Rethinking Transportation 2020-2030 · 2021. 1. 29. · APTA 2018 Transit CEO Seminar Miami, FL...
Transcript of Rethinking Transportation 2020-2030 · 2021. 1. 29. · APTA 2018 Transit CEO Seminar Miami, FL...
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Copyright © 2016 Tony Seba
Tony Sebawww.tonyseba.com
Feb 11, 2018
American Public Transportation AssociationAPTA 2018 Transit CEO Seminar
Miami, FL
Rethinking Transportation 2020-2030Disruption, Implications & Choices
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A STROLL DOWN
Memory Lane
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5th AVE NYC
1900Where is
thecar?
US National Archives : Fifth Ave NYC on Easter Morning 1900
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5th AVE NYC
1913
George Grantham Bain Collection
Where is the
horse?Photo: Easter 1913, New York. Fifth Avenue looking north.
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TECHNOLOGY
Disruption
Rodin – ThinkerPhoto: Tony Seba
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What is a Disruption?
WHEN A NEW PRODUCT OR SERVICE HELPScreate a new marketANDsignificantly weaken,transform, ordestroy an existing product, market category / industry
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FAST FORWARD TO 1985
1985Image: GMAuthority.com
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‘Expert’ Disruption ForecastsAT&T hired McKinsey & Co to forecast cell phone adoption by the year 2000
THEIR (15-YEAR) PREDICTION
900,000SUBSCRIBERS
THE ACTUAL Year 2000 NUMBER WAS
109 million120x
They were off by a factor of:
Motorola DynaTAC 8000X from 1984. Source: Wikimedia, Source: Economist
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AT&T Disrupted - while $$ Trillions Created
� AT&T’s landline telephony market was disrupted� It missed out on multi-trillion dollar opportunities!
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Actual
Forecast
Sources: Subscriber Data : CTIA Companies: Company Stock date source: Yahoo!
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“The iPhone's impact will be minimal. It will only appeal to a few gadget freaks. Nokia and Motorola have nothing to worry about.”
Bloomberg Analyst, 2007
“There's no chance that the iPhone is going to get any significant market share. No chance....”
Steve Ballmer,CEO Microsoft, 2007
It’s usually the ‘experts’, ‘insiders’ & mainstream analysts who dismiss Disruptive Opportunities
“It's important that [Internet] expectations aren’t cranked too high. The total number of users is still very small...”
Bill Gates, CEO Microsoft, 1994Image Source: Forbes
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FAST FORWARD TO 2000
2000Image Source: State.me.us
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Image: GMAuthority.com
� FY 2000 Financial Results:� Revenues: $14 B
� Operating Earnings: $2.2 B
� Net Profits: $1.4 B� "Picture-taking at an all-time high worldwide:"(1)
� Record # of Pictures taken: 80 billion.
� Record # of Prints ordered: 100 billion.
� 2012 - Kodak Filed for Bankruptcy Protection
Kodak FY 2000: Record Results
(1) Kodak, Annual Report 2000, Letter to Investors, Sources: Data and Image : Kodak
"A great brand, a great balance sheet, cash flow. This is a very smart time to
be in the picture business" Daniel Carp, CEO, Kodak
Letter to Investors, FY 2000
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Why do smart peopleat smart organizationsconsistently fai lto anticipate or leadMarket Disruptions?
Rodin – ThinkerPhoto: Tony Seba
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Technology Cost Curves
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Computing:Moore’s Law(1971 - 2011)
Loga
rithm
ic Sc
ale
1Billion x
� # of transistors doubles (roughly) every two years.
