Peak Oil Usage

“door within 40 seconds" somehow I suspected don’t live in a distant suburb or a rural area.

I suspect that the dense urban areas will fall first, the suburbs second, and the rule areas last or maybe never. I suspect the suburbs will be fairly easy to overcome. Let’s say that in the suburbs in a population of 500 homes, X amount of users need a vehicle at Y time of day. Fleet owners will have this data, they will anticipate that demand, and AEVs will be in the area to provide that need. They will know how many vehicles to have in the neighborhood and they will keep deep statistics on how long each person has to wait on a vehicle. Having one or two extra vehicles in a neighborhood, parked and ready, can provide a very fast response time. I genuinely think 40 seconds isn’t too much of a problem to solve.

-AJ

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You can read the entire report here: https://static1.squarespace.com/static/585c3439be65942f022bb…

Upper and upper-middle income people aren’t going to do without personal cars to save $5000 per family!

You’re thinking of TaaS as something less convenient. It’s actually more convenient.

Let’s say you live in a big house on some acreage outside of town. Instead of driving yourself to work, the car drives itself. You sit in the back seat and do email or phone calls. When you arrive, you don’t have to worry about parking the car.

Let’s say you’re flying on business. You get dropped off right in front of the terminal, instead of having to park in a far away lot, and pay for it.

Let’s say you need to pick your kid up from school. Instead of you having to drive there, a driverless car, whose doors open only with the kid’s cellphone (yes, not for really young kids) picks her up and takes her home.

Let’s say you have an occasional need for an SUV or a pickup. Well, you just call up the kind of car you want when you want it. Get driven to the mall in a small comfortable car, get driven home in a big enough SUV to hold all your purchases.

And don’t forget the need to get your car serviced, dropped off the service center, etc. No need for any of that.

Now, some of these things are already enabled with Uber/Lyft services. I know one exec who Ubers to/from work every day precisely to be able to do work during his commute. I live far enough out from town that getting an Uber to my home when I want it is problematic - I may have to wait too long. These automated cars can be reserved/scheduled. And then there’s the people element. I make business travel arrangements online instead of through an agent because it’s cheaper and easier to not have to explain to a person what I want.

There’s a whole generation of young people who care more about experiences than things. And even though I come from a generation where in my youth I lusted over cars, and I’ve always owned at least one car that was “fun”, I would be happy to own just that one car and get rid of my others for a robot-driven vehicle that’s available on demand and for which I don’t have to garage or deal with upkeep, and which lets me be productive (or be entertained) during my commute.

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Cut down on cars? Next time I find a chick who gets excited to see my stamped Uber app. Not.

As it is now I can get an Uer here in 5 minutes any time I want. Yes, if I lived in New York…but then again if I lived in Manhattan I would own a car anyways.

These are the same sort of prognostications that picked “peak oil” something we use to talk about all the time, just a few years ago. I scoffed mightily at that one. And I have not heard anyone talk of peak oil for years now.

The same sort of prognosticators that give such glorious prospects to public transportation projects that always fall just about 92% short of their prognostication.

The cost of owning an automobile is relatively low on the cost of living, at least outside of dense urban areas or where taxes are not through the roof. The premium cost of owning an automobile vs. the cost of not is even less. Making it a rather cheap “luxury”.

Put it this way, if people were so concerned about the cost of owning a car, WHY ARE ENORMOUS SUVS SO POPLULAR! They cost way more more money to buy, they burn way more gas, and more 9ften than not they are hauling nothing and have no passengers. And yet, there you go. I rather doubt any SUV owning person not located in a dense urban area is going to change their minds.

The developing world? Owning a car is a status symbol! Good luck taking that away from people.

Again, until my Uber app impresses chicks, cars are here to stay. And the car that surveyed as the most attractive to women for a man to be in? Pickup truck! I am not making this up. Not Porsche, not Tesla, but Pickup truck!

The car I most often see women driving - SUV.

