From Parking to Parks Bellevue & the Disruption of Transportation

Size: px

Start display at page:

Download "From Parking to Parks Bellevue & the Disruption of Transportation"

Lionel Ryan
5 years ago
Views:

1 From Parking to Parks Bellevue & the Disruption of Transportation Bellevue Chamber of Commerce 2017 Eastside Annual Dinner Presentation to: 10 Oct 2017 Bellevue, WA Tony Seba

2 A STROLL DOWN Memory Lane

3 5 th AVE NYC 1900 Where is the car? US National Archives : Fifth Ave NYC on Easter Morning 1900

4 5 th AVE NYC 1913 Where is the horse? George Grantham Bain Collection Photo: Easter 1913, New York. Fifth Avenue looking north.

5 TECHNOLOGY Disruption Rodin Thinker Photo: Tony Seba

6 What is a Disruption? WHEN A NEW PRODUCT OR SERVICE HELPS create a new market AND significantly weaken, transform, or destroy an existing product, market category / industry

7 FAST FORWARD TO Image: GMAuthority.com

8 Expert Disruption Forecasts AT&T hired McKinsey & Co to forecast cell phone adoption by the year 2000 THEIR (15-YEAR) PREDICTION 900,000 They were off by a factor of: SUBSCRIBERS 120x THE ACTUAL Year 2000 NUMBER WAS 109 million Motorola DynaTAC 8000X from Source: Wikimedia, Source: Economist

AT&T Disrupted - while $$ Trillions Created 120,000,000 Actual 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 Forecast 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996

9 AT&T Disrupted - while $$ Trillions Created 120,000,000 Actual 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 Forecast AT&T s landline telephony market was disrupted It missed out on multi-trillion dollar opportunities! Sources: Subscriber Data : CTIA Companies: Company Stock date source: Yahoo!

10 It s usually the experts, insiders & mainstream analysts who dismiss Disruptive Opportunities There's no chance that the iphone is going to get any significant market share. No chance... Steve Ballmer,CEO Microsoft, 2007 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 It's important that [Internet] expectations aren t cranked too high. The total number of users is still very small... Bill Gates, CEO Microsoft,1994

11 FAST FORWARD TO Image Source: State.me.us

12 Kodak FY 2000: Record Results FY 2000 Financial Results: Revenues: $14 B Operating Earnings: $2.2 B "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 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 Kodak Filed for Bankruptcy Protection Image: GMAuthority.com (1) Kodak, Annual Report 2000, Letter to Investors, Sources: Data and Image : Kodak

13 Why do smart people at smart organizations consistently fail to anticipate or lead Market Disruptions? Rodin Thinker Photo: Tony Seba

15 Technology Cost Curves

16 Computing: Moore s Law ( ) 1Billion x # of transistors doubles (roughly) every two years. Annual improvement rate ~41.4% Logarithmic Scale Exponential growth in # of transistors Source: Wikipedia

17 Technology Cost Curves Technologies 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 14% per year Source: Wikipedia Image: apple.com apple.com

18 Projected cost of Li-ion Battery $/kwh Cost of Li-ion Battery Storage ($/kwh) $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $- Assumption: 16% /year Technology Cost Curve Source: Clean Disruption

19 Technology Convergence

Convergence 2007 - Smartphone 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

20 Convergence Smartphone 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 apple.com

21 Key Technologies

22 Key Technologies 1. Sensors / Internet of Things 2. Artificial Intelligence / Machine Learning 3. Robotics 4. Solar PV 5. Batteries 6. 3D Printing 7. 3D Visualization 8. Mobile Internet & Cloud 9. Big Data / Open Data 10. Unmanned Aerial Vehicles / Nano Satellites 11. Blockchain

23 Business Model Innovation

24 Business Model Innovation: Ride-Hailing (Uber, Didi, Lyft, Ola...) Uber Bookings > US Taxi Industry Revenues (2016) San Francisco = Uber & Lyft are 20% of all VMTs (2) New York City = 500,000 Ride-Hailing Rides per day (1) (1) Rethinking Transportation, (2) Northeastern Univ

25 Business Model Innovation: AirBnb Marketplace Broker Source: Tesla

26 Business Model Innovation Disruption Business Model Innovation is as important & disruptive as Technology Innovation

27 Exponential Market Adoption S-Curve

28 Technology Adoption S-Curve (Color TV % US) ü Tech adoption is not linear but follows an exponential S-Curve Graph Source: Technology Futures, Inc.

