Chart Of The Day: The Future Of The Auto Industry
Morgan Stanley analyst Adam Jonas thinks that this chart represents the future of the auto industry, where we one day move into autonomous, shared transportation.
I’m not discounting the idea of the self-driving car. I think it will arrive at some point in the intermediate future, with far less capabilities than we may expect, but at much lower cost. The notion of self-driving, shared-ownership vehicles is a fantastical notion held by childless coastal elites who are utterly disconnected from the reality of the other 300 million Americans who must deal with children, elderly relatives, poor weather, long driving distances and a general aversion to anything that deviates from private vehicle ownership.
This is not likely to change, and it’s further compounded by the myriad regulations governing the automobile, which cannot be undo with the wave of a magic wand (or campaign donations). Adam Jonas is also notorious for making highly hyperbolic predictions about Tesla’s share price. I wouldn’t be surprised if this is a way to gin up business for Morgan Stanley when it comes time to underwrite some car sharing IPOs. And lastly, tuning out anything with the word “disruption” in it is a pretty solid heuristic.
Tell me why I’m wrong.
More by Derek Kreindler
Comments
Join the conversation
Yeah, sure. Right now, Mr. Jonas will have to pry my Impala from my cold, dead hands! In the future, who knows? After all, who would've thought that someday we would all have to be forced into running around everywhere in our 4-wheeled metal boxes, scurrying here to there, always in a hurry, always on a tight schedule we often put upon ourselves? Right now, most of us are trapped in the society we live in, suburbia, where a car is mandatory or we are stuck. The biggest challenge right now to getting around efficiently in the framework we have is the semi-truck. Get those things off the road during rush hours and things will vastly improve for all commuters. Seriously. Not sure how that will be accomplished. Strictly overnight hours, perhaps? Anybody's guess, if even remotely possible.
Shared autonomy might be more efficient than owned autonomy, so it could make everyone take public transportation, but even with owned autonomy it could be the death of a lot of companies. Why would brand identity, design and fancy engines matter when you don't even drive the car? All cars will be boxes no fancier than a bus.
The problem of owning a car in a big city is not buying the car, it is parking it. With parking being a problem, why wouldn't you share one via public transit (subway, bus, light rail, etc), hired ride (taxi, uber, etc), or walking instead? I know if I live in a big city and drive I'd way a valet back home mode, and probably will pay $3k for that feature alone. No, not everyone wants to live in the suburb or wants the trade off, at least outside of the US / Canada this gets very expensive.
I'm looking out my window at work at a fully functional V2V test fleet that represents all of the major manufacturers. But if I believe what I read here, this technology will never be accepted by the public. I see autonomous vehicles frequently on our test track, developed on a military contract. Surely that technology will never transfer, right? Wake up, folks. It's coming a lot faster than you think.