The end of the gasoline powered car?

[1maGoh]

I read this article and thought of you @Mackeyser . I think definitely stating it's not the self-driving car's fault is a bit premature.

https://jalopnik.com/this-test-shows-why-tesla-autopilot-crashes-keep-happen-1826810902

 

[OldSchool]

For you my friend

Ahhhh the good old screeching monkeys as we used to call them.

 

[Mackeyser]

I read this article and thought of you @Mackeyser . I think definitely stating it's not the self-driving car's fault is a bit premature.

https://jalopnik.com/this-test-shows-why-tesla-autopilot-crashes-keep-happen-1826810902

Well, thanks for thinking of me!

This stuff with the crashes is basically the BS with semi-autonomous systems and why we will have to go fully autonomous or not at all... because people are lazy and stupid. I've seen some of the youtube videos people post while using these systems and... well, there are some future Darwin award winners there.

The system is meant to relieve driver fatigue and is actually safer WHEN USED CORRECTLY.

In every single crash (unlike, say, the Toyota broken accelerator crashes), the crashes were the total fault of the drivers.

And now people need to be told to "hey, even with these helper systems, remember to keep driving"

Sorry, my new Honda has adaptive cruise control and lane departure systems and I find them fantastic...but I never stop driving. Also, you can adjust the distance which varies with speed so if the driving conditions indicate that there are drivers swerving or lots of sudden stops, you can increase the distance to help prevent accidents like that.

Also, in that "last minute swerve" test... almost everyone crashes. They just do. The difference is that the Tesla and other systems are stepped systems and they don't just go instantly to full lock the brakes stop. And that's generally bad to do. If you've ever driven a car with those systems, they aren't evolved enough to discern turning so I've had my brakes kick in on a sharper turn because the system thinks I'm going to crash, but I'm turning and I'm perfectly fine in my lane. It's not a perfect system and as Tesla notes, they aren't uncrashable. They're just much safer if used correctly. That's it.

Point is that this tech is already so much safer than people, it's not funny and the proof is that it takes one idiot following too close and bailing at the last minute and a second idiot to be inattentive to crash the things. And I'm certain there are scenarios where the systems can be defeated by unusual circumstance. The question is, would a fully attentive driver have avoided those accidents? I'd have to see the instance, but in most, I'd wager heavily...no.

When you couple their inherent safety with the fact that multiple car companies including Mercedes, Lexus, Volvo, BMW and others are offering "all inclusive" leases which allow for unlimited driving of ANY vehicle in the category you pay for including very large insurance, concierge service and a host of other features... ownership is gonna go away.

And then the leases are gonna have "on-demand" savings so that you don't have to have your preferred vehicle stuck in the driveway.

As well, with the on-demand fully autonomous vehicles, we'll see smaller version ridesharing... sorta like
SuperShuttle, but for morning and evening commutes. They may also include either weekend "taxi" level service or an on-demand car service.

We just keep seeing this stuff because rather than be responsible, you have people that think that really good semi-autonomous systems are fully autonomous and...well...they just ain't.

Moreover, we really won't see the full benefits until there's a routing command sorta like Air Traffic Control for the roadways. You won't need to worry about privacy because, with fully autonomous systems, you'll have to enter an address to go anywhere, anyway. Once there's a grid manager of some kind, we'll see cars follow much more closely and the existing roadways will be much more efficient...and safer.

 

[1maGoh]

You won't need to worry about privacy

And you lost me. That's not ok.

 

[VegasRam]

When you couple their inherent safety with the fact that multiple car companies including Mercedes, Lexus, Volvo, BMW and others are offering "all inclusive" leases which allow for unlimited driving of ANY vehicle in the category you pay for including very large insurance, concierge service and a host of other features... ownership is gonna go away.

Seen the prices of these? Compare it to your payment, then we'll talk. Ownership may go away....in 20 years.

 

[Mackeyser]

Seen the prices of these? Compare it to your payment, then we'll talk. Ownership may go away....in 20 years.

Mercedes just changed the game. The lower tier including big insurance is $1100 and the higher tier is $1600.

Of course, the starting prices for these services will start at the top.

Wanna know what the payment for a new $100k Mercedes with 20% down @ 3.11% (which is pretty low even with good credit right now)? $1441/mo WITH putting $20k down and that doesn't include insurance.