29 Technology Adoption S-Curves Accelerating Tech adoption S-Curves is are happening faster! Graph Source: Blackrock

31 How can WE Anticipate Market Disruptions? Rodin Thinker Photo: Tony Seba

32 The Disruption of Transportation abc7news.com

33 The Electric Vehicle Disruption Photo: Tesla Motors

34 2013 CAR OF THE YEAR: TESLA MODEL S Best-selling high-end large luxury car in America! (2) Consumer Reports: Best Car EVER! (1) Source: Motor Trends, (1) Consumer Reports, (3_Bloomberg & Tesla

35 But who can afford an Electric Vehicle? Photo: Tony Seba

36 IS THE ELECTRIC VEHICLE Disruptive? (You always need to ask) Rodin Thinker Photo: Tony Seba

37 1. Electric Motor - 5X more Energy Efficient Internal Combustion Engine Electric Motor Sources:ICE - DOE, EM Wikipedia, Image Sources: ICE - Tony Seba, Electric - BradMerritt.com

Assumptions: 12,000 miles/year Tesla Roadster: 4.6 miles per kwh. Ave retail electricity in the U.S.

38 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 $1,565 in electricity Improvements in power electronics will increase this 10X Assumptions: 12,000 miles/year Tesla Roadster: 4.6 miles per kwh. Ave retail electricity in the U.S.: 12 /kwh Image Source: jeep.com 5 year-cost = (60,000 miles * 0.12 $/kwh) / 4.6 miles/kwh = $1,565. Sources: Consumer Reports, DOE, Clean Disruption

39 2. Maintenance - Gasoline Car: 2,000+ moving parts (1)

valves, differentials, pistons, gears, carburetors, crankshafts.

40 3. EVs: 10X cheaper to Maintain ICE (Gas) Vehicle Electric Vehicle (EV) 2,000+ moving parts (1) 18 moving parts (1) Transmission, driveshaft, clutch, valves, differentials, pistons, gears, carburetors, crankshafts... EVs 100X fewer parts Tesla: Infinite Mile Warranty! (2) Source: (1) Baron Funds, (2) Tesla Blog

41 4 EVs Lifetime 2.5x > than ICE EV powertrains last 500,000 miles (800,000 Km) Photo: Tony Seba Tesla (& others) building 1,000,000-mile (1.6m Km) Powertrain That's 5x-7x ICE vehicles (1) (1) Rethinking Transportation

42 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

43 Anticipating Disruption from Above Electric Vehicles Cost of EV with 200-mile (320 Km) range $80,000 Cost of Electric Vehicle $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $- ICE Affordable SUV": $35-$40K Avg ICE Car in US: $33K Avg Low-end ICE car US: $22K Clean Disruption Tony Seba Assumptions: 4 miles/kwh, 50kWh batteries, 16% yearly battery cost improvement, EV Cost = 3X battery Source: Clean Disruption

44 Tesla Model 3 Record Single-Day Sales for any Tesla Model 3 Product of Any Kind Ever! $ 35,000 Unsubsidized Autopilot (semi-autonomous) 215-mile range 0-60mph in < 6 secs 0-60 Market reaction: Image: Tesla 180,000 cars >$6.3b ordered / reserved first 24h! pipeline first 24h! Biggest Crowdfunding Event in History: $400m & counting! Sources: Tesla,

45 The Autonomous Vehicle Disruption Image: Wikipedia abc7news.com

46 FINANCIAL TIMES May 5 th, 2015 NEVADA APPROVES AUTONOMOUS TRUCKS

MIT spinoff NuTonomy will be offering rides in 2.5 sqmi business district 1- North.

