Feeds

Are driverless cars the death knell of the motor biz?

Wired cars with brains aren't tied to their owners

Top three mobile application threats

Looking at the numbers

I don't pretend that the multiplexed car will eliminate car ownership entirely. Some people will still need to own cars, and some people will want to no matter what. But if the price is right, an awful lot of people will think “why take on debt to buy something if I don't need to?” – not to mention the running costs, insurance, registration and the rest.

The Royal Auto Club of Victoria (RACV) puts the cost of owning one of Australia's most popular cars, the Holden Commodore, at more than $AUD200 a week.

In that scenario, and excluding other trips (which will, after all, be spread across the second car that most car-owning households maintain), the daily commute comes at a price of $20 per hour.

So let's work to a price: the autonomous car comes at $10 per hour (not per kilometre, because as any taxi stuck in a traffic jam will attest, that's an unprofitable way to run a business), but instead of operating two hours per day, it can be in profitable service for six hours a day.

Ignoring times when there are multiple passengers, that's a daily take of $60: nearly $110,000 over five years. If you can put the car on the road for $40,000, the remaining $70,000 should be enough to operate it with a profit margin available, and the customers are getting transport cheaper than if they bought their own car.

And on shared trips (with a discount for each individual), extra over $10 per hour is cream.

The same exercise is harder to calculate for America, either because of the data the Census Bureau publishes, or because I'm not so adept at finding US census data. While it's easy to find out that the average commute across America's 50 largest cities is 23 minutes, the Census table I found din't state the average drive commute time (“Travel to Work Characteristics for the 50 Largest Metropolitan Areas in the United States by Population”).

However: since 73 percent of Americans in the sample drove alone, their drive time can't be too far away from the average. Every other sample is too small to make a significant difference.

According to the AAA, the annual cost of owning a car is $US9,000, and the quicker commute means a longer idle time – which means, on the same basis as I used for Australia, the cost of owning a car for commuting is $US32 per commute-hour.

So on a like-for-like basis, America is a better place to try autonomous-car-as-a-service than Australia. It's also got a much bigger population, making it easier to justify investing in a decent size fleet to begin with.

In either case: it's at least feasible that once the (considerable) startup costs are covered, a business model exists under which people will use autonomous cars, but never own one.

That's a deadly threat to the motor industry: like all businesses, they need growth to survive. A contraction in the market following the 2007 financial crisis was enough to send car-makers to governments seeking bailouts.

If a driverless fleet cut new car sales by just five percent, it would be a crisis for the industry. A contraction of ten percent would be catastrophic. ®

3 Big data security analytics techniques

More from The Register

next story
Sorry London, Europe's top tech city is Munich
New 'Atlas of ICT Activity' finds innovation isn't happening at Silicon Roundabout
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
prev story

Whitepapers

Designing a defence for mobile apps
In this whitepaper learn the various considerations for defending mobile applications; from the mobile application architecture itself to the myriad testing technologies needed to properly assess mobile applications risk.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.