So... you telling me that I can lease that same car with unlimited miles AND swap it out for any other car in the top tier and it includes really big insurance... for $1595/mo?

That's already a deal.

How long before Lexus or Acura offers the same thing with an entry-level price of $600 including insurance?

It won't take 20 years. There is a mad dash to be seen as a "first mover" and to obtain that advantage in the marketplace.

 

[1maGoh]

Mercedes just changed the game. The lower tier including big insurance is $1100 and the higher tier is $1600.

Of course, the starting prices for these services will start at the top.

Wanna know what the payment for a new $100k Mercedes with 20% down @ 3.11% (which is pretty low even with good credit right now)? $1441/mo WITH putting $20k down and that doesn't include insurance.

So... you telling me that I can lease that same car with unlimited miles AND swap it out for any other car in the top tier and it includes really big insurance... for $1595/mo?

That's already a deal.

How long before Lexus or Acura offers the same thing with an entry-level price of $600 including insurance?

It won't take 20 years. There is a mad dash to be seen as a "first mover" and to obtain that advantage in the marketplace.

If Mercedes has already done it, they've lost "first mover" status already. However, to your point, there's some data that does that first movers actually lose in the long run impress they're reeeeeeally smart about it. Somebody comes in behind them with the same concept, but refined and more sustainable in order to win in the long run.

 

[Mackeyser]

If Mercedes has already done it, they've lost "first mover" status already. However, to your point, there's some data that does that first movers actually lose in the long run impress they're reeeeeeally smart about it. Somebody comes in behind them with the same concept, but refined and more sustainable in order to win in the long run.

Well, Mercedes wasn't first and you're right about what constitutes the "first mover" advantage. It doesn't literally mean the first to market, but rather the one that first brings the product to market where the market first adopts that product.

Like, Apple wasn't even close to first in the MP3 space, but the iPod took the "first mover" advantage because the market saw it as being the first coherent implementation of the "portable digital music player".

Apple was absolutely first with the PDA in the Newton in that if you ever went to a trade show, you'd see people using Newtons a decade after they were EOL'd because still nothing could do what it did. It could take CC payments with a little addon. Now, we have Square, but that's only within the last few years. This was in the MID 90s!!! Newton had handwriting recognition that was really good and was many years ahead of it's time. People just didn't connect with it and Palm got there with their Palm Pilot.

Happens like that sometimes.

Other car companies have already done this, as I said. Mercedes isn't nearly first.

What makes Mercedes offering so compelling is that for those who are already in the market for their offerings, this offer actually offers MORE than simply buying a vehicle. It saves money over an outright purchase. None of the other plans do that.

This is why the Mercedes offering is different.

Will they ultimately get the "first mover" advantage? I dunno. Lexus, Acura or Infiniti could really come out and blow that out of the water and set a new benchmark. We'll see.

The point was that we've crossed the line where these pilot programs aren't just testbeds. The numbers make microeconomic sense for consumers. The other plans don't...not really. That's a big difference.

Once Tesla catches up on their back orders, it wouldn't surprise me to see them try something like that because that gets them out of the "selling" game which would allow them to have "leasing offices" that function like dealers but aren't. Currently, in most states, you can't sell a new car unless you're a licensed dealer. That' the car dealer associations way of preventing cars being sold over the internet. So my money is on something like that happening and it's already likely in the works. The only reason not to announce it is that they're still struggling to catch up to all the back orders.

 

[VegasRam]

Mercedes just changed the game. The lower tier including big insurance is $1100 and the higher tier is $1600.

Of course, the starting prices for these services will start at the top.

Wanna know what the payment for a new $100k Mercedes with 20% down @ 3.11% (which is pretty low even with good credit right now)? $1441/mo WITH putting $20k down and that doesn't include insurance.

So... you telling me that I can lease that same car with unlimited miles AND swap it out for any other car in the top tier and it includes really big insurance... for $1595/mo?

That's already a deal.

How long before Lexus or Acura offers the same thing with an entry-level price of $600 including insurance?

It won't take 20 years. There is a mad dash to be seen as a "first mover" and to obtain that advantage in the marketplace.

No. I was referring to “your” car payment, as in “everyman” cannot afford these leases. When the Japanese and Koreans start doing it, we’ll revisit this.
And leases are still a loser. I own my own business and get a bigger write off buying.

 

[Mackeyser]

And you lost me. That's not ok.

