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Uber may be looking to purchase thousands of autonomous cars, but it seems that no deal has been finalized:
Ride-hailing service Uber has sounded out car companies about placing a large order for self-driving cars, an auto industry source said on Friday. "They wanted autonomous cars," the source, who declined to be named, said. "It seemed like they were shopping around."
Loss-making Uber would make drastic savings on its biggest cost -- drivers -- if it were able to incorporate self-driving cars into its fleet. Volkswagen's Audi, Daimler's Mercedes-Benz, BMW and car industry suppliers Bosch and Continental are all working on technologies for autonomous or semi-autonomous cars.
Earlier on Friday, Germany's Manager Magazin reported that Uber had placed an order for at least 100,000 Mercedes S-Class cars, citing sources at both companies. The top-flight limousine, around 100,000 of which Mercedes-Benz sold last year, does not yet have fully autonomous driving functionality.
Another source familiar with the matter said no order had been placed with Mercedes-Benz. Daimler and Uber declined to comment.
Auto industry executives are wary of doing deals with newcomers from the technology and software business who threaten to upend established business models based on manufacturing and selling cars. "We don't want to end up like Nokia's handset business, which was once hugely profitable...then disappeared," a second auto industry source said about doing a deal with Uber. [...] Earlier this week Mercedes rival BMW said it was considering launching its own ride hailing service in what would amount to a rival business to Uber.
An order of 100,000 Mercedes S-Class cars would cost billions, even with a steep discount. Reuters hasn't removed the reference to the 100,000 Mercedes-Benz cars, as seen above.
(Score: 3, Interesting) by VLM on Monday March 21 2016, @12:05PM
at least 100,000 Mercedes S-Class cars ... The top-flight limousine, around 100,000 of which Mercedes-Benz sold last year ...
Worth pointing out the well known walmart effect where a dying brand can sell its soul by providing any price point imaginable when selling to walmart due to the enormous volume.
I'm not claiming it'll be a $3K yugo from the 80s, but I could totally see vinyl seats that are easier to clean drunken puke off than fine corinthian leather. Or if the car always parks itself in nice areas or away from other cars or rarely parks at all or no one cares the door panels can be thinner and less dent resistant. I'm sure a deal for 100%+ of annual production comes from the factory and no cut at all for a stealership. The AI driver isn't going to appreciate a large fast engine. The AI can be told to steer around potholes instead of fancy suspension.
Something rarely considered is the price curve of what marketing can get people to pay for cars is extremely wide compared to the actual cost of production which is darn near a constant. The cheapest car on the road that meets modern federal requirements costs about $16K to manufacture and the biggest most obese truck ever seen costs about $25K to manufacture. So the average new car on the road nationwide might result in $5K of profit out of $30K, but due to statistical deviation that does NOT mean that a $150K car costs $150K * 25/30ths to manufacture. Likewise the commuter car I bought a couple years back was basically manufactured by Toyota as a public service in order to gain access to sell giant pickup trucks for 300% profit or whatever. The mashable link claims 100K cars would cost $10B list. But I would be surprised if the total contract cost exceeded $3B. It'll probably be NDA'd to hell and back to protect the marketing brand but it should show up in the financial statements somehow.
There's an interesting euro angle, where Mercedes is seen as an aspirational brand in the USA but in euro-land Mercedes means "taxi". I hesitate to say all the taxis in euroland are Mercedes but... One time in Ireland I did get a taxi ride in a weird volkswagon giant hatchback "thing", like a Gremlin but slightly cooler looking. So aside from the obvious surface story, its a shout out to expansion in euro-land, a direct attack on almost every human German Mercedes-driving taxi-driver.
(Score: 2) by bob_super on Monday March 21 2016, @06:20PM
> The cheapest car on the road that meets modern federal requirements costs about $16K to manufacture
That would mean anything sold under $20k is losing money. Badly.
You may want to check the sales volumes of the subcompact and compact category. They're not loss leaders. I doubt Nissan loses $5k on every Versa they sell, just because.