From Internal Combustion Engines to On-Demand Electric Autonomous Vehicle Subscriptions

The days of the motor that powered the growth of the suburbs is coming to an end as the benefits of electric vehicles far outway those of the internal combustion engine.

UBS is predicting that by 2025, 14% of vehicle sales will be electric up from 1% today. While some would say that UBS is bullish on their call, others would argue that UBS is undervaluing the autonomy economy. Between 2025 and 2030 society will hit the tipping point with autonomous vehicles, as a majority of vehicles will no longer be sold to consumers.

Instead, consumers will subscribe to autonomous vehicle brands and summon vehicles on-demand. No longer will vehicles sit idle 95% of the time costing the owners/leases of the vehicle money. The average cost to own and operate a large sedan in the United States driven 15,000 miles a year costs consumers $9,451 a year, equaling $0.6300 a mile.

While the cost to own and operate an electric vehicle costs $8,439 a year equaling $0.5626 a mile. Even with traditionally higher costs, it is still more cost-effective to own and operate an electric vehicle than an internal combustion engine vehicle today.

As autonomy matures and manufacturers start to shift their business models to subscriptions from selling vehicles, the cost of transportation for individuals in a vehicle will plummet as a majority of vehicles will be shared.

While vehicles will be shared, there will not necessarily be multiple individuals in the vehicle at the same time. The concept of UberPool and Lyft Line is not the future of transportation. It’s an idea and a concept that appeals to a niche group, not the public as a whole.

Consumers like their independence and the convenience vehicles offer them for their lifestyles. Subscribing to a brand will allow individuals to summon the vehicle that fits their need for that time and place. For example, if a family of four is heading to the beach, they can summon an SUV. If mom and dad are going out for dinner, they can summon a sedan.

The vehicles consumers subscribe to will be electric and operate on a software platform that is fully integrated into the lifestyles of the brand’s customers. Brands such as Aston Martin have announced that every new vehicle by the middle of the next decade will be hybrid or electric.

A quarter of these vehicles will be 100% electric. As Andy Palmer, CEO of Aston Martin positions the iconic brand for the future, a subscription service will not be far behind as he is in the middle of a strategy to reposition the brand for the future.

In its 105-year history, Aston Martin has only sold roughly 70,000 cars. Which is a remarkable number considering the prestige of the brand. Over the course of history, Aston Martin has only sold 667 cars a year on average.

With the shift to electric and the advancements of autonomy, Dr. Palmer could strategically announce that one will no longer be able to buy an Aston Martin, instead, one will have to subscribe to the brand.

The starting price to purchase an Aston Martin today is $118,650. In the future, with a subscription, this price could possibly drop as low as $2,000 a month with no insurance, maintenance or charging costs as Aston Martin would self-insure and all ancillaries would be bundled into the monthly subscription.

Today, if a consumer were to buy an Aston Marton, the insurance would cost $232.06 a month on average. The annual oil change (10,000 miles) costs $1,400 in addition to tires, brakes, etc which will set consumers back a few thousand more a year. Factoring in gas and parking, the average yearly cost to own and operate an Aston Martin is well over $5,000.

High costs make the brand unattainable for most individuals. In the future, when you remove the cost of entry, the internal combustion engine and the monthly costs to operate, the Aston Martin brand becomes attainable to a larger percentage of the population.

When the brand becomes more attainable and multiple individuals are subscribing to vehicles, profits will increase which will allow Aston Martin to scale the brand. This scenario is only possible today due to the breakthroughs in electric and autonomous technologies.

As a society, we are just beginning to scratch the surface of the true benefits that an electric, autonomous future will offer us.

Whether you are interested in a luxury subscription or a traditional sedan, the end of the internal combustion engine will dramatically lower the cost of vehicles as society shifts towards a subscription model.

From Internal Combustion Engines to On-Demand Electric Autonomous Vehicle Subscriptions is an article written by Brulte & Company Co-Founder Grayson Brulte that was originally published on LA CoMotion.

SpaceX Hyperloop Pod Competition 2017

In this episode of The Road to Autonomy, Grayson Brulte visits the SpaceX Hyperloop Pod Competition in Hawthorne, CA to discuss the future of Hyperloop transportation.

Hyperloop could transform how we design ports and distribution centers in the future as the Hyperloop has the potential to reduce congestion at major ports around the world. To reduce congestion, Hyperloops could be setup similar to the way rail cars once moved goods from ports around the world to distribution centers.

With a Hyperloop, the speed in which goods can travel will greatly improve enhancing overall efficiencies and lowering the costs of goods for consumers.

At some point in the future, Hyperloops will also transfer individuals from dedicated points such as Dubai to Abu Dhabi. Tune in to learn why the Hyperloop could transform how goods are shipped and gather a glimpse into the future.

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Why U.S. must outpace China, Other Nations

Autonomous vehicles will usher in the single greatest change in society since the Industrial Revolution.

For this change to happen, Congress will need to deliver to President Trump a national autonomous vehicle framework bill that includes vehicles weighing over 10,000 pounds.