Point was that people have the illusion of privacy now.

I think privacy is a HUGE issue that we don't discuss nearly enough. You KNOW we need to talk about it when the CIA admits 1) they used to domestically spy, like, all the time, on US citizens and 2) they're stopping because they get better intel simply mining social media data, especially Facebook.

So, what I mean that privacy isn't an issue is that it's no more an issue than it is now...because we already have none. And with the fully autonomous vehicles being very close to market entry, even the ability to drive a vehicle that can't be tracked won't be available for much longer.

Sorry, that was confusing on my part. I should have been more clear.

Unless you drive a naturally aspirated car with no electronics, chances are you can be tracked.

Worse, there is already the ability for most modern cars to be outright hacked including, but not limited to turning the engine on/off, activating features like windshield wipers, heat, a/c, cruise control, advanced electronics like turning on/off lane departure, etc.

https://www.wired.com/2015/07/hackers-remotely-kill-jeep-highway/

And that was working in 2015. Cars are only MORE electronic now.

There's evidence (not saying it's conclusive) that the CIA killed Michael Hastings, a war correspondent by hacking his car in 2017. What's scary is that it's totally doable and it's not even THAT hard. We're not talking about uber hackers.

 

[Mackeyser]

No. I was referring to “your” car payment, as in “everyman” cannot afford these leases. When the Japanese and Koreans start doing it, we’ll revisit this.
And leases are still a loser. I own my own business and get a bigger write off buying.

I don't disagree with you.

When I make a macroeconomic argument, there are often times when the microeconomics are the exact opposite and I understand that.

The point was that Mercedes has already made a compelling case at a price point that it's more economically advantageous to do the "all-inclusive lease".

These things start at the top for a number of reasons that I won't get into, but it's essentially a beta test for mass consumption as well as a means to work out the processes and technology including support infrastructure.

This is progressing just like every car technology. Fuel injection started with super expensive cars. Now, every car is fuel injected. Air bags...GPS...cruise control....adaptive cruise control...proximity sensors...rear cameras...the list goes on.

As for "leases are losers", again, we almost certainly won't have a choice as "everymen". And I think we can both agree that we can barely feel comfortable that we know what the tax code is going to be like next week. 10 years from now when these leases are becoming a reality for most folks, who knows what the tax code is gonna look like? I do economics pretty well, but I'm bushwacked if I can guess future tax policy...

Once fully autonomous driving is in the market, it'll prove safer than people within days and insurance underwriters will assess that risk and offer significantly lower policies for those cars and much, much higher premiums for actual drivers. It'll get to the point where insurance companies will generally only offer "fleet pricing" for fully autonomous vehicles (which will be baked into your car payment like the Mercedes deal) and you'll have to go to a specialty underwriter for insurance.

Rest assured, an individual's tax benefit will play exactly zero role in how quickly this new way is implemented.

I'm not comforted that more and more economists are STARTING to talk about this impending disruption and how it will redefine the very nature of how we relate to one another... because we're rapidly getting to the point where automation, AI and fully autonomous systems will remove so many jobs from the economy that we're going to have to revisit the nature and requirement to work.

I watched some CNBC videos last night and when trusted economists and market analysts start talking about how this disruption is going to redefine things... even the hosts were lost for words. And earthquake is one thing when it "shakes things up". It's a whole 'nother animal when it "redefines the landscape"... So, yeah. It's gonna look different and we'll have to figure things out.

I mean, it's very likely we won't, we'll crown the first trillionaire and income disparity will make the Gilded Age seem like utopia. And that's not a political argument, that's an economic possibility.

I'd like to think we'd go back to fostering entrepreneurship, but...

 

[1maGoh]

Point was that people have the illusion of privacy now.

I think privacy is a HUGE issue that we don't discuss nearly enough. You KNOW we need to talk about it when the CIA admits 1) they used to domestically spy, like, all the time, on US citizens and 2) they're stopping because they get better intel simply mining social media data, especially Facebook.

So, what I mean that privacy isn't an issue is that it's no more an issue than it is now...because we already have none. And with the fully autonomous vehicles being very close to market entry, even the ability to drive a vehicle that can't be tracked won't be available for much longer.

Sorry, that was confusing on my part. I should have been more clear.

Unless you drive a naturally aspirated car with no electronics, chances are you can be tracked.

