One Person is Going to Buy 500,000 Teslas
First of all we heard the government in LA is buying a fleet of EVs but even that wasn’t 500,000. How about the USA government? They could afford to buy that many Teslas if they had some useful purpose? I’m doubtful of that.
Well this isn’t an actual order but one that was more like a commitment to buy. Turns out that Uber CEO Travis Kalanick told Venture Capitalist Steve Jurvetson that he would buy 500,000 self-driving Teslas in 2020 if they were available! Now that is one big commitment.
So now you can connect the dots. Why would Uber need 500,000 Teslas? We don’t have to look very far back in recent history to know what comes next. Take McDonalds for example. The city of Seattle increases the minimum wage to $15/hr and McDonalds responds by installing self-ordering kiosks in their locations. So with Self-Driving Teslas, Uber can just program the cars to sync up with the apps and each driverless Tesla will show up at an address and Uber collects the whole fee. No drivers needed.
There is some speculation that the move to autonomous cars will change the car buyers’ market entirely as we know it. What this means is that in the future, people may forgo the whole car buying experience in general. The reasons would be economic and convenience. If you live within a certain radius of a big city, you could likely satisfy all your driving needs with the app on your phone. You need to go to the store? Summon an Uber vehicle and the self-driving car shows up at your door. The car then takes you to your destination and it can either wait for you, or you summon another ride when you are done.
The future here is not as far away as you think. The CEO of Uber wants to buy them in 2020 if they are available. What if they are available sooner? Some implications of this disruptive technology would be the following:
- Significantly less auto dealers – If people just stop buying cars and instead just hire cars, why would you need Auto Nation?
- Auto Insurance would significantly change – If no one buys the cars they are riding in, the insurance liability would fall on a few companies that compete in the car hire space but the auto insurance market will impacted negatively.
- Gas Stations and Mechanics Garages – if no one owns cars, then you wouldn’t need to get them fixed and if all the cars are electric, you don’t need gas stations.
- Tire Stores and Auto Part Stores – Each Uber depot will be maintaining all their own fleet as well as Lyft and any other would be provider in this space. Why would Auto Part stores and tire stores need to exist?
- Oil Change stores – If everyone is hiring self-driving cars that are electric, you don’t need to go to the Jiffy Lube.
I am sure there are other implications but in terms of a disruptive shift…Uber is doing more than just displacing Yellow Cabbies….