� Annual improvement rate ~41.4%
� Exponential growth in # of transistors
Source: Wikipedia
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Technology Cost CurvesTechnologies Improving at different rates
� Data Storage – Kryder’s Law� Hard Disk $/bit down 50% every 18 months
� Digital Imaging – Hendy’s Law� Pixels per $ - 59% / year
� Network Capacity – Butter’s Law of Photonics� The $ cost of transmitting a bit decreased by
50% every 9 months
� Li-iOn Batteries� $/kWh 20% per year
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TechnologyConvergence
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Convergence 2007 - Smartphone
apple.com
� Technology convergence in 2007 to make the smartphone possible
� Data Storage – Kryder’s Law� Hard Disk $ cost per bit down 50% every 18 months
� Digital Imaging – Hendy’s Law� Pixels per $ - 59% / year
� Network Capacity – Butter’s Law of Photonics� The $ cost of transmitting a bit decreases by 50%
every 9 months
� Touchscreen, Li-ion batteries, computing, sensors... Source: Wikipedia Image: apple.com
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KeyTechnologies
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1. Sensors / Internet of Things2. Artificial Intelligence / Machine Learning3. Robotics4. Solar PV5. Batteries 6. 3D Printing7. 3D Visualization8. Mobile Internet & Cloud9. Big Data / Open Data10. Unmanned Aerial Vehicles / Nano Satellites11. Blockchain
2017 - Key Technologies
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Exponential Market Adoption S-Curve
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ü Tech adoption is not linear but follows an exponential S-CurveGraph Source: Technology Futures, Inc.
Technology Adoption S-Curve (Color TV % US)
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Car market share (passenger miles) – 20 years to 95%! � Car market share (passenger miles): from 11% (tipping
point) to 81% in 10 years!
Srouce; RethinkX
0%
20%
40%
60%
80%
100%
1905 1910 1915 1920 1925 1930
Car
Horse
� Building two whole new industries (auto and oil) from scratch – from extraction to production to retail
� Building a new road infrastructure from scratch
� Training a whole generation of workers in brand new skills (complex operation of machines, maintenance…)
� Inventing new industrial processes (assembly line…)
� Inventing new business models (car loans…)
� Fighting World War I
Despite:
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Technology Adoption S-Curves Accelerating
� Tech adoption S-Curves are getting even more exponential! Accelerating!
Graph Source: Blackrock
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Technology Adoption S-Curves vs Linear Forecasts
© Tony Seba 2018
© Tony Seba© Tony Seba
� Tech adoption S-Curves: feedback loops, exponential growth, tipping points, network effects, business model innovation, tech cost curves…
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Image: GMAuthority.com
� Mainstream Forecasts:� Linear
� Backwards-looking
� Siloed
� They don’t take into account � Technology cost curves
� Product Innovation
� Business Model Innovation
� Reality: evidence of exponential nature of technology adoption
Mainstream Forecasts: Linear – despite evidence
Image Source: PV Magazine
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Business ModelInnovation
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Business Model Innovation:Ride-Hailing (Uber, Didi, Lyft, Ola, Gett...)
• Uber Bookings > US Taxi Industry Revenues (2016)
• San Francisco - Uber & Lyft are 20% of all VMTs (2017) (2)
• NYC - Ride-Hailing = 500,000 rides/day vs MTA Buses = 2.4m rides/day (2016) (1) (3)
(1) Rethinking Transportation, (2) Northeastern Univ (3) MTA NYC Transit
Photo: Tony Seba
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From Ownership to Access:CAR OWNERSHIP DEFECTION has started!
Oct 15, 2017
Source: MotorTrend.com
"The shift toward a new driving economy might already be taking hold: An Ipsos/Reuters survey showed that, of the
people who traded in their cars, about 10 percent weren’t replacing
them. They were switching to car-sharing and
ride-hailing.
