The Hulu Model as applied to Transportation, by Eric Rivers

Who wants to own a car or anything else when you can pay for things offered as a service that you pay for over and over again? From Eric Rivers at ericriversautos.com:

The car companies plan to stop selling cars in favor of selling “transportation” – as a “service” – instead.

The main reason for this reorientation of their business model is simple: People increasingly cannot afford to buy cars – the average transaction price is now about $35,000 which is  a sum roughly equivalent to half the average American family’s annual income and thus, not sustainable as a purely financial matter.

Meanwhile, cars – themselves – are becoming soul-less appliances very much like cell phones in terms of their interchangeable homogeneity and their disposability.

People are for that reason losing interest in them.

But cars are very much unlike  cell phones in one critical way: their cost. It’s one thing to throw away a smartphone after a year or two; another to do the same with a $35k car after four or five. This problem is going to get much worse, very soon – for two more reasons.

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One response to “The Hulu Model as applied to Transportation, by Eric Rivers

  1. Yes – getting rid of ownership will mean paying rent forever and not just cars. It would be impossible to get out of poverty. But something overlooked with electric cars is if they become common, what effect this will have for demand for electricity. Not everyone has a car, but everyone needs to heat or cool their home, and cook, etc. Combined with green energy, how will everyones need for electricity be met? Will necessary domestic needs be prioritised or not?

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