Worse, there is already the ability for most modern cars to be outright hacked including, but not limited to turning the engine on/off, activating features like windshield wipers, heat, a/c, cruise control, advanced electronics like turning on/off lane departure, etc.

https://www.wired.com/2015/07/hackers-remotely-kill-jeep-highway/

And that was working in 2015. Cars are only MORE electronic now.

There's evidence (not saying it's conclusive) that the CIA killed Michael Hastings, a war correspondent by hacking his car in 2017. What's scary is that it's totally doable and it's not even THAT hard. We're not talking about uber hackers.

Working in the IT security industry I can say that hacking things, especially a car, is both easier and more difficult than people realize. The basic problem with a lot of cars on the road now is that you have to have an ingress method. I have a 2012 Ford Fiesta (running strong, great car) that has no GPS, no wifi, no OnStar, etc. The path to hack that, if it's possible, is a long one through the radio to the ECU (if they're connected on such a way). Theoretical stuff comes out all the time, hacking a phone using the plug-in headphones as an antenna for commands (as an example), etc. But if the phone designer made it so the fucking headphone jack can't send commands to the phone, that wouldn't be a thing. It's sloppy security design because somebody had "a cool idea".

What makes it easy if that no one is don't any kind of security protocols or security engineering at all for a lot of stuff now, cars included. It's not a problem so they don't "have to". Once people start having cars all the time, that will get locked down too. Then it won't be easy.

Nothing is unhackable, but you can put it out of reach of 70-90% of hackers just by being thoughtful and working at it.

 

[Mackeyser]

Working in the IT security industry I can say that hacking things, especially a car, is both easier and more difficult than people realize. The basic problem with a lot of cars on the road now is that you have to have an ingress method. I have a 2012 Ford Fiesta (running strong, great car) that has no GPS, no wifi, no OnStar, etc. The path to hack that, if it's possible, is a long one through the radio to the ECU (if they're connected on such a way). Theoretical stuff comes out all the time, hacking a phone using the plug-in headphones as an antenna for commands (as an example), etc. But if the phone designer made it so the freaking headphone jack can't send commands to the phone, that wouldn't be a thing. It's sloppy security design because somebody had "a cool idea".

What makes it easy if that no one is don't any kind of security protocols or security engineering at all for a lot of stuff now, cars included. It's not a problem so they don't "have to". Once people start having cars all the time, that will get locked down too. Then it won't be easy.

Nothing is unhackable, but you can put it out of reach of 70-90% of hackers just by being thoughtful and working at it.

Oh, I totally agree. Also, the level of electronic adoption in cars even between 2012 and 2015 is significant.

I'm sure it's significantly higher today than in 2015.

I'm a former network engineer, so I get it as do you.

"hacking" isn't what people think and it's such a ubiquitous and now generic term that it's almost rendered meaningless.

I remember the days when someone could say, "do you know computers?" and yeah, you basically could.

Now? It's all sub-sub-specialties within industries. Things like Healthcare IT Security Asset Management.

I'm kinda glad I'm retired from all that. I mean, some of the technical problems I'd love to take a crack at, but overall...ugh.

But yeah, as to your point, if hacking of cars becomes widespread, then I expect that they'll implement changes. Thing is, it's unlikely that they'll recall the 50M+ cars out there that are hackable.

Still. I can't imagine the panic if my car got hacked...especially at 80mph. Not that I drive that fast, you see...

 

[1maGoh]

Oh, I totally agree. Also, the level of electronic adoption in cars even between 2012 and 2015 is significant.

I'm sure it's significantly higher today than in 2015.

I'm a former network engineer, so I get it as do you.

"hacking" isn't what people think and it's such a ubiquitous and now generic term that it's almost rendered meaningless.

I remember the days when someone could say, "do you know computers?" and yeah, you basically could.

Now? It's all sub-sub-specialties within industries. Things like Healthcare IT Security Asset Management.

I'm kinda glad I'm retired from all that. I mean, some of the technical problems I'd love to take a crack at, but overall...ugh.

But yeah, as to your point, if hacking of cars becomes widespread, then I expect that they'll implement changes. Thing is, it's unlikely that they'll recall the 50M+ cars out there that are hackable.

Still. I can't imagine the panic if my car got hacked...especially at 80mph. Not that I drive that fast, you see...

I imagine they'll start segmenting systems into things that can talk to the world on one system and things that can't on another system, with an air gap in between. A real air gap.

