August 18, 2016
Uber Buys Autonomous Truck Company Otto

Uber also made a deal with Volvo to cooperate on self-driving cars.

Self-driving cars are an existential threat to Uber if Uber doesn't develop them first. Suppose Ford makes self-driving cars viable a few years before does and rolls them out in many cities. Uber gets wiped out by Ford's ability to charge less for a ride. Uber's big competitive advantage from a large set of recruited drivers could vanish as fast as sufficiently safe autonomous vehicles can get manufactured.

Sufficiently safe: that's the challenge. But autonomous vehicle makers who limit themselves to some urban markets can lower the bar for their initial roll-out by just excluding any streets and corners that are too tricky to handle. They'll lose some business to be sure. But better get to market first.

Uber is in a tough situation even if they manage to get the first autonomous taxi to market. Why? Because autonomous taxis lower the barriers to entry for competitors. Many companies are rushing to build autonomous vehicles. Toyota has deep pockets. Even with the diesel engine scandal VW still has deep pockets. Daimler does too. These companies can make millions of cars per year and can flood urban areas with fleets of autonomous taxis that they own.

Share |      Randall Parker, 2016 August 18 09:03 PM 

Audacious Epigone said at August 21, 2016 6:07 PM:

How much better than human-driven cars will autonomous cars have to be before the risk they pose becomes publicly acceptable? Parity doesn't seem like it'll cut it, not even close, since with humans there is perceived agency. If I'm driving and I get into a fatal accident it's my fault. Tragic though it is, people will be able to accept it. But if my autonomous car gets into a fatal accident, people won't accept it.

Anthony said at August 30, 2016 9:29 PM:

Autonomous car are already exponentially better drivers than humans.
It really should be illegal for humans to drive.

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