47 August 25 th, 2016 World's First Self-Driving Taxi Debuts In Singapore The first ever self-driving taxis have started picking up passengers in Singapore. MIT spinoff NuTonomy will be offering rides in 2.5 sqmi business district 1- North. Delphi also announced autonomous trial in Singapore. Photo : The Verge Image Sources: Renault Source: The Verge

48 CB Insights May 18 th, Corporations Working on Autonomous Vehicles

April 25, 2017 TESLA TO TRANSITION TO LEVEL 5 - FULLY SELF-DRIVING

" (1) Jan 2017 Elon Musk: "From Parking Lot in California to

49 April 25, 2017 TESLA TO TRANSITION TO LEVEL 5 - FULLY SELF-DRIVING "U.S. National Highway Traffic Safety Administration (NHTSA): Tesla with Autopilot 40% Safer." (1) Jan 2017 Elon Musk: "From Parking Lot in California to Parking Lot in New York without touching controls by Dec 2017." (2) April 2017 Image: Tesla "Level 5 Autonomy in two years [2019]. " (2) Sources: (1) Fortune, (2) Electrek

50 WHAT ABOUT THE COST of Autonomous Vehicles?

51 Technology Cost Curves

52 What an autonomous car sees Graphic Popular Science

53 Exponential Technologies: Machine Vision (LIDAR Sensors) 2012 By the end of 2013 Google announced that the cost of technology in its self-driving car was LIDAR Sensor (for Machine Vision) was The next generation LIDAR was ~$150k $70k $10k By Oct 2014 A SV Startup company announced LIDAR for $1k Image: Wikipedia

LIDAR: From $70,000 to $250 2015 GEN 1 LIDAR $1,000 2016 GEN 2 SOLID

54 LIDAR: From $70,000 to $ GEN 1 LIDAR $1, GEN 2 SOLID STATE LIDAR $250 GEN 3 (POSTAGE STAMP) $90 Sources: Quanergy,Clean Disruption

55 Year 2000: World s 1 st 1-TeraFlops Computer ASCI RED - Sandia National Labs Space = 1,600 sq ft (150 m2) Power Consumption = 850 kw Cost = $46 million Image: Extreme Tech Source: Wikipedia

improvement ü Xavier (Q4 2017): 20 TFlops ü Built for Self-Driving Cars Deep

56 Exponential Tech Improvement: GPU NVIDIA Drive PX Dual Drive PX 2 GPU Platform 8 TFlops Power Consumption = 250 W 3,400x improvement Cost = ~$600 ~653,000x improvement ü Xavier (Q4 2017): 20 TFlops ü Built for Self-Driving Cars Deep Learning Software ü 1,000x improvement by 2025 NVIDIA CEO Jen-Hsung Huang Image and Data Sources: NVIDIA

57 Autonomous Vehicles = Computer on Wheels Computer Platforms = network effects Winners Take All: only two O/S Survive (PC, Smartphone, Tablets...) ALL YOU NEED is ONE Platform to Achieve LEVEL 4-5 Image: Copyright Tony Seba

58 High Definition 3D Mapping & Localization > L4/L5 Computer Platforms = network effects Winners Take All: only two O/S Survive (PC, Smartphone, Tablets...) ALL YOU NEED is ONE Platform to Achieve LEVEL 4-5 Image:Source Copyright DeepMap

59 Are consumers ready for autonomous cars? 2.8 b people Source: Cisco Systems

60 China 70% Brazil 95% India 86% Images Source: chinawshisper.com, inrix.com, ryot.org

61 Cool! I can and also while NOT driving! BUT WHAT S THE Disruptive Impact? Rodin Thinker jenningswire.com Photo: Tony Seba

62 Transportation As A Service Photo Tony Seba

63 Cars: Huge Waste of Space and Money Cars = 2 nd largest Capital Expense Ave. new car costs = $33k Cars are parked 96% of the time! (1) 4% Asset Utilization is a disruption waiting to happen! Photo: Tony Seba Image: Tony Source: Seba (1) Donald Shoup

64 On Demand + SELF-DRIVING + ELECTRIC: Convergence of Technology & Business Model Innovation Source: (1) Clean Disruption Source: RETHINKX

65 TaaS - Transport-as-a-Service: On Demand, Electric, Autonomous Transport As A Service (TaaS) Ride-Hailing biz model Electric Vehicle tech Autonomous Vehicle tech 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) Source: (1) Clean Disruption