The survey also showed that 39 percent of Americans had used ride services and that 27 percent of that group did
so at least several times per week. That’s a groundswellPhoto: Tony Seba
THE HIDDEN BENEFITS OF CARSHARING
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Business Model Innovation: AirBnbMarketplace Broker
Source: Tesla
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Business Model Innovation
is as important & disruptive as
Technology Innovation
Business Model Disruption
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BatteriesElectric VehiclesAutonomous VehiclesRide-Hailing
1
2
3
4
CLEAN DISRUPTION OF ENERGY & TRANSPORTATION
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Batteries / Energy Storage
GreenCharge Networks
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Li-ion Battery costs dropping exponentially
� Laptop Li-ion battery costs dropped ~14% per year over 15 years. (1)
� Investments in battery tech increasing dramatically:
� 3 multi-trillion $ industries investing:1. IT/ Electronics2. Automotive3. Energy
� 2010-2014, battery costs dropped at ~16%/year ⟶ACCELERATION
Photo: telegraph.uk(1) Clean Disruption
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Projected cost of Li-ion Battery $/kWh (CD: 2014)
Clean Disruption (2014) Assumption: 16% /year Technology Cost Curve Source: Clean Disruption
$-
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
$100/kWh
$200/kWh
$300/kWh
Cos
t of L
i-ion
Bat
tery
Sto
rage
($/k
Wh)
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Tech Cost Curve has acceleratedto ~20% (2010-2016)
Investments in Battery Megafactories increasing
Image Source: Samsung SDI
Sources: (1) Reuters, (2) (3) Benchmark Minerals (4) Electrek
� 20 Li-iOn Megafactories in the pipeline to come online by 2021 totaling 325 GWh (1)
� In 2014 there were just 3 (in the 2021 pipeline) totaling 50 GWh.(2)
� Samsung SDI, Dyson, LG Chem, Total, Bosch, Boston Power, BYD, TDK, Apple, Nissan, Daimler, VW, etc.
� Tesla may Triple expected output to 105 GWh (cells) / 150 GWh (packs) (4)
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5 Million U.S. Businesses Can Cut Power Bills with Batteries
Companies with Demand Charges > $15/kW can benefit…including more than one million customers in Georgia, Colorado, Michigan,
Texas, Florida and New England.
Aug 24, 2017
Photo Source: Stem
National Renewable Energy Lab (NREL) study of 10,000 utility rate plans: more than a quarter of
U.S. businesses could cut power bills if they installed batteries to reduce peak energy
demand. (1)
Image Sources: The Verge
Sources: (1) Bloomberg (2) NREL
Battery Disruption – Commercial Scale
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DYSON to Develop Electric CarVacuum maker Dyson to invest £2.5
billion to develop an electric car to go on sale 2020.
Sept 26, 2017
Source: (1) The Guardian
Last year the Dyson announced £1 bninvestment in battery technology after
acquiring solid-state battery maker Sakti3 for $90m, which "developed a
battery breakthrough”(1)Image Sources: The Verge
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The Electric Vehicle Disruption
Photo: © Tesla Motors
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IS THE ELECTRIC VEHICLEDisruptive?(You always need to ask)
Rodin – ThinkerPhoto: Tony Seba
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1. Electric Motor - 5X more Energy Efficient
Sources:ICE - DOE, EM Wikipedia, Image Sources: ICE - Tony Seba, Electric - BradMerritt.com
InternalCombustionEngine
Electric Motor
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2. EVs are 10X cheaper to charge/fuel
� It costs $15,000 to fill up a (gas) Jeep Liberty over five years (Consumer Reports)
� An Electric Jeep Liberty would cost $1,565in electricity
� Improvements in software and power electronics to increase this >10X
Assumptions:12,000 miles/yearTesla Roadster: 4.6 miles per kWh. Avg retail electricity in the U.S.: 12 ¢/kWh5 year-cost = (60,000 miles * 0.12 $/kWh) / 4.6 miles/kWh = $1,565.
Image Source: jeep.com
Sources: Consumer Reports, DOE, Clean Disruption
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3. EVs: 10X cheaper to MaintainICE (Gas) Vehicle
2,000+ moving parts (1)
Electric Vehicle (EV)
18 moving parts (1)
� EVs 100X fewer parts
� Tesla: Infinite Mile Warranty! (2)
Source: (1) Baron Funds, (2) Tesla Blog
Transmission, driveshaft, clutch,
valves, differentials, pistons, gears,
carburetors, crankshafts...
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Copyright © 2016 Tony Seba
4 – EVs Lifetime 2.5x > than ICE
• EV powertrains last 500,000 miles (800,000 Km)• Tesla (& others) building 1,000,000-mile (1.6m Km) Powertrain• That's 5x-7x ICE vehicles (1)
(1) Rethinking Transportation
Photo: Tony Seba
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Copyright © 2016 Tony Seba
5 – EVs MORE powerful than ICE
“University Student team builds EV that breaks world acceleration record (0-100 Km/h in 1.51 sec) beats the
$1m Porsche 918 Spyder (2.2 sec)” (1) (1) ETHZ news
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Copyright © 2016 Tony Seba
6- EVs Can Provide Services to Grid
Image Sources: Tony Seba
� An EV can power avg American home for ~2 days� With Vehicle-to-Grid (V2G) tech EVs can
provide the grid with ancillary services that can generate $revenue$ for the EV owner.
