Beware the Credit Crash!

GreatApe

westernpromise wrote: »

The point I am making is that although it is already cheaper to ditch your car in favour of reliance on taxis, almost nobody does. It doesn't matter if the taxi is free if it does not turn up and if you thus have no control over your own journey

Uber is not currently cheaper than owning your own car, it is cheaper to get rid of a second car that sees less use than your main car and people will do that as my household has done. Also useful benefits like if going to the hospital taking an uber is better as it avoids parking fees and the risk/time of actually finding a parking spot.

Incrementally most transport more or less is free. Once you've paid for your annual season ticket, the bus and Tube are free (which is why I'll never buy a bike to save money - I'll still need a Tube season ticket so the bike will cost money, not save it).

Yes if someone already has a car that is mostly depreciated then they will have low £/mile cost possibly as low as 10p a mile in just fuel but cars are not long lived so come the larger costs like insurance maintenance or replacement at that juncture some people will switch just as we ditched the second car earlier this year when the insurance renewal came around. Also I think a big part of the early adopters will be the young who will be happy paying 40p a mile in a nice nearly new robo car rather than £5,000 for their first years motoring in a crap 10 year old car especially as the risk per mile will be 1/20th of a new learner driver.

Also it will be useful for families who drive their kids to school. If a mother spends 20 minutes taking the kids to school and 20 minutes returning home why not pay the robo taxi £3 and save yourself 60p in fuel and two thirds of an hour of your time.

But if I absolutely have to go somewhere, and go there now, I will use my car even though incrementally it is not free (petrol plus parking) to do so. I won't hang about waiting for a bus to turn up, and nor would I wait for a driverless taxi, even if free.

You probably have an idea of the old taxis that take 15 minutes to arrive and sometimes might take 30 mins if they are busy. it seems in London the current fleet of 30,000 ubers or thereabouts arrive in 172 second on average. A fleet of 300,000 robo taxis in London might see the arrival time at sub 1 minute which is instant in most peoples books.

There will probably be times of the day when they are free, but these will be at 6am on Sunday, like Tesco delivery slots.

one big part of the success of uber is that it is faster than traditional cabs. if the net is to be believed the average wait time for uber in London is 172 seconds which is less than 3 minutes from starting the app to the cab arriving.

Other advantages are time saved not having to deal with insurance or maintenance or buying and selling a car or worrying about security or parking fines or tickets etc.

We know uber did not just take market share from existing cabs they added to the market, more people use taxis now because of uber being able to cut the cost a little and cut the wait times. Robo cars are just another step toward even cheaper taxi trips and even smaller wait times. That will expand the market. Below certain figures it will just exponentially explode.

I think 50p a mile and sub 3 minutes summon would be sufficient for me and many other families to ditch their main car. As the network grows the prices will fall further and the summon times will drop further which will lead to more people joining up and getting rid of (or never buying in the first place) a private car.

antrobus

GreatApe wrote: »

...It is just software once the software is cracked the only cost is putting in a couple of smartphones worth of tech into cars...

The same is true of most things. Once you've spent a billion or two developing that cure for cancer it costs only a few pence to manufacture those pills. It doesn't change the fact that a considerable amount of capital needs to be invested to get you to that point. The same applies to software; hence your claim that it is not 'capital intensive' is just plain silly.

Mind you, I still don't understand what you think any of it has got to do with the alleged upcoming credit crash due to the current popularity of PCP deals.

westernpromise

Canals are pretty cheap once they're dug and filled yet those never caught on.

300,000 cabs sounds like a nightmare. Imagine the jams. Where will they all park when not in use?

GreatApe

westernpromise wrote: »

Canals are pretty cheap once they're dug and filled yet those never caught on.

300,000 cabs sounds like a nightmare. Imagine the jams. Where will they all park when not in use?

Your canal comparison is silly the robo taxes are no different from what we have today its the same as a taxi minus the £250,000 human computer. The software and hardware will be so cheap in time that all cars will have self drive technology so it will be a choice of owning a self drive car all for yourself or making use of a self drive taxi. The latter is likely to take 80-90% of the market.

300,000 robo taxis in London would very likely displace in excess of a million private cars in London. So space and traffic issues will be eased not made worse.

Also uber currently offers uber pool in London. These cabs pick up two-three passengers who are going to almost the same place from almost the same place at almost the same time. I expect that will be the model for robo taxi fleets. With the taxis typically holding 2-4 passengers it will mean car miles fall while people miles stay roughly static or increase a little.

I don't see any real reasoned objections from you just a continued protection of your initial position. All cars will go self drive it will be a safety feature and also help with law enforcement. The question is then how many households will opt for £4k a year private ownership vs £2k a year robo taxi service or even £1k a year shared robo taxi trip service. Most will opt for the cheaper and less time consuming robo taxi fleets and many of them will share the robo taxis as many people already share via uber pool. Lower traffic lower costs higher safety. I think its quite likely to be in full force by 2030

economic

GreatApe wrote: »

Your canal comparison is silly the robo taxes are no different from what we have today its the same as a taxi minus the £250,000 human computer. The software and hardware will be so cheap in time that all cars will have self drive technology so it will be a choice of owning a self drive car all for yourself or making use of a self drive taxi. The latter is likely to take 80-90% of the market.

300,000 robo taxis in London would very likely displace in excess of a million private cars in London. So space and traffic issues will be eased not made worse.

