Getting from Here to There Darryl Jenkins June 12 2013 Flight Plan I do believe that commercial UAVs will change everything What I missed in the study 3 The really important parts of my study ID: 541566
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Slide1
Robo-Economics:Getting from Here to There
Darryl Jenkins
June 12, 2013Slide2
Flight Plan
I do believe that commercial UAV’s will change everything,
What I missed in the study,
3
. The really important parts of my study
A. Insurance: The 800 pound gorilla,
B. Financing a growing industry
Phasing in the regulations
How the Privacy Issue may play out.Slide3
Why I did this report
I have spent my career in an industry that has destroyed billions of dollars of vale and the opportunity to be in one that creates value is exciting.Slide4
I am a True Believer
This will be a very big industry.
Over the next ten years people will become millionaires from this, and
Some who are currently in this business will fall by the waysides.
The most important part of my study was the necessary conditions. These are things which must happen and if they do not, then everything stalls.Slide5
What I Missed
I was never sure of which business models will prevail: Small owners vs. larger owner of many vehicles. Slide6
What I Missed
In the airline business, the largest owner of airplanes is a leasing company.
Will these exist UAV leasing companies?
Will there be capital vs. operating leases?
Over what time period will these leases be?Slide7
What I Missed
A lot of the answers to these questions will be a function of the rate of technical obsolesce and how important new break-thru is to users.Slide8
The Really Important Parts of my Study
The Necessary Conditions
For this industry to take off in the manner I envision it, a number of things must happen:
Well thought out regulations,Slide9
Trivia Question
In the movie Jurassic Park, why were the outside academic consultants called in?Slide10
Trivia Question
In the movie Jurassic Park, why were the outside academic consultants called in
?
An insurance company threatened to pull coverage because the T-Rex ate one of the workers.Slide11
Trivia Question
What almost killed General aviation in the late 1980’s and early 1990’s?Slide12
Trivia Question
What almost killed General aviation in the late 1980’s and early 1990’s
?
High Cost of Insurance CoverageSlide13
Insurance the 800 Pound Guerilla
The UAV industry will die in its infancy if the following forms of insurance are not available:
Manufacturers liability,
Hull Insurance,
Users and operators liability.Slide14
Insurance the 800 Pound Guerilla
If a company has uncovered liabilities:
You cannot get financing to grow!Slide15
Insurance the 800 Pound Guerilla
Currently, you can get manufacturers liability insurance in the United States. What we do not have is:
Hull insurance, and
Operators and users liability insuranceSlide16
Insurance the 800 Pound Guerilla
We could probably without much effort get the following:
Liability for operators and users for rural areas.Slide17
Insurance the 800 Pound Guerilla
The likelihood for getting liability insurance for users and operators for UAV’s in non-rural areas out of the gate, is very limited.
We have little or no data and the potential liabilities are very high.Slide18
Insurance the 800 Pound Guerilla
Insurance will pick the initial winners and losers.
Those who have insurance will have a better chance of finding financing.
No insurance, no financing.Slide19
Insurance the 800 Pound Guerilla
This tells us right out of the gate that using UAV’s for home deliveries of pizzas and tacos is a total non-starter.Slide20
Insurance the 800 Pound Guerilla
Insurance may be the solution to some of the privacy issues.
If manufacturers, users, operators, financiers, insurers were to agree to an ethical standard of conduct then the fruitcakes can be marginalized. Slide21
Insurance the 800 Pound Guerilla
There is a law universally decreed before the foundation of this world, that fruitcakes (those who will misuse UAV’s) always appear at Holy times and when you do not want them.
This can be the biggest issue facing the long term regulation of UAV’s.Slide22
Insurance the 800 Pound Guerilla
The idea behind using insurance to marginalize the privacy issue is to get rid of the bulk of the fruitcakes as they can never be totally eliminated.
If we can do this we go way down the road on this issue.Slide23
Insurance the 800 Pound Guerilla
The issuance of hull insurance will be tricky and initially somewhat costly. However, bulk commercial purchases of UAV’s are impossible without hull insurance.Slide24
Insurance the 800 Pound Guerilla
An necessary condition for bringing down hull insurance costs is an industry wide database.
Manufacturers, operators, and users will have to share data.
This has its own privacy issues, but these are minor compared to the need and easily handled thru proper contracts.Slide25
Financing the New Frontier
Growing industries desperately need cash:
There is no growth without cash to finance inventory and capital needs, growing payrolls, etc.
Slide26
Financing the New Frontier
For some this will not be a problem.
For others, the need for cash will be at the center of every decision.Slide27
Questions
Darryl Jenkins
airjenkins@aol.com
540-364-6913