Musk: Tesla vehicles are now ’appreciating assets’ due to self-driving

[electronblue]

Tesla vehicles are now ‘appreciating assets’ due to self-driving capability, says Elon Musk

Buying a car today is an investment into the future. I think the most profound thing is that if you buy a Tesla today, I believe you are buying an appreciating asset – not a depreciating asset.

The only way this can be true, and it is with his history no means certain to be, is that the car produces income.

As an asset itself it can not be appreciating given the fact that there is no scarcity (unless he implies Tesla will fail stop selling such cars after delivering on autonomy or that after delivering autonomy the car prices go way up — and by way up it would have to be like 100% up).

Otherwise, realistically, Teslas are some of the most depreciating volume premium cars on the market given the pricing policy and trade-in system of Tesla.

But now we can add a new bullet to the Musk PR list: Tesla’s bought today will be worth more (money-wise) over their lifetime than it cost to buy them.

 

[malcolm]

Brings a new meaning to the phrase, Pimp My Ride.

 

[glide]

How he can continue to make absurd claims like that is beyond me. It is completely factually and measurably inaccurate.

It borders on fraud.

 

[diplomat33]

In context, Musk was talking about FSD. Once you are able to make money with the Tesla Network, then, yes, your car will be an appreciating asset since it will be an extra source of income.

 

[electronblue]

In context, Musk was talking about FSD. Once you are able to make money with the Tesla Network, then, yes, your car will be an appreciating asset since it will be an extra source of income.

Well.

Two things:

1) He said the Tesla you buy today. It does not make any income yet. But I get it, he wants you to buy a Tesla today, not tomorrow.

2) For the car to be an appreciating asset it would have to make more money than is loses in value. Seems questionable for a new car bought today with an income potential potentially far into the future.

Also he didn’t say you can make money with it. He says the Tesla you buy today is an appreciating asset — as in rising in value.

But Elon likes dramatic language for PR effect. Like saying things like ”engineering drag coefficient” or ”several orders of magnitude”... or ”sonars” when talking of automotive-grade ultrasonics... He is good at saying things that make people pay attention and believe. Too bad it isn’t always true.

 

[boaterva]

Appreciating assets don’t ‘make money’, they have to able to be sold for more than you purchase them for. Now, that’s not happening.

So, if it DID make you money (Tesla Network) fine, but neither of these are happening. Yet.

 

[electronblue]

Appreciating assets don’t ‘make money’, they have to able to be sold for more than you purchase them for. Now, that’s not happening.

True. Personally I was just trying to be... open... to interpreting Musk when I considered the overall cost (or profit) of ownership.

But still, given how much a Tesla bought today likely loses in value it is hard to see how it could be apperciating without scarcity.

 

[diplomat33]

1) He said the Tesla you buy today. It does not make any income yet. But I get it, he wants you to buy a Tesla today, not tomorrow.

2) For the car to be an appreciating asset it would have to make more money than is loses in value. Seems questionable for a new car bought today with an income potential potentially far into the future.

He didn’t say you can make money with it. He says the Tesla you buy today is an appreciating asset — as in rising in value

You are forgetting the two Musk/Tesla axioms:
1) The cars we buy today already have all the hardware capable of Full Self-Driving
2) FSD will be feature complete this year and after that, it's only a matter of validation and regulatory approval before our cars will be L4 autonomous.

If the 2 Tesla statements are true, then what Musk said is entirely reasonable. You are buying a car today with the hardware capable of tremendous income potential in the near future since your car will be on the Tesla Network making you money within its lifespan. Furthermore, once the Tesla Network launches, you could probably even sell your car for more than you paid for since the car has that extra income potential. That would indeed make it an appreciating asset.

Remember that everything Musk says is predicated on accepting those two statements as true. Musk is starting from a very different place than a lot of folks here. He is starting with different assumptions. He is starting with the assumptions that those statements are true whereas many folks here are starting from the place that those two statements are false. When you start with different assumptions, you will reach different conclusions.

 

[electronblue]

@diplomat33

I’m starting to believe your assumptions are wrong even from Musk’s perspective. I’m thinking @Bladerskb might be right once again and Tesla Network start out as Level 2.