Also uber currently offers uber pool in London. These cabs pick up two-three passengers who are going to almost the same place from almost the same place at almost the same time. I expect that will be the model for robo taxi fleets. With the taxis typically holding 2-4 passengers it will mean car miles fall while people miles stay roughly static or increase a little.

I don't see any real reasoned objections from you just a continued protection of your initial position. All cars will go self drive it will be a safety feature and also help with law enforcement. The question is then how many households will opt for £4k a year private ownership vs £2k a year robo taxi service or even £1k a year shared robo taxi trip service. Most will opt for the cheaper and less time consuming robo taxi fleets and many of them will share the robo taxis as many people already share via uber pool. Lower traffic lower costs higher safety. I think its quite likely to be in full force by 2030

i agree with this totally.

things are moving really fast. only recently has AI become more talked about. there is so much innovation and so many small businesses and ideas that its just crazy. all because of the advancement of tech.

westernpromise

GreatApe wrote: »

I don't see any real reasoned objections from you just a continued protection of your initial position.

My reasoned objections are above. I'm older than you I suspect and therefore I have been hearing this Utopian guff about something or other for years: the internet, the home PC, the Segway, the Sinclair C5, the Sinclair Spectrum. They were all going to change the world right away; in the end, they were at best eventually quite good, much later than expected.

As I have observed, before that it was going to be fusion nuclear power that would produce electricity too cheap to meter. Before that there were going to be interplanetary rockets, maglev trains, airships, canals, steam trains, and in fact steam generally was going to change the world.

Some of the stuff one reads about this reminds me of episodes of Tomorrow's World from the 1970s in which they predicted that by 1990 we'd all be eating square sausages, wearing digital watches and having our letters typed by secretarial robots.

antrobus

In an attempt to get this thread back on topic, here's a report from the BBC.

Car finance deals soar to new record
http://www.bbc.co.uk/news/business-39895327

According to the Finance and Leasing Association (FLA), motorists spent £3.6bn on car finance deals in March, a rise of 13% on the same month in 2016, and a "new monthly record", and that the "vast majority of the purchases were via so-called Personal Contract Purchases (PCPs)."

Apparently the FLA does not think this is a problem, "Lending is responsible. This is a sustainable model going forwards."

michaels

I did try to ask whether the asset backing would help or not. Getting title is I guess fairly straightforward but I suspect that unless there are big customer deposits (which seems to be less the case these days especially for some manufacturers then taking possession will result in a capital loss for the finance company - lets say of order 20% of the sum advance on average.

Working out what level of loss can be sustained is all a bit smoke and mirrors as the suppliers play around with the GFV balloon payment and APR to give a rate they think they can sell rather than the apr necessarily giving any indication of how much profit there is in the deal (to cover any defaults) if all the payments are made. Are we same in assuming that the cost of funds is essentially zero for some lenders?

In other words it is completely opaque to me whether if we start to see an increase in delinquency rates how much that will eat into any 'profits' that are currently being earned or alternatively whether it would only take a small shift to lead to an abrupt solvency problem for the lenders.....

GreatApe

westernpromise wrote: »

My reasoned objections are above. I'm older than you I suspect and therefore I have been hearing this Utopian guff about something or other for years: the internet, the home PC, the Segway, the Sinclair C5, the Sinclair Spectrum. They were all going to change the world right away; in the end, they were at best eventually quite good, much later than expected.

Home PCs and the internet has changed the economic world. Google Amazon and Apple alone are worth $2 trillion.

As I have observed, before that it was going to be fusion nuclear power that would produce electricity too cheap to meter.

that was a misunderstanding on the part of lay people, the actual fuel will be cheap, just as the fuel for nuclear fission reactors are cheap. However the power wont be cheap becuase the buildings are huge and huge buildings are expensive. staffing costs are also large, a gas fired station needs only 40 staff a nuke of the same size needs 1,000 staff and they wont want to work for free.

Before that there were going to be interplanetary rockets. maglev trains, airships, canals, steam trains, and in fact steam generally was going to change the world.

the problem is humans look at day by day and do not apriciate change at speeds less than that. China is poorer than the UK but over the last 30 years it has transformed beyond recognition im sure your counterpart over there is saying the same thing not apriciating what has happened. However let him live a week in 1987 china and a week in 2017 china and lets see what he thinks.

your argument is like saying smartphones didnt really change anything. Ture it did not evolve us into superman but over a period of just 10 years it has changed society and economics and jobs and business practices. AI self drive computers wont turn us into gods however it will be a huge upswing in productivity and wealth one not seen since the 1945-1970 boom that was created largely by the deployment and availability of the electricity grid. the 2020-2040 boom is going to be driven by the AI grids of which self drive vehicles will be the first major one

Some of the stuff one reads about this reminds me of episodes of Tomorrow's World from the 1970s in which they predicted that by 1990 we'd all be eating square sausages, wearing digital watches and having our letters typed by secretarial robots.

but all that exists. digital watches, check. Secretarial software you speak and it types, check, square saussages? you could make them square a hundred years ago

Thrugelmir

westernpromise wrote: »

Canals are pretty cheap once they're dug and filled yet those never caught on.

Were better than horse and cart at the time. Plenty in Europe get everyday use. The UK is not best suited to such a mode of transport as not flat enough nor wide enough.