� EVs > than cars - EVs = Batteries / Power Plants on Wheels – can be used as dynamic, modular, scalable & reliable grid resource.
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Copyright © 2016 Tony Seba
$-
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
Cost
of E
lect
ric V
ehic
le
Anticipating Disruption from Above – Electric VehiclesCost of EV with 200-mile (320 Km) range
ICE “AffordableSUV": $35-$40K
Avg ICE Carin US: $33K
Avg Low-endICE car US: $22K
2014 Assumptions: • 4 miles/kWh,• 50kWh batteries,• 16% yearly battery cost
improvement,• EV Cost = 3X battery
Source: Clean Disruption
Clean Disruption © Tony Seba
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Copyright © 2016 Tony Seba
Tesla Model 3 – Record Single-Day Sales for any Product of Any Kind Ever!
Market reaction:
180,000 cars>$6.3b
ordered / reserved first 24h!
pipeline first 24h!
Tesla Model 3
$ 35,000+Autopilot (semi-autonomous)
215-mile range
0-60
Unsubsidized
0-60mph in < 6 secs
Sources: Tesla,
Image: Tesla
Biggest Crowdfunding Event in History: $500m & counting!
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Copyright © 2016 Tony Seba
The AutonomousVehicle Disruption
Photo : Waymo
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Copyright © 2016 Tony Seba
Alphabet Launches Taxi Service With No Human DriversNovember 7th, 2017
Source: Waymo
Photo : The Verge
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Copyright © 2016 Tony Seba
44 Corporations Working on Autonomous VehiclesCB Insights May 18th, 2017
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Copyright © 2016 Tony Seba
Elon Musk: "From Parking Lot in California to Parking
Lot in New York without touching controls by Dec
2017." (2) April 2017
TESLA TO TRANSITION TO LEVEL 5 -FULLY SELF-DRIVING - 2019
"U.S. National Highway Traffic Safety
Administration (NHTSA): Tesla with Autopilot
40% Safer." (1) Jan 2017
April 25, 2017
Image: Tesla
Sources: (1) Fortune, (2) Electrek
"Level 5 Autonomy in two years [2019]. " (2)
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Copyright © 2016 Tony Seba
Autonomous Vehicles = Computer on Wheels
ALL YOU NEED is ONE Platform to Achieve LEVEL 4-5
Image: © Copyright Tony Seba
� Computer Platforms = network effects
� Winners Take All: only two O/S Survive (PC, Smartphone, Tablets...)
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Copyright © 2016 Tony Seba
WHAT ABOUT THECOST of
Autonomous Vehicles?
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Copyright © 2016 Tony Seba
What an autonomous car seesCopyright © 2016 Tony Seba Graphic Popular Science
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Copyright © 2016 Tony Seba
Technology Cost Curves
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Copyright © 2016 Tony Seba
Exponential Technologies:Machine Vision (LIDAR Sensors)
$10k
$1k
2012LIDAR Sensor (for Machine Vision) was
Google announced that the cost oftechnology in its self-driving car was
2013 The next generation LIDAR wasBy the end of
2014 A SV Startup company announced LIDAR forBy Oct
$70k~$150k
Image: Wikipedia
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Copyright © 2016 Tony Seba
LIDAR: From $70,000 to $250
2015 GEN 1 LIDAR
2017 GEN 2 SOLID STATE LIDAR
GEN 3 (POSTAGE STAMP)
$250$1,000
$90Sources: Quanergy,Clean Disruption
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Copyright © 2016 Tony Seba
� Where are the 5 LIDAR Sensors?