Upon signature by President Trump, the autonomy economy will officially be launched to the benefit of society, creating millions of new jobs through sustained economic growth. The economic impact of autonomous vehicles and the autonomy ecosystem is projected to grow to $7 trillion by 2050.

The economic growth of the autonomy economy will create millions of new jobs and save the United States $871 billion in annual economic loss and societal harm caused by motor-vehicle accidents.

Today, the roads of America are dangerous. In 2015, an estimated 433,000 large trucks were involved in police-reported accidents, resulting in 4,067 fatalities, a 4 percent increase from 2014. Some 74 percent of these fatalities were occupants of other vehicles traveling on the road. In 2016, over 40,000 individuals perished in a motor-vehicle accident. Ninety-four percent of these accidents were caused by human error.

Over the next 20 years, the number of individuals dying on the roadways of America will dramatically decrease if there is an autonomous vehicle framework in place that permits Level 5 autonomous vehicles to travel over state lines.

When an autonomous vehicle framework is in place, the roads of America will become safer and society will welcome the autonomy economy. The autonomy economy is an evolution based upon B. Joseph Pine II and James H. Gilmore’s experience economy theory, which states that businesses will develop memorable experiences for their customers and the memory of those experiences will become the product.

While the term the “experience economy” was first introduced in 1998, the shift to an experience-based economy has happened over the last several years. B. Joseph Pine II and James H. Gilmore were ahead of their time in correctly predicting the evolution of the economy towards a service-based economy.

When Gov. Rick Scott of Florida signed one of the first autonomous vehicles laws in 2012 — HB 1207, allowing testing in the state — he successfully established the foundation for the autonomy economy. Investments being made by the private sector in autonomous cargo shipping, autonomous vehicles and autonomous drones, and the space industry are creating hundreds of thousands of high-paying jobs with a net positive impact on the Florida economy.

The foundation Gov. Scott has established in Florida is one that the United States can build and expand upon. With investments being made in Silicon Valley, Southern California; Arizona; Detroit, Michigan; Florida; and Nevada; and with foreign investments being made by Softbank and Foxconn, the groundwork for the autonomy economy is actively being developed in the United States.

To unleash the full potential of the autonomy economy, we have to believe in the American dream by not prejudging the technology and its supposed negative impact on jobs. Instead, we need to look back in history and study similar technological advancements.

The Industrial Revolution created tens of millions of more jobs than it replaced over the course of history, and the U.S. economy has grown and matured significantly since then. When new inventions were introduced, such as the electric-powered washing machine, there was an uproar over job loss. In fact, the washing machine went on to create more jobs than it replaced.

The fear of autonomous vehicles replacing jobs and not creating new jobs is a classic case of history repeating itself. For the introduction of new technologies, history is our greatest guide to predict the future.

While we do not yet know the full extent autonomy and autonomous vehicles will have on society, we do know that if the United States does not lead on autonomy, other countries will step up and autonomy jobs will ship overseas.

We are currently seeing this very scenario happening in Singapore as NuTonomy, a Cambridge, Massachusetts-based autonomous vehicle start-up, is testing their technology overseas. If an autonomous vehicle national framework is not passed, we could see this same scenario occur in China, as U.S.-based technology companies have a desire to expand into China to tap into the growing population.

Capitalizing on this desire, China could strategically allow Level 5 autonomous vehicles to operate on every road in the country. If this happened, China could overtake the United States as the leader in the development and testing of autonomous vehicles.

The World Health Organization estimates 260,000 individuals perish on the roads of mainland China every single year. With over 700 individuals perishing on the roads of mainland China every day, that government has a clear motive to allow Level 5 autonomous vehicles.

U.S.-based companies could off-shore their autonomous vehicle testing and investments benefiting the Chinese economy — not the U.S. economy — if Congress does not act.

It would behoove Congress to act and pass an autonomous vehicle national framework for the benefit of society. An autonomous vehicle national framework will create millions of high-paying U.S. jobs, thus having a positive impact on the economy.

It is time for America to come together and collectively usher in the autonomy economy for the benefit of all Americans.

Why U.S. must outpace China, Other Nations is an article written by Brulte & Company Co-Founder Grayson Brulte that was originally published in The Washington Times.

Automating A to Z: Will Airbnb Integrate Autonomous Vehicles?

The $550 billion hotel industry is in flux and the big change has not even occurred yet. While traditional hoteliers fret over Airbnb and their $30 billion valuation, they are once again missing the big picture – autonomous vehicles.

While chain hotels were busy focusing on consistency, Airbnb was busy focusing on authenticity and learning about their customers. In the early days, Brian Chesky, Co-Founder and CEO moved out of the apartment he shared with his co-founders to live exclusively on Airbnb. The co-founder of Airbnb believed in his product so much, he would live on the platform.

