The question for me is still one of where is the moat and is the valuation justified?

Even if Scania, Volvo, Iveco, Man, Kenworth or the other large manufacturers decide to stick to their knitting by building trucks, and say to purchasers you can install whatever computer/tracking device you like (which is what is happening now), what is stopping another startup from taking market share?

It's a bit like Xero - Eroad is going to need to rely on being the first mover, and customers being sticky. Once Xero got off the ground, all the other accounting players offered more or less the same product, and growth in market share is basically by pinching customers off each other.

Eroad may well be sticky, but I think it's too early to tell, and I don't think it's as clear cut as some here think it is.

For me, this one goes into the too hard basket. Good luck to those who are on board for the ride. 

Agree @pudawocky.

With increasing integration of computers into vehicles, commercial fleet operators will look to acquire vehicles where this functionality can be done in-house.

I appreciate that E-Road software can relatively easily transition to other platforms and essentially function as a SaaS plug-in, but the big commercial vehicle manufacturers would be mad not to include such functions on their vehicles, if not as standard, then programmed to order and updated other the air as Tesla do, and others will no doubt follow.

Whilst there is growth to be had before such integration becomes standard, there is in my view, effectively no moat.

It's an avoid for me.

@Pudwocky Great thread, and I agree with the sentiment. The only issue with relying on the ondometer would be those that drive on private land (not many but there'd be some). I think the most likely would still be a simple tracker via GPS of which roads were driven on, you could even have different charges for different roads etc. It can be done if you see the AI in John Deere tractors for example. 

@ Duffshot38 In terms of diffenent OEMs being involved I think its easy for the govenrment to mandate a standardised system or enourage interoperability so that different systems can be used. Agree that this is a few years off though. 

@duffshot38, that's current day thinking. Google maps with live data is no doubt better than a static map receiving traffic data via Suna or BMW's own network (which is derived via Google Maps) etc. The limit on these has been computational power, hardware, and availability/reliability/cost of data.

What happens when Tesla shows the established players how you could do it and what's possible? (I am no Tesla fanboy either).

Eroad fills in the niche today, and quite likely for the next 10 years, so there is some growth to be had.

The problem will be what happens after that, and I think the likelihood of the moat disappearing is pretty good.

A commercial vehicle operator makes investments for vehicles that travel millions of km over their lifetime, and once electric vehicles become commonplace in this space, the manufacturers need to differentiate themselves because the reliability or pulling power of their engines is more or less a moot point for EV. Integrated fleet management is an easy way of doing it.

Will it be better than ERoad? Quite likely not. Will it be good enough? More than likely it will.

The Eroad price assumes a long runway of unhindered growth, which I don't think can be safely assumed. There is definitely some growth to be had, most likely in the USA given reliance on heavy vehicles there.

The current day problem for investors comes back to today's price and long term outlook. All transport operators have fleet management systems in place, so customer acquisition cost is a relevant factor in working out whether you can be invested in Eroad for a good time or for a long time.

To summarise, there is more than likely short term growth on sentiment, but I can't justify the valuation given the unclear long term picture.