Also, I like you that much better if you used to be a network engineer.

If they can get an all inclusive lease down to about $300, I might bite. I would dislike having to make payments forever though. I already hate the subscription economy movement that's going on (even though my job depends on it; it's not exactly the same). I would be really frustrated if my home and car moved to that as well.

 

[Mackeyser]

Yep, was def a network and multimedia engineer.

I architected the first Mac-based render farm for a dot.com in 1999, built out and worked on Windows NT networks way back in the day as a Novell Netware consultant for places like Cedars Sinai, Hughes Aerospace, and Raytheon. as well as being an all-around support guy for various clients with Macs. I was about to go for my Cisco cert (crazy expensive and had 4 young kids) when I took a step back for what started out as a basic support job really close to my kid's school for a dot.com. I opened up my mouth in a catered lunch with everyone sitting there...and well, I built something pretty special with a team of special people.

I also don't talk at lunch anymore.

I miss the work...well, the part of challenging myself to fix a problem under a deadline. I never missed a deliverable, but then I was an ironman and figured if my arm couldn't stop the gears, I'd throw an arm and a leg.

I was stupid that way.

I don't miss the people I had to work for or the end users.

And, I swear, I'll starve before I would ever again did computer support/work for a lawyer. /shudder

 

[Kevin]

I'm too late to contribute to the discussion, but there are serious obstacles to full implementation of electric powered autonomous driving vehicles. For starters: Impacts on the oil and gas industry and all other sectors of the economy related to it, the cost of implementation would be staggering and expensive to maintain, insurance will still be required because these systems will fail at some time and someone will have to be responsible, cultural change is slow meaning people will be hesitant to give up their car and the driving experience, weather affects the ability of autonomous vehicles to stay on course, loss of gas tax revenues to the federal and state governments who build and maintain the roads system, likely increase in traffic congestion due to empty AVs driving around; and finally battery technology still limits the operational range of these vehicles.

MnDOT is researching this as are a few other states. Here's a link: http://www.dot.state.mn.us/automated/index.html

 

[Mackeyser]

I'm too late to contribute to the discussion, but there are serious obstacles to full implementation of electric powered autonomous driving vehicles. For starters: Impacts on the oil and gas industry and all other sectors of the economy related to it, the cost of implementation would be staggering and expensive to maintain, insurance will still be required because these systems will fail at some time and someone will have to be responsible, cultural change is slow meaning people will be hesitant to give up their car and the driving experience, weather affects the ability of autonomous vehicles to stay on course, loss of gas tax revenues to the federal and state governments who build and maintain the roads system, likely increase in traffic congestion due to empty AVs driving around; and finally battery technology still limits the operational range of these vehicles.

MnDOT is researching this as are a few other states. Here's a link: http://www.dot.state.mn.us/automated/index.html

Welcome to the discussion. It's not too late at all. I'll go point by point because I'm in the middle of a migraine and my short term memory is total crap at the moment.

Firstly, it's happening. The only question is how it happens. Gas powered cars will go away. The only question is how soon.

Secondly, fully autonomous driving systems are happening. We'll first see them in trucking. There's already a module that retrofits existing rigs for $50k (est) that's in deep beta right now. Mercedes, Volvo, Kenilworth, Peterbuilt, Walmart (in conjunction with Peterbuilt) and Tesla are far enough along that they're taking orders for trucks that are semi-autonomous and are very close to making them fully autonomous. Walmart has order 15 Tesla trucks in addition to what they're developing with Peterbuilt and none of the vendors will be able to keep up with orders for some time.

Thirdly, fleet insurance is already a thing so that's not a problem. And EVERYONE from Hertz to to Uber to Ford are trying to figure out the alchemy for a subscription based model. The problem will be people who do things like in person sales or actually need to move around for a living because personal insurance will go up prior to the wide adoption of these leasing agreements because underwriters and risk assessors will realize how bad people are at driving compared to computers. So, yeah, there's gonna be some really wicked growing pains with this and as usual, the worst hit will be those on the lower end of the working class.

Fourthly, it's not just the lack of a gas tax for maintaining roads, but it's also the lack of traffic violations that fund cities. Los Angeles gets fully 33% of its revenues from traffic violations, from parking to traffic tickets. And most of their payroll actually comes from traffic revenues as it's easier to manage that liquid money that budget from property tax assessments, etc. What are big cities that rely on traffic infractions going to do when there are literally zero funds from traffic fines/parking tickets? That's a question that cities need to answer NOW because it takes a lot of time to reorient large city and/or state governments with different revenue streams.

