Tesla claims it will make Auto Garage Shops obsolete due to zero maintenance. Estimate how many jobs will be impacted in the US in 5 years and 10 years.
Google
Tesla
AmazonUSA Population 300 M
Assume life expetancy of 75
Assume 4MN in each age group
Driving Age and Coverate of people in USA
Age group Coverage
0 to 18 0%
18 to 30 60% = 13 * 60% = 7.8 * 4
31 to 50 90% = 20 * 90% = 18 * 4
51 to 60 50% = 10 * 50% = 5 * 4
61 to 75 0%
Around 120 mn cars
for simplicity we assume that car ownership to person ratio is one
Distribution of 120 Mn Cars into
Peach – Good High Quality Car require maintence once a year
Lemon – Bad Quality Cars require maintenace 4 times a year
In Between – Average Cars which need 2 times maintenace a year
Assuming 20% cars as peach and 20% as lemon and rest in between
Type Maintenance # in year total cars total # of maintenance
peach 1 24 = 24
lemon 4 24 = 96
mid 2 72 = 144
Total = 264 MN
How many mechanics do we need?
1 mechanic need 1 hr to fix a car
average working hours of a mechanic per year
8 hr a day * 5 days a week * 50 weeks (2 weeks as holiday) = 2000
one mechanic can fix 2000 cars per year
2640 * 100000 /2000 = 2640 * 50 = 1320*100 = 1,32,000 mechanics
similarly we can do it for trucks and other utility vehicles
assuming truck delivers too many goods once
we say number of trucks required will be for 20 people
15 mn trucks
repair time 4 hrs
2 per day* 5 * 250 = 2500 per worker per year
150 * 100000 / 2500 = 150 * 40 = 6000 workers
other = 12,000
total = 150,000 workers
Tesla needs maintenance in 10 years = 1,50,000 / 10 will be new need
displaced workers = 1,50,000 – 15,000 = 1,35,000
but for this tesla or ev needs to have 100 percent market share which seems highly unlikely
lets say tesla and other evs penetrate 80% in 10 yeas linearly from 0 to 80
then each year we’ll have 8% displaced workers or 12,000 workers
and by the end of 5 years we will have 60k displaced workers
and by the end of 10 years we will have 120k displaced workers
Approach:
1. Clarify the question
2. Form calculations, input assumptions and calculate
3. Verify calculations and adjust as necessary
Clarifying Qs
1. Auto garage shops in a specific place, i.e. city, state, country, the whole world? The USA
2. Auto garage shops for consumer cars, trucks or other vehicles? Consumer cars
3. Maintenance is anything gas-powered vehicles require, like oil changes, maintenance checks, inspection? Yes
4. “Jobs impacted” means workers who lost their jobs, were retrained or something else? Workers who lost their jobs
Brainstorming Calculations and Inputting Assumptions/Estimates
Main calculation: (# of auto garage shops in US) (# of workers per shop) (% of workers that lose their jobs every 5 years)
Estimate # of cars in US:
300M people in US / 3 people per HH = 100M HH
Assume 70% of Americans have 1 car per HH
(100M HH) (70% of Americans who have 1 car per HH) = 70M cars in US
Estimate # of auto garage shops:
Assume each shop can service 100 cars
70M cars in US / 100 cars per shop = 700K shops
Estimate # of workers per shop:
Assume 10 workers per shop
(700K shops) (10 workers per shop) = 7M workers
Estimate % of workers that lose their jobs every 5 years
Assume 50% of workers lose their jobs every 5 years
(7M workers) (50% who lose their jobs in the first 5 years) = 3.5M jobs impacted in first 5 years
(3.5M workers left) (50% of workers who lose their job in the next 5 years) = 1.75M jobs impacted in 10 years
Verify