If cost were such a big factor here, and we all could admit to this to ourselves, we could probably all get by in a utilitarian fashion driving Corollas. We choose not to.

Tinker
Btw/ my ex does drive a Corolla. She has my kids convinced it is the best car in existence. I think it is a fine car. But I am not driving a Corolla! Not after she is the one that moved me from a Corolla to a Lexus! She told me my image required it. She of course now turns to the simple life. More power to her, but I, and pretty much everyone these days choose to drive more opulent vehicles despite the fact we could easily save $300, $400, $500 or more per month if we did so.

If one has ever run a data interpretation marketing study, or social study, I think the data is very compelling on this point, that what, at least the American people want in a car, is not lack of a car, or cheaper car or cheaper driving experience. They would like less traffic, while owning the most opulent car reasonable to their earning ability.

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“door within 40 seconds” somehow I suspected don’t live in a distant suburb or a rural area.

Well, those same rural areas didn’t stop cell phones from taking over. The attributes that make rural areas hard to solve also limit the potential impact - just not enough people.

Is there hard evidence that Uber has reduced car sales? Because in fact L5 cars are taxis and Uber sans driver.

Read the report (link provided in my previous response in this thread). L5 BEVs have a number of advantages over humans driving their own vehicles. Maintenance frequency and costs. Cost while in operation. Insurance costs.

Me I am an old fogy who invests so that I can afford stuff like my own car. And will not be giving it up.

And there are people still using answering machines instead of an answering service. And there are people who call a travel agent instead of booking online, or go to ATMs instead of banking online. There are even people using fax machines instead of email. Heck, there are people still using film. But they’re just blips on the trend.


It is not a simple matter of spreading the total miles traveled over a set of cars that are used 100% of the time. You need to be able to handle the peak usage/rush hour traffic. That will take just as many cars as we have currently, right?!?!

First, autonomously driven cars will be able to go faster on the same roads, because you won’t have slow pokes in the left lane, rubber-neckers, etc. Second, you won’t have “return” trips, like dropping your kids off at school and then having to drive yourself home. And maybe AEVs won’t improve traffic much, but they won’t hurt it. And if you’re getting work done in the car or catching up on the news or a movie, a slow commute will at least be more tolerable.


I suspect the TaaS software will allow for lots of luggage, as that is a frequent-enough use case. But how many TaaS services are going to give me an option to request a bike rack and, even if the vehicle that arrives has a bike rack, can I be sure it can accommodate my bicycle’s over-sized tubing?

Low volume edge cases won’t kill the trend. Besides, the best bike racks hold the wheels, not the frame. Just request a vehicle with a 2" tow hitch and use your own rack if the difference means that much to you.

How long would I have to wait for another car with a bike rack if the first won’t work, especially if I’m in a remote location on the Upper Peninsula?

Don’t you imagine that reservations could be made in advance?

I might feel safer driving the roads if most of the cars were autonomous, but it would depend on their predictability.

The real issue is going to be how human driven machines are phased out. We’ve already seen London tax regular cars heavily, and there are now proposed bans on diesel cars entirely from 4 European cities, even some to ban all cars in cities to stop that as a terrorism mechanism. I can easily see big cities banning human driven cars during certain time periods.


But “sitting in the garage not being used” would equally apply to jet skies, boats,and motorcycles, all of which have adored my garage at one time or another.

Apples to Oranges. Remember, we’re not talking a rental where you have to go out of your way to the rental place, we’re talking the rental vehicle coming to you. And, don’t overlook the economic differences. Using BEVs greatly reduces the cost to fleet owners in terms of maintenance, insurance, etc… Many younger people would rather rent a jet ski a couple times a year rather than own one that’s used maybe 40 hours total a year.

And then there is the main car, often loaded with options of no practical value, moon roofs , fancy wheels, leather upholstery etc. That so called "economic man " is quite rare.

Rental companies already provide opportunities for choosing Audis or BMWs instead of Hyundais.


