One comment about your estimated depreciation costs: they should be much higher, for both Waymo and Uber. Driving 3,000+ hours per year would wear out a car in much less than 10 years.
I made a different visual here that estimates cost of Waymo vs. Uber as a percentage of current total Uber fares. It seems like Waymos will become cost competitive once their vehicles are only twice the price of the average Uber driver's car: https://www.2120insights.com/i/152869747/medium-term-is-the-price-right
Thanks for sharing this - and great article! If I double depreciation to 5 years it comes out right at the same point as my Uber calculation - though still below your estimate. Half the reason I write publicly is to get push back and learn! Have you seen a $90k estimate for the Ioniq or is that an educated guess? Another interesting use case I could envision spreading is what I've read people are already doing in San Francisco - having Waymo drive kids. My brother and his wife are considering hiring someone to drive their kids to scool - but they're not satisfied to have it be just any random Uber person - so would go with a more expensive company for the security of it - idk what TAM is of this as it's only higher income folks using it - but interesting to watch develop!
For the Ioniq price, it's just an educated guess-- I just doubled the MSRP based on the $150k cost of I-PACEs being double MSRP, assuming as you also have that the cost of outfitting/LIDAR has come down.
One other thing you may want to adjust in your calculation is a shorter window for Waymo depreciation since the vehicles are driving more hours per year. Maintenance costs _per hour_ will be the same, but if you're dividing the total cost by a higher number of hours, it's not an apples-to-apples comparison unless you also factor in higher total maintenance costs per year due to total driving time.
Having Waymos drive kids will certainly expand the market but unsure by how much. If 50%+ of the public is still skeptical about the technology, I'm not sure if that's higher or lower among parents. But saving themselves from the harrowing experience of teaching their kids how to drive might motivate some parents to encourage their kids to get comfortable with self-driving!
1) "Pre-Waymo cutting edge LiDAR systems cost around $75,000 per unit. Uses were mostly limited to military and geographical mapping. If you wanted to build a transport-related solution then you needed at least 3 units. Fast forward to today and these systems are tracking to drop below $1k in total in China."
With a $75k unit cost, no wonder Elon has refused to use lidar in Teslas. Now, with sub-$1k unit cost, it won't make sense not to have lidar.
2) Waymo is "managing 200k rides per week with a fleet not much larger than 1,000 vehicles."
The average car is used only 4% of the time. By transcending the human need for sleep, Waymo shows the power of operating cars 50-80% of the time, allowing for the generation of an astounding $1m worth of driver time value compared to a human-driven car.
Pretty crazy right. And thus far another wild thing to consider is that electric cars themselves have been following a Wright's law cost decline (unlike the ice cars). ICE cars get better every year so there is a sort of hidden cost decline - but EVs actually get cheaper steadily. Combine that with the AI/Sensors plummeting in cost and you have a situation where we could just start seeing the cost of transport fall from the not distant future on out. Still, with 1.1 billion trips per day taken in the united states, it will take a lot of capex to start making a meaningful dent. Another thing I'm curious about puzzling through is how much market share autonomous needs to hit in order to start causing demand for new vehicles to drop. So much interesting stuff worth researching, such a fun time we live in!
Yeah, that's a great point. I never even thought about a Moore's law type of situation for all the components that go into EVs and autonomous vehicles (batteries, lidar) and how that would affect mobility. I think it's going to be pretty incredible.
Great to see these LiDAR cost trends.
One comment about your estimated depreciation costs: they should be much higher, for both Waymo and Uber. Driving 3,000+ hours per year would wear out a car in much less than 10 years.
I made a different visual here that estimates cost of Waymo vs. Uber as a percentage of current total Uber fares. It seems like Waymos will become cost competitive once their vehicles are only twice the price of the average Uber driver's car: https://www.2120insights.com/i/152869747/medium-term-is-the-price-right
Thanks for sharing this - and great article! If I double depreciation to 5 years it comes out right at the same point as my Uber calculation - though still below your estimate. Half the reason I write publicly is to get push back and learn! Have you seen a $90k estimate for the Ioniq or is that an educated guess? Another interesting use case I could envision spreading is what I've read people are already doing in San Francisco - having Waymo drive kids. My brother and his wife are considering hiring someone to drive their kids to scool - but they're not satisfied to have it be just any random Uber person - so would go with a more expensive company for the security of it - idk what TAM is of this as it's only higher income folks using it - but interesting to watch develop!
You're welcome!
For the Ioniq price, it's just an educated guess-- I just doubled the MSRP based on the $150k cost of I-PACEs being double MSRP, assuming as you also have that the cost of outfitting/LIDAR has come down.
One other thing you may want to adjust in your calculation is a shorter window for Waymo depreciation since the vehicles are driving more hours per year. Maintenance costs _per hour_ will be the same, but if you're dividing the total cost by a higher number of hours, it's not an apples-to-apples comparison unless you also factor in higher total maintenance costs per year due to total driving time.
Having Waymos drive kids will certainly expand the market but unsure by how much. If 50%+ of the public is still skeptical about the technology, I'm not sure if that's higher or lower among parents. But saving themselves from the harrowing experience of teaching their kids how to drive might motivate some parents to encourage their kids to get comfortable with self-driving!
1) "Pre-Waymo cutting edge LiDAR systems cost around $75,000 per unit. Uses were mostly limited to military and geographical mapping. If you wanted to build a transport-related solution then you needed at least 3 units. Fast forward to today and these systems are tracking to drop below $1k in total in China."
With a $75k unit cost, no wonder Elon has refused to use lidar in Teslas. Now, with sub-$1k unit cost, it won't make sense not to have lidar.
2) Waymo is "managing 200k rides per week with a fleet not much larger than 1,000 vehicles."
The average car is used only 4% of the time. By transcending the human need for sleep, Waymo shows the power of operating cars 50-80% of the time, allowing for the generation of an astounding $1m worth of driver time value compared to a human-driven car.
Pretty crazy right. And thus far another wild thing to consider is that electric cars themselves have been following a Wright's law cost decline (unlike the ice cars). ICE cars get better every year so there is a sort of hidden cost decline - but EVs actually get cheaper steadily. Combine that with the AI/Sensors plummeting in cost and you have a situation where we could just start seeing the cost of transport fall from the not distant future on out. Still, with 1.1 billion trips per day taken in the united states, it will take a lot of capex to start making a meaningful dent. Another thing I'm curious about puzzling through is how much market share autonomous needs to hit in order to start causing demand for new vehicles to drop. So much interesting stuff worth researching, such a fun time we live in!
Yeah, that's a great point. I never even thought about a Moore's law type of situation for all the components that go into EVs and autonomous vehicles (batteries, lidar) and how that would affect mobility. I think it's going to be pretty incredible.
Demand for new vehicles has already dropped due to ride hailing and the Internet making staying home more appealing for young people. The percentage of 18 year olds with driver's licenses dropped from 80% in 1983 to 60% in 2022. https://www.usatoday.com/story/graphics/2024/05/17/gen-z-less-likely-get-drivers-license/73678202007/
Autonomous vehicles are definitely going to cause that percentage to drop further.
young people driving less is wild. eveyrone i knwe got their license the day they turned 16 or they were apoplectic