Uber disrupts their own business model

Order an uber, maybe it has a driver, maybe it doesn't

Uber driverless car-1x-1

Uber is in 507 cities worldwide right now and their successful model of employing drivers is about to change. In a post titled ‘Rethinking transportation‘ Uber CEO Travis Kalanick announced they were acquiring Otto.

The startup has just over 90 employees, but those employees have been working on a very important puzzle that fits with Uber’s grand plan. That plan is to replace human drivers with cars that drive themselves.

Together, we now have one of the strongest autonomous engineering groups in the world

Kalanick says when it comes to safety (the inevitable question when autonomous vehicles are suggested), over one million people die on the world’s roads every year. The harsh reality is that 90% of these accidents are due to human error.

Whether its really from a safety or from an economic motivation, Uber and the ride sharing industry in general will benefit significantly from driverless vehicles.

It may surprise you to know that Uber already has test vehicles driving millions of miles and not in 2021, but this year will start offering the first vehicles to transport customers without drivers driving. Legislation means there still needs to be a human behind the wheel for now, but it’ll be the car that’ll be doing the driving.

If the driverless technology goes to plan, this has to be the easiest job you could ever get. For now, Uber is using modified versions of the Volvo XC90 SUV, but the company is brand agnostic and willing to use any vehicle that meets their requirements.

The trial will launch in Pittsburgh this month, chosen for its concentration of engineering expertise.

Tesla founder Elon Musk says they can deliver autonomy in the next couple of years, around 2018, while Ford this week announced a commercial fleet of driverless vehicles would be ready in 2021. So how did Uber leap frog Ford, GM, Google and even Tesla ? They scaled up fast. Basically the company’s been on a brain power acquisition program since early last year and now has amassed hundreds of employees skilled in engineering, robotics and mechanics.

Uber in Australia, like many countries has created issues for the traditional taxi industry and while states are finally coming to accept and legalise ride sharing, the Taxi industry certainly isn’t ready to compete with cars that have no drivers. It is worthwhile taking a second to consider the possibilities this opens up once fully driverless vehicles are available. You pull out your phone, order an Uber, a car from an available fleet comes to get you and your friends, family, coworkers etc and takes you to your destination, you get out and get on with your life.

That really does change transportation and the way we think about it. Sure not dealing with a financial transaction anymore makes the experience better, but with an extra spare seat in the car, it could also cut down on the number of cars necessary to service people in any given area and make plenty of people reconsider their need to own their own car.

More information at Bloomberg.

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Vehicle