Fifthly, there's almost certainly going to be less traffic congestion seeing as how I mentioned that there is almost certainly going to be a SuperShuttle model where people carpool to work, but you don't have to worry about Gary being late or Linda's car being too small, etc. There almost certainly won't be accidents on the road, so that means fewer cars on any stretch at a particular time and if there is a "road manager" type of road traffic control that routes you, you'll be put on an optimal route both for yourself and all the other drivers (as opposed to now where you simply make decisions for yourself based on traffic conditions in the moment). Empty AVs will likely be driven to lots and then driven to the closest staging lot during off-peak times so that they can be delivered in a timely fashion to the next rider.

Lastly, battery tech is on the verge of major improvements. Tesla just announced its new Roadster with a battery with over 600miles. Granted, that's for a lightweight car, but it's still got all the amenities including A/C, leather seats and all those electronics. And that innovation which is mostly an iterative improvement isn't even the next breakthrough that's coming.

I fully expect that there will be a proof of concept for a battery that can take a car from SF to NY on one charge in the next 10-15 years.

The unknowns in all this are things like a) who the winners will be among all the vendors? Will there be an Apple-esque winner that takes more than half the market? Will there be vendor diversity like we currently see in the auto landscape? b) what pace will the market switch and will the changes align close enough that people aren't seriously harmed? I mean if the insurance market really gets ahead of the auto market, that will really negatively impact some folks... c) what are cities, states and the Federal gov'ts going to do with the ever decreasing gas taxes, personal auto registrations, parking and traffic revenues, etc? d) what are all the displaced workers going to do? What with all the online shopping, now's about the best time ever to be a truck driver (not the traffic, cuz that's always sucked or the weather, cuz...yeah) but that profession is about to go the way of the travel agent. Truck/car mechanic? That, too, especially if they go the fleet method which makes the most economic sense for reasons that would make this a multipage post if I were to list them. Autobody repair? Few and far between because....a ton fewer crashes. So how does the economy deal with this change?

The economy will have tremendous opportunities for everyone if we eschew monopolies and foster entrepreneurship and innovation in the market. That will also help us truly address the job losses.

As an aside, if we would foster a national build out of fiber as in investment like the National Highway System, people wouldn't have to congregate in big cities nearly as much and smaller towns would have the population to scale and offer more jobs/services/business options that typically elude smaller towns today.

I fear we will just treat people as consumers and we'll see these big companies as gladiators and celebrate the last one standing as if that's what makes for a good economy. Jeff Bezos as a Trillionaire isn't great for the economy as a whole. Better to have a million millionaires...if one were given the choice, I mean.

 

[1maGoh]

Welcome to the discussion. It's not too late at all. I'll go point by point because I'm in the middle of a migraine and my short term memory is total crap at the moment.

Firstly, it's happening. The only question is how it happens. Gas powered cars will go away. The only question is how soon.

Secondly, fully autonomous driving systems are happening. We'll first see them in trucking. There's already a module that retrofits existing rigs for $50k (est) that's in deep beta right now. Mercedes, Volvo, Kenilworth, Peterbuilt, Walmart (in conjunction with Peterbuilt) and Tesla are far enough along that they're taking orders for trucks that are semi-autonomous and are very close to making them fully autonomous. Walmart has order 15 Tesla trucks in addition to what they're developing with Peterbuilt and none of the vendors will be able to keep up with orders for some time.

Thirdly, fleet insurance is already a thing so that's not a problem. And EVERYONE from Hertz to to Uber to Ford are trying to figure out the alchemy for a subscription based model. The problem will be people who do things like in person sales or actually need to move around for a living because personal insurance will go up prior to the wide adoption of these leasing agreements because underwriters and risk assessors will realize how bad people are at driving compared to computers. So, yeah, there's gonna be some really wicked growing pains with this and as usual, the worst hit will be those on the lower end of the working class.

