Below is a presentation by Frank Chen – head of research, deal, and investing at the venture firm Andreessen Horowitz – which makes the case for self-driving electric car fleets.
He starts the presentation by talking about why he thinks this shift is going to happen faster than most people think.
One reason for this is that the batteries are becoming dramatically cheaper and the battery makes up a large part of the cost. By 2025, it is expected that electric vehicles will become cost neutral with ICE (internal combustion engine) vehicles assuming zero government subsidies.
And by 2038, Bloomberg believes we will hit peak ICE vehicle sales. That is, electric vehicle and ICE vehicle sales globally will hit 50/50. Norway has already hit this threshold but they impose heavy financial penalties on ICE vehicles.
2025 is not that far away.
If you can’t see the presentation below, click here.
[youtube https://www.youtube.com/watch?v=of5j-Lztqrg?rel=0&w=560&h=315]
This morning Fred Wilson linked to a Bloomberg article on his blog called, Maybe This Global Slowdown Is Different. There are a bunch of great charts throughout the piece and I’d like to share 3 of them here.
The first chart shows how per capita energy consumption has dropped remarkably in the United States since the 1990s, but how, not surprisingly, China’s rate is increasing.
The second chart shows car sales in the US. There was a big drop off during The Great Recession, and though sales have rebounded, they still haven’t reached their late 1990s peak. But that’s not to say that they won’t.
And the third chart shows the tremendous shift in the US over the last 65 years from the consumption of stuff to services.
This last one is fascinating. And it ties into the argument that the way value is created in our economy has shifted dramatically.
But I wonder if this change is really as sharp as it seems.
If you look at what makes up “services”, you’ll see that housing (and utilities) and healthcare make up over 50% of what is considered to be personal spending on services. And if you look at housing and utilities spending since the 1960s in the US, it has increased dramatically.
So how much of this shift from stuff-to-services is actually being driven by housing?