Khosrowshahi made the unusual move of including a brief update on the company’s plans for autonomous vehicles in the prepared remarks [PDF] that he delivered ahead of the Q4 2024 earnings report.
The remarks began by stating that 2024 would be a turning-point for the AV sector, as at least four operators have fleets on the road and many more are likely to follow soon. The CEO estimates that AVs are a trillion dollar opportunity in the US.
He then became gloomy and said: “Even as we see AV technology advancing, we expect AV commercialization will take significantly longer.”
Khosrowshahi claimed that for widespread commercial AV adoption to take place, five things must be in place. The first is a “consistently superhuman safety record.”
“We don’t think it’s good enough for an autonomous driver to be better than a human. I think we have the chance to be multiple times better than a human,” Khosrowshahi added that only superhuman safety would convince regulators to let AVs on the road. The CEO wants uniform regulation across the US and for more jurisdictions to adopt their own AV regulations.
The CEO also believes that carmakers must improve, as today’s AVs are more expensive than human-driven cars and cost up to $200,000 or even more. Until AVs are able to run for less than 2 dollars per hour 2 dollars per mile, they cannot compete.
The ground operations are also a concern. “It is important to note that an average-utilized AV can run as much as 100K miles a year, compared to a typical consumer vehicle at 10-15K miles a year,” Khosrowshahi wrote. “This means that AVs need to be charged multiple times a day and serviced monthly. AVs will also require consistent cleaning and available parking.” Someone will also need to handle fare dispute, return lost items and rescue stranded cars, as well as handle insurance chores. Uber’s CEO believes it can handle all of that.
But he also admitted that Uber will struggle with the variable demand for AVs.
This is because consumers expect their cars to arrive within four minutes. To meet peak demand, AV taxi operators would need to have a fleet that is underutilized the majority of the time. Uber’s [PDF] presentation included the graph below to illustrate the problem. It shows the demand over the course of a week in an unnamed US City. Each day is divided into four six-hour sections, the first one starting at midnight.
Click to enlarge the graph of hourly demand for Uber in a single US City over a week.
Uber has also provided a graph that shows changes in demand for rides throughout the year for two US cities.
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According to the CEO, humans will solve this problem “dynamically fulfill demand spikes ā and take a break during demand troughs.” he suggested that AV operators partner with Uber in order to tap into its expertise and get humans on the roads. Uber drivers around the world will find this comforting. They may also agree with Khosrowshahi that the robot economy is not a viable option for the time being. The demise of GM’s Cruise Robotaxi business is another reason to be happy. Uber bucks
Uber recorded $44.2 billion in business during Q4, with $22.8 billion for rides and $20 billion for deliveries. This is an 18% increase year-over-year. The company organized 3.1 Billion rides in the quarter ending December 31, 2024.
Uber received $12 billion from all those rides and deliveries, which is a 20 percent increase year-over-year. Net income was $6.9billion, but $6.4billion of that was “benefit from a tax valuation release.” Another Ā£556m came from “net unrealized gains related to the revaluation of Uber’s equity investments.”
Full year gross bookings were 162.8billion, delivering revenue $44billion and net income $9.85billion, from 11.273billion trips. The company reported 171 million “monthly active platform consumers” throughout the year. Uber predicted a Q1 2025 bookings increase of 17 to 21%, all from humans. (r)