And, don’t forget, the report doesn’t say that all ICE vehicles are going away. It says that about 40% of the vehicles will still be powered by oil, but they will account for only about 5% of the miles driven. So, you’ll still have your Ferrari or motorcycle or even monster truck, it just won’t be driven very much.

We are all going to have time to adjust to this reality. Heck, look back just 10 years and tell me which of us thought that we’d have a 200+ mile BEV that functions as a regular car for under $40K in 2017 (Chevy Bolt)? It was just 9 years ago that Tesla sold the first Roadsters, and even so for half a decade people doubted electric cars would grow in numbers. And while some still doubt their eventual dominance, there are a lot more believers, including now BMW and GM. From not understanding what it meant to start off with a full tank every morning to not anticipating Tesla’s world-wide Supercharging network to not believing that battery costs would be under $200/kWh before 2020, few believed that the future would be BEVs.

The same will be true here. As AEVs start hitting the roads in quantity, we’ll get accustomed to them. Did you know that in 1891 President Benjamin Harrison was afraid to touch the light switches in the White House? With technology improvements and time, we humans readily adapt to a better future.

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But how many TaaS services are going to give me an option to request a bike rack and, even if the vehicle that arrives has a bike rack, can I be sure it can accommodate my bicycle’s over-sized tubing?

The same sort of question arises for those with small children who require car seats. My daughter paid at least a couple of hundred for the one she uses ever day for her younger daughter. She drops the kids off on the way to work. Would she have to trust a seat she has never seen? Would she put her in a $40 seat? And adjust it to fit her daughter ever time? Would she have to take her own, and bring it into work with her? When she stops at the grocery on the way home from work she has a supply of carrier bags in the car for them. Do they go to work too, or does she forget about them and use plastic again? What about the dozen things she keeps in the car… water, sunscreen, snack bars, bandaids, phone chargers, pens, pencils, and so on?

I understand that those without cars living in cities handle such problems somehow, but there is much about suburban living that you loose without one. Demographic trends notwithstanding, suburban life is the current standard and it will be around a long, long time.

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"But “sitting in the garage not being used” would equally apply to jet skies, boats,and motorcycles, all of which have adored my garage at one time or another…”

You’re right of course, but that is anticipated ahead of time and your garage isn’t a business. I guess my questions are really on the business side of this. What percentage of the time does the car need to be used (it’s productivity I guess) to get to profit? How many cars does the fleet owner need to make it worth it in a particular zone/area? How many are too many and eat into profit? I guess the AI GPU’s running the world by then will have this figured out? I kid… but not really.

I live in a small city (around 100,000 peeps) and it’s pretty spread out in a coastal area. My area will be on the later end of the time frame in adoption of this tech most assuredly as I believe my area to be the worst case scenario for a fleet business owner (smaller population within a spread out area but not rural).

Really good discussion as many points have been brought up I never even imagined. Oh, and my 2nd car is a Tacoma which is my bum around fisherman’s vehicle and it’s not going anywhere regardless of where this tech is going :slight_smile:

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Well Smorg you and a couple of others have convinced me that full autopilot probably will reduce car ownership. But any figure on the degree of reduction is a wild guess. My equally wild guess would be not much reduction outside of densely packed cities. People do like to"own" stuff.
In my long life I can’t think of many things that I used to like to own and now like to rent. Except perhaps music if streaming is renting. I buy houses and cars , don’t rent or lease. But that’s just me.

It won’t happen suddenly we will have plenty of warning as it does and Tesla is the only car company I care about. So I may re-tune into this conversation in 5 years or so.

It’s easy to see losers (mostly human drivers) driers() TaaS but not so easy to see any specific winners at this point. Competition will be ferocious.

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“Paved Paradise and Put Up a Parking Lot”

Another impetus towards a future in which individuals don’t own autos, but rather use fleet AEVs, is reclaiming those vast parking lots for renewed human habitation and activities.