Fourthly, it's not just the lack of a gas tax for maintaining roads, but it's also the lack of traffic violations that fund cities. Los Angeles gets fully 33% of its revenues from traffic violations, from parking to traffic tickets. And most of their payroll actually comes from traffic revenues as it's easier to manage that liquid money that budget from property tax assessments, etc. What are big cities that rely on traffic infractions going to do when there are literally zero funds from traffic fines/parking tickets? That's a question that cities need to answer NOW because it takes a lot of time to reorient large city and/or state governments with different revenue streams.

Fifthly, there's almost certainly going to be less traffic congestion seeing as how I mentioned that there is almost certainly going to be a SuperShuttle model where people carpool to work, but you don't have to worry about Gary being late or Linda's car being too small, etc. There almost certainly won't be accidents on the road, so that means fewer cars on any stretch at a particular time and if there is a "road manager" type of road traffic control that routes you, you'll be put on an optimal route both for yourself and all the other drivers (as opposed to now where you simply make decisions for yourself based on traffic conditions in the moment). Empty AVs will likely be driven to lots and then driven to the closest staging lot during off-peak times so that they can be delivered in a timely fashion to the next rider.

Lastly, battery tech is on the verge of major improvements. Tesla just announced its new Roadster with a battery with over 600miles. Granted, that's for a lightweight car, but it's still got all the amenities including A/C, leather seats and all those electronics. And that innovation which is mostly an iterative improvement isn't even the next breakthrough that's coming.

I fully expect that there will be a proof of concept for a battery that can take a car from SF to NY on one charge in the next 10-15 years.

The unknowns in all this are things like a) who the winners will be among all the vendors? Will there be an Apple-esque winner that takes more than half the market? Will there be vendor diversity like we currently see in the auto landscape? b) what pace will the market switch and will the changes align close enough that people aren't seriously harmed? I mean if the insurance market really gets ahead of the auto market, that will really negatively impact some folks... c) what are cities, states and the Federal gov'ts going to do with the ever decreasing gas taxes, personal auto registrations, parking and traffic revenues, etc? d) what are all the displaced workers going to do? What with all the online shopping, now's about the best time ever to be a truck driver (not the traffic, cuz that's always sucked or the weather, cuz...yeah) but that profession is about to go the way of the travel agent. Truck/car mechanic? That, too, especially if they go the fleet method which makes the most economic sense for reasons that would make this a multipage post if I were to list them. Autobody repair? Few and far between because....a ton fewer crashes. So how does the economy deal with this change?

The economy will have tremendous opportunities for everyone if we eschew monopolies and foster entrepreneurship and innovation in the market. That will also help us truly address the job losses.

As an aside, if we would foster a national build out of fiber as in investment like the National Highway System, people wouldn't have to congregate in big cities nearly as much and smaller towns would have the population to scale and offer more jobs/services/business options that typically elude smaller towns today.

I fear we will just treat people as consumers and we'll see these big companies as gladiators and celebrate the last one standing as if that's what makes for a good economy. Jeff Bezos as a Trillionaire isn't great for the economy as a whole. Better to have a million millionaires...if one were given the choice, I mean.

I think all those reasons against/questions you posed are going to be why it takes much longer to adopt than I feel like you're implying. Gas and oil companies have the really big money now and on top of being able to donate to politicians (buy them), by allowing these changes the politicians would be shrinking the pool of money they draw a salary from. Self interest will win out. Politicians are greedy and self centered, for the most part.

If insurance companies change rates too fast based on autonomous vehicles, then they'll lose a crap ton of money too. If next quarter rates for manually driven vehicles tripled, too many families would fall to afford insurance. That would cut profits. Those companies crunch the numbers, but they're also just humans who are trying to make a buck and impress investors.

Kroger is starting completely autonomous delivery service already, so I don't know how accurate it is to say that autonomous trucks will be the first to test the fully autonomous service/market/capability.

And everything breaks. Everything breaks. There may not be diesel mechanics, but there will be electric motor technicians. And when one of those vehicles breaks on the road, we saw in the video how well the self driving cars adapt to sudden condition changes. Trucking companies will still have to do maintenance on things like breaks, struts, shocks, tires, etc. They've already problem that they'll cut corners to save a few bucks. Electric won't suddenly make them good people who stay ahead of maintenance when it costs more. And you know that regular people will do the same. We'll stretch any maintenance window to the absolute last second if we know what it is. If you guarantee that a motor will have a catastrophic failure at 100k miles, 2/3 of the population would drive out to 99,999.999 then put it in neutral and push it to the shop. We're irresponsible.

