies. There will also be too many “connected” car announcements because companies need to announce something, and it’s easy to come up with something in that space that sounds cool without the actual need that it be useful.

This morning already sees an announcement from Volvo and Ericsson about streaming video in cars. This is a strange one, a mix of something real — as cars become more like living rooms and offices they are going to want more and better bandwidth, including bandwidth reliable enough for video conferencing — but also something silly, in that watching movies and TV shows is, with a bit of buffering, a high-bandwidth application that’s easy to get right on an unreliable network. Though in truth, because wireless bandwidth on the highway is always going to be more expensive than wifi in the parking space, it really makes more sense to pre-load your likely video choices to win both ways on cost and quality. I have been fascinated watching the shift between semi-planned watching (DVD rental, Netflix DVD queue, DVR, prepaid series subscriptions, watchlists and old-school live TV) and totally ad-hoc streaming on demand. While I understand the attraction of ad-hoc streaming (even for what you planned far ahead to watch) it surprises me that people do it even at the expense of cost and quality. Of course, there are parallels to how we might summon cars!