If the average parking space is approx. 120 square feet, then it takes about 1000 square miles to park all of our 250 million vehicles. But since there are at least as many parking spots at places to which we travel as there are where we live, then about 2000 square miles of USA land is given over to parking spots/lots, about the size of state of Delaware!

Realistically, we’ll never return all parking places to us humans, as there will always be some private vehicles (very clearly evident from previous posters here), and some parking places will be needed for AEV fleets, although such fleets will probably either be in motion or parked temporarily alongside a road.

Mauser,

The issue is more complicated than is being discussed. Apple like complicated in that Apple has a minority share of the total cellular phone market, but makes what, 90% of the profits in the industry.

As things stand today, automobile companies make small cars in order to comply with government regulations on EPA standards. They lose money selling small cars. Small cars have most desirability in tight urban areas.

I doubt very much that car companies will care very much (in fact the opposite) if the car sales lost are those same small cars. That will allow them to focus on their profitable cars.

People currently driving SUVs obviously are not looking to save money, and are not looking to have their independence taken from them. They also are not looking to become one of the masses.

Market segmentation is needed in this analysis.

The only thing that will bring this no car ownership scenario to reality is either harsh government regulations, or utter restructuring of the economy, where we only have super rich and everybody else. This of course is one of the talked about consequences of AI.

But in any event, segment the market, and what you find, is that there is some low hanging fruit who would gladly give up their cars. And then there is the rest of the market driving their SUVs and BMWs who are not price sensitive, don’t care to give up their cars to save a few hundred bucks a month, and will have to be taken screaming to this prognosticated world.

And these customers (unlike the eco buying customers) car companies will fight to keep. Let the eco customers, who lose money on every car anyways, take Ubers that may actually make money for the car companies. So I can see car companies cooperating in this aspect. But they will not cooperate with the rest of the market, and these customers won’t either in this segment of the market.

Long and short, if you look long term, this could be a boon for car profits, even if fewer cars are sold.

Tinker

And maybe AEVs won’t improve traffic much, but they won’t hurt it.

Smorgasboard - I believe the opposite on this. I think that as the price of travel drops considerably and the benefits of autonomous driving become realized, more and more miles will be driven. I do agree with you that the process of commuting will be more pleasant - less stop and go traffic, less rubber necking, etc. I’m really interested to see what businesses can take advantage of the low cost of miles driven and the new industries which pop up because of it. I also want to see how human behavior changes. I might live further away from the office if I can take a nap and then conduct business on the way. I might also order takeout from Starbucks if that coffee only cost an additional quarter to have it delivered to my home or business. And if the cost of retail goods drops considerably because of the lower cost of autonomous semi trucks, I might buy a lot more goods from Target or Amazon. Because air travel is so unpleasant to me, I might pop into an autonomous car and let it drive me to my destination for 12 hours while I sleep for 8 of that and watch a movie or two the rest of the way. I think AEVs really change the game for a lot of things, most of which I bet we haven’t thought of yet.

-AJ

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mauser,
…would give up their clean safe private cars

Fact is private cars are not safe. Over 32,000 annual traffic fatalities in the US. Tens of thousands more with permanent disabilities from auto accidents. I can easily see a day where user driven vehicles (UDV) are prohibited from cities entirely. Highways may be divided such that UDVs are restricted to a single lane in each direction. Why, because people are crappy drivers. And they pose an even greater hazard when the surrounding traffic is autonomous vehicles (AV). People are unpredictable, level 5 AVs are 100% predictable. AVs can travel at higher speeds and more closely packed safe distances than UDVs.

When wait times drops to minutes or less, wait times become irrelevant. By the time you find your keys in order to operate your UDV, the AV is outside waiting for you to get in. Wait time won’t be such a big factor. Last month I was in Norwalk Connecticut to attend my daughter’s graduation from Columbia Univ. I needed to take an Uber to JFK at some stupid early hour like 5:00 AM. My wait time was all of 5 minutes. That was with a human driver in a Prius.