Lastly, when you say that if we don't manage these things well then we'll end up really screwing ourselves, that's when the government will knee jerk and start banning or severally limiting autonomous tech. When faced with the decision of 1) let 10 million voters lose their jobs and hate me, or 2) ban/limit good tech so that my voters stay happy, I think we can guess how that's going to go.

Super lastly, in a perfect world, what you're saying makes sense. Unfortunately, humans are irrational actors. That fact has plagued economists for decades because you can't predict inconsistently irrational behavior. If it worked like you're saying, then sales would be the easiest job on the world. The best product at the best price would always win. You would just have to tell people which one that is and be done with it. Sadly, it doesn't work that way.

As a cool side note though, a few weeks ago I did see an electric big rig towing a trailer in Austin where I work. I did not get to see if it had a driver, but it looked normal so I suspect it did.

 

[Mackeyser]

We'll, yes and no.

I don't profess to know how fast the change will happen, but it will be much faster than is commonly thought. That's been the case for every single technology since the VCR, so I don't see why this would be any different.

The insurance will be what it is. They already do risk analysis regarding things like not paying policies on deaths that should be covered because they'll net save money on litigating and all sorts of other things that prove beyond a shadow of a doubt that to count on an insurance company to be partly human is to believe in fairy tales.

Tests of autonomous driving for things like pizza delivery and grocery sales will continue for some time, but are individually market sensitive and are much farther from mass adoption than autonomous trucks will be. Moreover, when it comes to things like maintenance, it's likely that the insurance will require immaculate maintenance records in order to get the preferred fleet rates, so companies will have an economic incentive to keep their vehicles in good working order. Also, broken trucks don't make deliveries.

I get that everything breaks. Heck, the tires will still shred, etc. I didn't say that there would be no mechanics or auto body workers, just far fewer. And if ownership goes away, then all the mechanics/auto body workers would have to be employed by a fleet owner of some kind. If no one individually owns cars, what business case could there be for a local mechanic or body shop?

I'm certainly not foolish enough to guess what politicians will do. I never seem to understand their thinking beyond "how can I sell out without my constituents thinking I'm selling out so that I don't have to cold call people in my district for more than half the day in a room that smells like a high school wrestling mat?" Apple was nearly insolvent in 1995 and yet, in 2015 was the largest company ever with a market cap of nearly $600B. Things change rapidly in these times now and historically, stasis tends to always lose to change in the long run. There are moments when change is halted...sorta like building a berm made of sand, but the tide inevitably rises and stasis and the berm fail.

I believe that people behave rationally in their perceived best interest. That goes for both personal and professional decisions. What trips people up is that their perceived best interest not only isn't always their best interest, often it is the direct opposite. But they function and make decisions based on their perception and often in contraindication of things like facts in evidence and past performance.

Kodak invented digital photography and yet rather than be a standard bearer for decades, they were bankrupt in 2012 with companies vying for their IP. MySpace used to be huge...it's nearly nothing now. Sometimes the question isn't what new will come, but rather what's here that will survive? We don't know because so many variables come into play that we get some odd results. Kodak died and Apple rose from the ashes and one of the biggest reasons? The iPhone and being able to take good digital pictures on their phones. No one would have guessed THAT in 1995.

Will politicians become luddites in order to cater to a set of dying industries? Will the new tech owners buy the next round of sellout politicians to make the change even swifter?

That I don't know. I do pretty well with tech and econ, but politics? The horse trading and all that Game of Thrones, House of Cards stuff... I'm lost when it comes to that.

 

[Kevin]

Mack, a thoughtful and well-written response as always. How are you? There is a house for sale in my neighborhood. You and the family could move in and be just a few doors down from George and Jamie Edwards, the Vikings Defensive Coordinator! Seriously, they are renting the house next door to us; I chatted with them at a garage sale last Saturday. Very nice people. he thinks very highly of Todd Gurley and what the Rams have done on defense this offseason.

I think fully autonomous electric vehicles will have no more than a niche in the transportation system for the foreseeable future, and I mean for decades to come. Too many costly obstacles that need to be addressed by governments at all levels. Check out this article from a few years ago. Personal rapid transit was thought to be the cutting edge of public transportation, but there were too many issues for it to be anything more than a novelty. https://www.citylab.com/life/2014/0...sit-is-probably-never-going-to-happen/380467/