DRAFT: Questions and thoughts about self-driving cars

There has a tremendous acceleration in the self-driving cars technology and self-driving cars have been deployed to areas like SF for example. The technology could be a saver for many people that don’t like the driving for commute or leisure because of its stress and the fact they are losing time without doing anything. I would have been an early adaptor if I was still commuting to office, so I can do something useful in my 20-50 minutes driving to the parking lot before hoping on a train. I still wonder if the technology will make it to mass markets and will be profitable for car companies. 

TLDR, in summary 

I believe the self-driving cars will be the future, it might take some time for them to be a mainstream till the technology is regulated, approved, and become mainstream, still they have an appealing factor for a lot of commuters, now to the details:

In the current model that is being tested the self-driving cars are serving like taxis, hence they are serving consumers who don’t have cars or don’t want to drive. In that model I see several hurdles:

• Regulations
• Competition 
• Excitement

1- Regulations

Regulations are the main hurdle that is facing driving cars, here is a few examples of what manufacturer are facing at the moment.

Rollout regulations

The biggest hurdle so far has been regulations, Cruise one of the pioneers in the field, has been rolling rides slowly in certain areas in SF and they started expanding to other few cities. It will take time to trust the technology, so majority of countries and even cities will need assurance that the technology is working, that might be achieved through completing several rides/miles/kilometers before allowing the robot taxis to operate. That will be an expensive process and it will be mandatory as just only one incident affecting human beings could be enough to shut down the technology. 

Maintenance regulations

How often the self-driving cars will be maintained, these are sophisticated machines, it isn’t just a bout mechanical parts, there are the sensors and above all the software. Would checking the software will be only through checking if the car has the latest version and all the updates or it will be more than that. It is difficult to imagine having a thorough view of the software every time the car needs to get its own renewal to run on the road.

Insurance regulations

If an accident happen who will be responsible the operator or the manufacture, it makes sense to be the manufacturer as the vehicle is driving itself, if that is the case that will be a big liability. If a version of the car/software has a bug that is causing major accidents that will be catastrophic

2- Competition

As a taxi autonomous vehicle will face competition from traditional taxi operators and ride hailing companies like Uber and Lyft. 

Traditional taxis

The power of taxi drivers is that they have unions, and they have the right to vote. Autonomous vehicles will be a big threat to regular taxi operator for the following reasons:

• There is no human cost so rides might be cheaper even though the car will be more expensive at least in the short term.
• Transparency, there will be no hidden fees/negotiation when paying for the ride. 
• Safety, many people who are returning either late or from social events will find it safer to ride with no human.

I imagine a battle between Taxi operators and the roll out of autonomous vehicles. I would imagine they will push for:

• Blocking the roll out and accusing the technology of not being safe
• They can also push for regulating the hours that a vehicle can operate per day.
• Higher license fees to register the vehicles to operate in cities like NY so it can be considered a taxi.

Ride hailing

Ride hailing seems the natural home to autonomous driving in the long run. Where I can imagine once technology and regulations are stable, ride hailing companies will be the main purchaser of the cars depending on the price point. Till that happens it will be interesting to see how the competition will go for now. Ride hailing companies take around 30% of ride price and the rest go to the drivers. The drivers bear the responsibility of everything else e.g., gas, insurance, and cleaning. There are always new cars joining the raid hailing companies. The question become then will the that 30% enough for car manufactures to compete in the space? It isn’t clear what will be the cost for the self-driving cars once they are introduced to the market, still I doubt if they can compete with the ride hailing companies.

3-Excitement factors

The current business model for self-driving cars as taxis is targeting consumers who live in big cities and don’t have a car or not willing to drive for example because of traffic or lack of parking. In order to expand to regular drivers and compete with regular cars self-driving cars will need to overcome few hurdles:

• Control: Cars has a n excitement to them, many people like driving, accelerating and the feel of racing. Self-Driving cars are cool for sure, however for many people they want to be in the driving seat and control what is going on. 
• Shape: the early models of self-driving cars aren’t exciting enough in terms of how they look from the outside. That might not be a big factor when they are driven right now as taxis, however that is a bug turn off if they will be mainstream.

Summary

I believe the self-driving cars will be the future, it might take some time for them to be a mainstream till the technology is regulated, approved, and become mainstream, still they have an appealing factor for a lot of commuters.