Autonomous Electric Vehicle (A-EV)
Photo: Tony Seba
fortune.com
Car: Fisker eMotion 2020
Photo: Tony Seba
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Copyright © 2016 Tony Seba
Autonomous Vehicles = Computer on Wheels
WHAT IS THE
Cost Curveof Computing PowerTO PROCESS SENSOR INPUT?
Image: © Copyright Tony Seba
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Copyright © 2016 Tony Seba
Year 2000: World’s 1st 1-TeraFlops Computer
� Space = 1,600 sq ft (150 m2)� Power Consumption = 850 kW
� Cost = $46 million
ASCI RED - Sandia National Labs
Image: Extreme Tech
Source: Wikipedia
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Copyright © 2016 Tony Seba
Exponential Tech Improvement: GPU NVIDIA Drive™ PX
ü Drive PX™ Pegasus (mid-2018): 320 TOPS
ü 25 companies developing level 5 AVs (1)
� Built-in Deep Learning Software
Dual Drive PX 2 GPU Platform
8 TFlops• Power Consumption = 250 W
3,400x improvement
Cost = ~$600~653,000x improvement
Image and Data Sources: NVIDIA
NVIDIA CEO Jen-Hsung Huang
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Copyright © 2016 Tony Seba
� Not just substitution of existing modes of transportation. � Self-Driving delivery units, tractors, buses, trucks,
wheelchairs...� Impact on logistics, retail, food, mail, health care...
Product Innovation – Autonomous Anything on Wheels!
fortune .com
fortune.com
Photo: Tony Seba
Self-driving Scooter at SMART MIT
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Copyright © 2016 Tony Seba
Disrupt ion Accelerators
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Copyright © 2016 Tony Seba
Disruption Accelerators: Computer Simulation
Source: (1) Medium (2) The Atlantic
Image Source: Atlantic, Waymo
� Waymo has 25,000 self-driving cars driving 8 million miles/day (2.5 billion miles/year) within its Carcraftsimulation software. (1)
� Carcraft can simulate hundreds/thousands of variations of situations that might even be impossible to encounter in the ‘real world’.
� Waymo’s (fka Google) physical cars have driven 3.5 million miles on public roads in 8 years. (2)
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Copyright © 2016 Tony Seba
High Definition 3D Mapping & Localization –> L4/L5
ALL YOU NEED is ONE Platform to Achieve LEVEL 4-5
Image:Source © Copyright DeepMap
� Computer Platforms = network effects
� Winners Take All: only two O/S Survive (PC, Smartphone, Tablets...)
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Copyright © 2016 Tony Seba jenningswire.com
Cool! I can
and also
while NOT driving!
BUT WHERE’S THE
Big Bang Disruption?Rodin – Thinker
Photo: Tony Seba
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Copyright © 2016 Tony Seba abc7news.com
The Disruption of Transportation
2020-2030
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Copyright © 2016 Tony Seba
Cars: Huge Waste of Space and Money
� Cars = 2nd largest Capital Expense� Avg. new car costs = $33k
� Cars are parked 96% of the time! (1)
� 4% Asset Utilizationis a disruption waiting to happen!
Photo: Tony Seba
Source: (1) Donald ShoupImage: Tony Seba
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Copyright © 2016 Tony Seba Photo Tony Seba
Transportation As A Service(TaaS)
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Copyright © 2016 Tony Seba Source: (1) Clean Disruption
On Demand + AUTONOMOUS + ELECTRIC VEHICLE TECH:
Convergence of Technology & Business Model Innovation
Source: Rethinking Transportation
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Copyright © 2016 Tony Seba
TaaS - Transportation-as-a-Service: On Demand, Autonomous, Electric (AEV)
� Transport As A Service (TaaS)� Ride-Hailing (on demand) biz model� Electric Vehicle tech� Autonomous Vehicle tech
Source: (1) Clean Disruption
� Driving time goes from 4% to 40%� Vehicle Asset Utilization goes UP 10X� Cars can drive 100,000
miles/year (up from 10k miles/yr)
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Copyright © 2016 Tony Seba
Why Electric Vehicles? FLEET Choice: A-EV far cheaper than A-ICE
� Autonomous Internal Combustion Engine (A-ICE)Vehicles can't compete with Autonomous Electric Vehicles (A-EV).