Another thing to consider, the auto insurance industry will be in upheaval. It’s a numbers game as is all insurance. Fewer car owners means risks will be spread over those remaining. Premiums will march upward at a rate that a lot of folks just won’t tolerate. They won’t spend that much of their income on a privately owned vehicle, let alone two of three. As these folks give up auto ownership, premiums will continue to rise - a viscous cycle. Premiums will eventually be out of reach for all but the very wealthy. Eventually, the whole auto insurance industry will collapse (look out Buffett, GEICO is doomed, but probably not in his lifetime). When owning a private vehicle means assuming the full liability of an accident, there’s going to be no one who wants a part of that, not even the uber-wealthy (pun intended).

You raise a valid issue about cleanliness. I’m not sure how that one will be addressed. You can already see this on airplanes when travelling with a passenger load of folks from 3rd world countries. They’re a bitch to keep clean, especially on long flights. I’ve been on flights from China (certainly not 3rd world) where the attendants just had to close off a lavatory for part of the flight. And the Chinese are a lot more hygienically aware than most other cultures (including the US - but I won’t get into that in this post).

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John123,
You’ve obviously not looked at the report. This is addressed via pooling.

Absolutely fascinating, inevitable. As I read the original report I’m compelled to share this, some Rush and Red Barchetta. If you know the song you know what I mean. If you don’t know the song give it a spin, or just source the lyrics and story. The most creative among us often see the future first.

https://www.youtube.com/watch?v=FAvQSkK8Z8U

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IRdoc,
Read pages 6 - 10 of the report. It’s not just gas stations, it’s the entire oil industry value chain that will collapse. The same goes for the auto industry value chain as it exists today, service shops, body shops, auto supply stores, etc. all will be driven out of existence by the TaaS disruption. This is an economic tsunami.

C’mon HeartMD, have your ever used Uber? You have the option to request a premium ride (for an increased price) when you order the vehicle. It’s doubtful that vehicle selection would be decided when the AV shows up at your door. No service provider could survive if you can keep sending away vehicles that aren’t to your liking. A more viable scenario is that at the time you make your request you will be presented with the available choices and their amenities and estimated fees. Don’t like your choices? There’s a competitor just a mobile app away.

TMFDatabasebob

Will you give up your car when you have to assume 100% of the liability for an accident because you can’t buy auto insurance anymore as all the insurance companies go out of business?

This disruption has enormous ramifications.

Tinker,
But in any event, segment the market, and what you find, is that there is some low hanging fruit who would gladly give up their cars. And then there is the rest of the market driving their SUVs and BMWs who are not price sensitive, don’t care to give up their cars to save a few hundred bucks a month, and will have to be taken screaming to this prognosticated world.

You’re only talking about the cost of acquisition but ignoring the cost of ownership which is destined to go through the roof. If you read the report, the oil industry value chain is likely to collapse by 2030.

So, OK you’re Beemer is an EV. What about the cost of insurance? AEVs will have accident fault rates near zero. The human driven vehicles will have to carry the risks of accidents. But, with less and less of them on the road, the insurance premiums will inevitably march rapidly upward. But eventually, the auto insurance industry will collapse. Then you carry 100% liability every time you get behind the wheel.

Ouch! I think I’ll leave it parked . . . eventually scrapped out for whatever you can get.

It’s not about saving a few hundred bucks a month anymore, it’s about carrying an enormous load of risk every time you feel like driving that hunk of metal.

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I actually read all through this interesting thread. I have an advantage since I live part of the year in Manhattan and part of the year in the country, and have lived part of the year in the suburbs of a sprawling western city. Here are my conclusions:

People living in the country
Anyone actually living in the country would feel completely isolated and cut off without their OWN means of transportation. They are not going to wake up in the middle of the night with a sick kid and hope there is a TaaS car that happens to be available to get them to the hospital. If it’s available in a nearby town, it might take 20 or 30 minutes just to get TO them. Or have the system down because of hackers and they can’t leave to get into town. Or if there is a hurricane evacuation order and there are only a twentieth of the TaaS cars that are needed. Are they going to do without a car of their own? IT JUST WON’T HAPPEN. On the other hand, it may well be an electric car. Why not?