66 Do the Math: A-EV far cheaper than A-ICE Autonomous Internal Combustion Engine Vehicles can't compete with Autonomous Electric Vehicles. TaaS companies that use A-ICE will either go bankrupt or switch to A- EVs Source: (1) Clean Disruption Source: RETHINKX

67 Transportation As A Service (TaaS) On Demand Autonomous Electric Vehicles (AEVs) Owned by FLEETS not individuals

68 TaaS: 4x-10x Cheaper than IO Vehicles Source: (1) Clean Disruption Source: RETHINKX

69 95% of Passenger Miles TaaS (AEV) by 2030 Source: (1) Clean Disruption Source: RETHINKX

70 Disruption of Auto Industry: End of ICE & IO abc7news.com

71 U.S Vehicle Fleet Shrinks by 80% Source: (1) Clean Disruption Source: RETHINKX

72 Annual Demand for New Vehicles Shrinks by 70% Source: (1) Clean Disruption Source: RETHINKX

73 Disruption of Oil Industry abc7news.com

74 Global Oil Demand Peaks at 100mpd 2020 Drops to 70mpd 2030 Source: (1) Clean Disruption Source: RETHINKX

75 Global Equilibrium Cash Cost ~ US$ 25.4/bbl with 70mbpd demand Source: (1) Clean Disruption Source: RETHINKX

76 Up to 70% of Deepwater Oil, Shale Oil, Oil Sands Uncommercial = Stranded Assets Source: (1) Clean Disruption Source: RETHINKX

77 Implications abc7news.com

78 TaaS Disruption Implications Financial: money in your pocket 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 Social: Increased mobility for all Elderly / Pensioners Disabled Young Poor, Unemployed, Underemployed Image: Tony Seba Source: RethinkX

79 Image: Tony Seba TaaS Disruption Implications Environmental & Geopolitical Environmental 80% decrease energy consumption 90% decrease in CO2 emissions Decreased use of materials (20 vs 2000 & 200k vs 500k) Geopolitical Oil Energy Independence Foreign Policy: energy security less critical Source: (1) Source: Clean Image: Disruption RethinkX Tony Seba

80 TaaS Disruption Implication: Parking will be Obsolete Car Fleet ~80% smaller 80%- 90% vacant parking spots in CBD Instead of money-losing parking, Bellevue can build green parks, walkable & social space AND increase the tax base with new business and residential development Source: (1) Clean Image: Disruption Tony Seba

81 TaaS Disruption - Parking Obsolete: 80%+ Vacant Source: (1) Clean Image: Disruption Tony Seba

82 Walkable Cities -> Wealthier, Healthier, Cleaner Evidence: Correlation between Walkable Cities and Correlation: Walkable Urbanism & Per Capita GDP of Metro Regions (2012 per capita GDP, chained 2005 dollars) Wealthier Cities (GDP per capita) $80k This Disruption of Transportation will help $70k us create Walkable, Vibrant, Diverse Cities that attract the talent who attract businesses who drive economic growth and increase the tax base. TaaS will also give access to transportation to many who don't have Metro per Capita GDP $60k $50k $40k $30k $20k R 2 = 0.57 y =73,024.59x + 36, access today $10k Elderly, Disabled, Young, Sick, Low-income $0 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% % of Metro Region s Offi ce & Retail Space in WalkUPs 50%

83 Once In a Lifetime Opportunity: What City Do We Want to Be? Car Market: From B2C to B2B2C

84 Back to the Future abc7news.com

85 We are here 2017 On the Cusp of the Fastest, Deepest, Most Consequential Disruption of Transportation in History US National Archives

86 We are here On the Cusp of the Fastest, Deepest, Most Consequential Disruption of Transportation in History

88 Thank You! Photo: NASA

89 From Parking to Parks Bellevue & the Disruption of Transportation Bellevue Chamber of Commerce 2017 Eastside Annual Dinner Presentation to: 10 Oct 2017 Bellevue, WA Tony Seba

Disruption of Transportation & Implications for Society

Disruption of Transportation & Implications for Society National Governors Association Webinar Oct 19th, 2017 Tony Seba www.tonyseba.com A STROLL DOWN Memory Lane th 5 AVE NYC 1900 Where is the car? US