� TaaS companies that use A-ICE will have to� Switch to A-EVs, or� Go bankrupt
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Copyright © 2016 Tony Seba
Transportation As A Service(TaaS)
On Demand
Autonomous Electric Vehicles
(AEVs)
Owned by FLEETS
not individuals
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Copyright © 2016 Tony Seba
TaaS: 4x-10x Cheaper than IO Vehicles
Source: (1) Clean DisruptionSource: Rethinking Transportation
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Copyright © 2016 Tony Seba
95% of Passenger Miles TaaS (AEV) by 2030
Source: Rethinking Transportation
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Copyright © 2016 Tony Seba abc7news.com
Implications:End of ICEV & IO
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Copyright © 2016 Tony Seba
U.S Vehicle Fleet Shrinks by 80%
Source: (1) Clean DisruptionSource: Rethinking Transportation
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Copyright © 2016 Tony Seba
Annual Demand for New Vehicles Shrinks by 70%
Source: (1) Clean DisruptionSource: Rethinking Transportation
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Copyright © 2016 Tony Seba abc7news.com
Implications:Disruption of Oil Industry
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Copyright © 2016 Tony Seba
Global Oil Demand Peaks at 100mpd 2020Drops to 70mpd 2030
Source: (1) Clean DisruptionSource: Rethinking Transportation
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Copyright © 2016 Tony Seba
Global Equilibrium Cash Cost ~ US$ 25.4/bblwith 70mbpd demand
Source: (1) Clean DisruptionSource: RETHINKX
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Copyright © 2016 Tony Seba
Up to 70% of Deepwater Oil, Shale Oil, Oil SandsUncommercial = Stranded Assets
Source: (1) Clean DisruptionSource: Rethinking Transportation
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Copyright © 2016 Tony Seba abc7news.com
Implications:Financial, Social,
Environmental, Geopolitical
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Copyright © 2016 Tony Seba
TaaS Disruption ImplicationsFinancial & Social
Source: RethinkX
� Social: Increased mobility for all � Elderly / Pensioners� Disabled� Young� Poor, Unemployed, Underemployed
Source: RethinkX
� Financial� Saving per Household: $5,600+ / yr� U.S. Disposable Income increase by $1
Trillion / year� Productivity increase of $1 Trillion / yr -
time freed from driving
Image: Tony Seba
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Copyright © 2016 Tony Seba Source: (1) Clean Disruption
� Geopolitical� Oil Energy Independence� Foreign Policy: energy security less critical
Image: Tony Seba
� Environmental� 80% decrease energy consumption� 90% decrease in CO2 emissions � Decreased use of materials (20 vs 2000 &
200k vs 500k)
Source: RethinkX
Image: Tony Seba
TaaS Disruption ImplicationsEnvironmental & Geopolitical
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Copyright © 2016 Tony Seba
TaaS Disruption - Parking Obsolete: 80%+ Vacant
Source: (1) Clean DisruptionImage: Tony Seba
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Copyright © 2016 Tony Seba
TaaS Disruption Implications - Auto Industry� Parking -> Real Estate� Roads / Infrastructure� Auto Value Chain: from B2C to
B2B2C� Car Insurance� Car Financing � Repair & Maintenance Shops� Dealerships� Materials - Mining� Shipping
Image: Tony Seba
Image: Tony Seba
Source: Rethinking Transportation
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Copyright © 2016 Tony Seba abc7news.com
Back to the Future
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Copyright © 2016 Tony Seba
2030We are here
On the Cusp of the Fastest, Deepest, Most Consequential Disruption of Energy & Transportation in History
2018
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Copyright © 2016 Tony Seba
This is NOT an Energy TransitionThis is a Technology Disruption
Photo: Tony SebaCopyright 2016 Tony Seba
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Copyright © 2016 Tony Seba
Thank You!
Photo: NASA
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Copyright © 2016 Tony Seba
Tony Sebawww.tonyseba.com
Feb 11, 2018
American Public Transportation AssociationAPTA 2018 Transit CEO Seminar
Miami, FL
Rethinking Transportation 2020-2030Disruption, Implications & Choices