This level of dedication to the product is still evident today. If you visit Airbnb’s office, you will notice that the two dozen or so conference rooms are exact replicas of Airbnb listings around the world. How many traditional hotel companies have modeled their conference rooms as exact replicas of rooms around the world?

In keeping with this attention to detail, Airbnb moved into the experiences market in late 2016. Now in mid-2017, the hotel industry is once again playing catch up to Airbnb and the entire home-sharing revolution. As the hotel industry introduces experiences, Airbnb is busy working remaking the entire travel industry.

While Airbnb is currently working on creating new kinds of travel offerings in their innovation and design lab, called Samara, the hotel industry is busy focusing on RevPAR (Revenue per available room) and not the future.

Airbnb has publicly stated that the company is looking into flight bookings as a new service. The next logical step after flight bookings is autonomous vehicles.

If Airbnb does indeed explore autonomous vehicles and launch a service, the service should be fully integrated into the overall guest experience. The vehicles should be branded Airbnb and purpose-built for the experience while blending into their surroundings as not to look like a tourist bus. Allowing travelers to blend in and experience a new destination as a local.

These vehicles could feature AR (augmented reality) surfaces and displays which allow a city to come to live as an individual drive through it. This is the future of travel. A highly personalized experience tailored to each and every individual who ventures out the door.

Experiencing a new destination can be a daunting task especially if you do not speak the local language. Smartphones, augmented reality, autonomous vehicles and breakthroughs in artificial intelligence are bringing us closer together again.

“Cities used to be villages. Everyone knew each other, and everyone knew they had a place to call home”, Brian Chesky has stated.

Mr. Chesky is correct, a city was a place you could call home and you could depend on your neighbor to help out in times of need. While this idealistic world is no longer here, the dream is not far away.

It’s a dream that Airbnb fully realizes and understands the potential of. It’s a dream that is changing the lives of millions of individuals around the world as they are able to generate income from renting out a room while providing hospitality.

To some, this is their version of the village. To others, this is merely a pipedream. But to the hotel industry, this should be a reality. It’s only a matter of time before Airbnb surpasses Marriott in market value as the hotel industry keeps playing catch up instead of innovating.

Which is a change of course for the hotel industry, as the industry used to innovate and embrace new technologies. In 1904, when Colonel John Jacob Astor opened the St. Regis Hotel in New York City every room had its own telephone along with central heating and an air-cooling system that allowed each and every guest to control the temperature in their room.

The hotel also featured one of the first central vacuum systems and a central fire alarm system which would improve the safety of the guests. These technological advancements cemented the St. Regis’ brand as a leader in innovation and hospitality.

Today, St. Regis (Owned by Marriott) is no longer innovating like it used to, while Airbnb constantly continues to innovate and introduce new services. Airbnb has the potential to completely out innovate the hotel industry and transform our cities through local experiences and autonomous vehicles.

Autonomous vehicles will bring us closer together as we will travel longer distances to experience new situations, customs, and cultures. No longer we will have to worry about how long a drive is or if we are too tired to drive or what do we do when we get there.

Instead, we can focus on the journey ahead of us and not behind us. Experiencing something new is intellectually stimulating and it can change our way of thinking. Experiencing a new city for the first time is joyful and something that magical. It’s these experiences that partially shape who we are and set in course the motion of who will become.

Autonomous vehicles will allow us as a society to experience more of these journeys. These journeys will transform our cities and perhaps we will once again experience a city as a village.

Automating A to Z: Will Airbnb Integrate Autonomous Vehicles is an article written by Brulte & Company Co-Founder Grayson Brulte that was originally published on LA CoMotion.

Airbnb Autonomous Vehicle Service

In this episode of The Road To Autonomy, Grayson Brulte discusses why Airbnb will launch an autonomous vehicle service in the future.

The $550 billion hotel industry is in flux and the big change has not even occurred yet. While traditional hoteliers fret over Airbnb and their $30 billion valuation, they are once again missing the big picture – autonomous vehicles.

While chain hotels were busy focusing on consistency, Airbnb was busy focusing on authenticity and learning about their customers. In the early days, Brian Chesky, Co-Founder and CEO moved out of the apartment he shared with his co-founders to live exclusively on Airbnb. The co-founder of Airbnb believed in his product so much, he would live on the platform.

This level of dedication to the product is still evident today. If you visit Airbnb’s office, you will notice that the two dozen or so conference rooms are exact replicas of Airbnb listings around the world. How many traditional hotel companies have modeled their conference rooms as exact replicas of rooms around the world? Zero.

In keeping with this attention to detail, Airbnb moved into the experiences market in late 2016. Now in mid-2017, the hotel industry is once again playing catch up to Airbnb and the entire home-sharing revolution. As the hotel industry introduces experiences, Airbnb is busy working remaking the entire travel industry. Tune in to learn why Airbnb will launch an autonomous vehicle service in the future.

Interested in learning more about why Airbnb will launch an Autonomous Vehicle Service? Peruse our Automating A to Z: Will Airbnb Integrate Autonomous Vehicles? article.

Watch every episode of The Road To Autonomy