Regulations Hampering AV Innovation

GM Cruise’s decision to postpone deployment of its autonomous, on-demand ride-sharing fleet signals a larger concern automakers should consider when pushing AV innovation, Grayson Brulte, president of Brulte & Co., told Auto Finance News.

Regulations are one of the biggest hurdles for automakers invested in AV, Brulte said. “The rockstars and the biggest assets to AV companies are the policy staff,” he said. “The policy team — not the engineers — needs to make the decision on where to deploy the services,” he said, adding that each state has different laws related to autonomous vehicles.

California, where GM Cruise is based, is by far the most restrictive when it comes to regulations on autonomous vehicles, which hampers innovation, Brulte said. In fact, California prohibits for-profit autonomous vehicle services.

GM Cruise Chief Executive Dan Ammann announced on Medium that the San Francisco-based company intends to expand its footprint in the city to increase testing and validation miles driven. A company spokesman confirmed that the company still plans to unveil a car-sharing service in San Francisco, although he declined to disclose a timeline or additional details. The company currently offers an autonomous ride-sharing service for its employees.

General Motors, the parent company for GM Cruise, had previously said that it hoped to deploy 2,500 modified Chevy Bolts as part of a controlled, on-demand ride-sharing fleet at the end of 2019, according to Reuters. Honda has also invested $750 million in the AV manufacturer.

As featured in Auto Finance News on July 30, 2019.

5 Things to Know About the Au­tonomous Car Debate in Tal­la­hassee

Monday, Grayson Brulte, a top autonomous technology consultant, addressed the Economic Club of Florida on the politics and policy surrounding self-driving cars.

“Florida has one thing that a lot of states don’t have,” he reported. “You have leadership.” But while state leaders have has been markedly receptive to the rise of autonomous vehicle technology, recent events are giving some lawmakers cause for concern.

Watch highlights from Grayson Brulte’s discussion with Chris Emmanuel at the Economic Club of Florida on Bay News 9.

The Economic Club of Florida

A Conversation about Self-Driving Cars and the Future Economic Impact of Autonomy.

On July 29, 2019 the Economic Club of Florida hosted “A Conversation About Self-Driving Cars and the Future Economic Impact of Autonomy.” The featured presenter was Grayson Brulte, co-founder and president of Brulte & Company, which has significant involvement in autonomous vehicle technologies.

Listen to the full conversation on WFSU Radio.

As featured WFSU Radio on July 29, 2019.

How Lenders Stand to Benefit From Uber’s Platform

Despite profitability concerns outlined in Uber Technologies’ S-1 filing, lenders could benefit from partnering with the mobility company, Grayson Brulte, president of Brulte & Company, told Auto Finance News. For instance, lenders might allow Uber drivers to rent their off-lease inventory.

“Uber is not a ride-sharing company or an autonomous vehicle company or a food delivery company,” Brulte said. “Uber is a platform. And if you’re investing in Uber, you’re betting on the platform.”

Lenders can benefit from Uber’s growing platform by leveraging the assets on their balance sheet to create returns outside of remarketing at auction. “The strength of an auto lender is the balance sheet, not its platform,” Brulte said.

“The best way to create that return is to strike deals with platforms where you can put your vehicles that are off-lease to use so those vehicles are generating revenue.”

Uber filed its initial public offering prospectus with the Securities Exchange Commission last week, less than a month after the stock of rival Lyft began trading on the N.Y. Stock Exchange. Uber’s IPO is expected to assign a $100 billion valuation to the mobility platform. Comparatively, Lyft was valued at $24 billion in its March 29 IPO. Lyft shares have been trading around $56 each, down 22% from their opening day price.

As featured in Auto Finance News on April 25, 2019.

Amazon Investment in Electric OEM Paves Way for ‘Limitless’ Mobility Potential, Analyst Says

Amazon’s $700 million investment in electric OEM Rivian is a potential step by the retail giant to launch a mobility service that would supplement its delivery platform, said Grayson Brulte, a consultant with Brulte & Co.

“I think it’s limitless where Amazon takes it,” Brulte told Auto Finance News. “There’s a lot of money to be made in niches. Do they bundle a mobility service with [Amazon] Prime? So now they’re moving individuals and goods at the same time, and the cost of delivery rapidly plummets. And the rides for the individual go down, as well, because it’s subsidizing the ride.”

It remains unclear as to how Rivian — which declined to comment — plans to finance its new fleet of vehicles to would-be consumers. Brulte noted that Amazon’s vast reach in the global market puts the company in a good position to fill that need. “Amazon can borrow money very cheaply. [The company] has an incredible ability to underwrite, if they so choose, or to partner with a bank — a Goldman Sachs or Bank of America — to underwrite at a very low percentage,” he said.

Besides, Amazon is already making loans to small businesses. “It’s not out of their wheelhouse,” Brulte said. “If you look at Amazon’s small business program, some of those loans are $35,000, $40,000, $50,000. That’s a comparable rate to a vehicle, similar metrics.”

A question mark in the equation is whether Amazon would launch a mobility service or an autonomous mobility service, given that it invested in self-driving technology platform Aurora earlier this month. “You’re looking at a $250,000 to $400,000 underwriting,” he said. “Amazon has the balance sheet and the cash flow, which provides the company with the ability to borrow [money] to underwrite that.”

As featured in Auto Finance News on March 6, 2019.