People living downtown in a big city like New York
Having a car in Manhattan is insane. It costs as much to garage it as an apartment costs somewhere else. Getting it out and going somewhere else in the City means dealing with traffic, parking, etc. And there is lots of public transportation. The subway is a lot faster than a car on weekdays. And you can walk. A uber-like service or a car rental on demand for longer drives would work fine.

People living in the suburbs
For commuting into work in the city and back it would work fine. But to run your kids three blocks over to go swimming at a friend’s on the spur of the moment. You’re going to call a TaaS car? No way. And you stay and talk to the other adults for ten minutes and then need a car to head back. You call a TaaS car again? Give me a break! And what if you’ve mislaid your smart phone with the Taas App, and you are isolated. And what if come home from the store and you have to run back because you discover you forgot something. You call for another TaaS car? And Monday evening there’s normally little call for TaaS cars according to your service’s computer, but this Monday there’s an emergency meeting of parents at the High School, or a make-up football game, or whatever, and there are only a fraction of the needed cars available. THIS WILL NEVER BE THE ONLY TRANSPORTATION. PEOPLE WILL ALWAYS KEEP THEIR OWN (ELECTRIC) CARS.

Conclusion
Electric cars, yes. Autonomous electric cars, maybe it’s your own car and you can tell it where it go, and if you can take over driving if necessary, okay. TaaS, only in big cities and for regular commutes. But that’s just how it seems to me.

What does this mean for investing?
Bad news for gas stations. Bad news for chains like Casey’s. Bad news for high cost oil drilling. Bad news for oil rigs, pipelines, etc. Bad news for car part manufacturers. Car manufacturers will make electric cars and do fine. Maybe even make more profit per car sold (cheaper to build). But bad for car dealers who make all their money on service and repairs. Good for lithium producers? Good for battery manufacturers.

Just my amateurish analysis.

Saul

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Pipelines will still be needed. How does everyone charge their electric vehicle? Unless all power plants go nuclear, natural gas going to be needed and utilized.

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brittlerock interesting post. The ramifications of L5 have yet to be worked out.
safety is relative of course- safe compared to what? I drive a Tesla. it is a lot safer than almost anything short of a tank, including a poorly maintained rental. With L5 some cars will be safer than others. And mine is /will be safer because I carry emergency equipment on board .Including means of dealing with human threats. Come to think of it road rage may become a thing of the past. But I will keep my car, if it was all economics I would drive a Honda Fit.

Using an example of crowded aircraft full of sometimes dirty and unpleasant jerks is why I avoid public transit when possible. Including commercial aircraft when I can. I suppose deep urban dwellers and those who jet a lot get accustomed to it but I don’t have to.

Wait time in minutes maybe irrelevant to you but not go me.It takes me 30 seconds to get in my
car and go. i am willing to pay more for ownership.

At the core of this is that many like to own things not borrow them. Some of us find it easier to concentrate on making more money than on pinching pennies. Some vice versa.

At this point all of this is mostly idle speculation. How do I get to be a more significant Capitalist off it at this time?

Money and investment wise -1) insurance companies -Don’t own any 2) Home-might favor a trend back to suburbs? That depends whether time or rush hour hassle is more important 3) best autopilot -my guess is Tesla short term, long term they will be much the same 4) rental vendors 0- to be determined, competition will be brutal

So as a Saul’s INVESTING discussion all this , including my posts, is useless unless it leads to superior investing. Personally I take it as a given that electric cars with AI autopilot will dominate car sales, and sooner than most think .They are just better than CO2 spewing ICE and inattentive careless humans.

Anybody, any specific ideas? I already own TSLA and NVDA .

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