But be that as it may. Let’s assume a Tesla Network of some kind truly appears in the lifetime of a Tesla bought today. I don’t doubt this possibility as a Level 2 app controlled network certainly is technically possible already today.

For the car to appreciate it would have to have a higher resale value at some point in the future than its original buying price. The only two ways we can see this happening if they are scarce (only happening if Tesla goes under I guess) or if Tesla dramatically raises prices of comparable cars in the future and people still want to buy at that future price (maybe they would if the cars turn out to be truly self-driving, thus driving up CPO prices).

But to a point where used car is more valuable than a new one? These are not rare classics... I don’t see that.

So the real meaning of ”to appreciate” is already out it seems. How about the other one? Making more money for you than it costs to own the car?

Tesla Network would have to become available in your area and be able to generate more income than the depreciation of the car (with its cost of ownership deducted from any income of course as there are mainentance costs to renting the car out)... A usual Tesla loses perhaps from $30,000 up to $100,000 in value during a typical ownership. It would thus have to make more of that (minus cost of maintenance) and still not cut into your personal use value for the car as people do buy cars for themselves to use — I mean if we talk of buying a car just to rent it out, anyone can do that profitably already... that is not appreciating...

Color me sceptical of that happening anytime soon in the generic terms Musk formulated this. But anyone is free to try: buy a Tesla today anywhere in the world and three years from now see if it ”appreciated”.

 

[diplomat33]

@diplomat33

I’m starting to believe your assumptions are wrong even from Musk’s perspective. I’m thinking @Bladerskb might be right once again and Tesla Network start out as Level 2.

For the record, I said those were Musk/Tesla's assumptions. They are NOT my assumptions! I was merely trying to explain how Musk's statements about appreciation can flow out of his underlying assumptions.

I think it is super important to note to note that L2 does not necessarily mean incapable of city driving. L2 may simply mean that Tesla decided to keep the nags as an extra safety precaution like they did for NOA. Tesla may achieve an excellent self-driving and still be L2. Heck, just look at Waymo that still has safety drivers. Even if Tesla did achieve an excellent self-driving system, they might still need safety drivers or nags for safety hence it would still be characterized as a L2 system.

Which is why Blader is actually making a pretty safe bet with the L2 Tesla Network.The odds of Tesla actually achieving true L4 autonomy in the next 1-2 years is incredibly low. And even if Tesla did achieve an amazing self-driving system, they would probably still need safety drivers or nags. So no matter how good Tesla's self-driving is, the odds are very good that blader will be able to characterize it as a L2 system no matter what. So yes, a L2 Tesla Network is likely in that regards.

 

[electronblue]

For the record, I said those were Musk/Tesla's assumptions. They are NOT my assumptions! I was merely trying to explain how Musk's statements about appreciation can flow out of his underlying assumptions.

To be clear, I was trying to say I think the assumptions you presented as Musk’s assumtions may not be even Musk’s assumptions by now, the second one especially.

I think he may believe what he is saying might be possible while sticking to Level 2. Car responsible driving (Levels 3-5) might not be on his radar at all at this stage.

 

[electronblue]

Heck, just look at Waymo that still has safety drivers. Even if Tesla did achieve an excellent self-driving system, they might still need safety drivers or nags for safety hence it would still be characterized as a L2 system.

By the way, having a safety driver does not turn Level 4 into Level 2. It is the design intent that matters. With a Waymo the car is responsible for the drive and the safety driver is there as a redundancy — and that is how it has been designed. That is Level 4. Or a Level 4 prototype.

What @Bladerskb or the subsequent thread desribed for Tesla Network was decidedly Level 2 as at no point would it be designed for car responsible driving.

 

[Skotty]

Tesla vehicles are now ‘appreciating assets’ due to self-driving capability, says Elon Musk



The only way this can be true, and it is with his history no means certain to be, is that the car produces income.

As an asset itself it can not be appreciating given the fact that there is no scarcity (unless he implies Tesla will fail stop selling such cars after delivering on autonomy or that after delivering autonomy the car prices go way up — and by way up it would have to be like 100% up).

Otherwise, realistically, Teslas are some of the most depreciating volume premium cars on the market given the pricing policy and trade-in system of Tesla.

But now we can add a new bullet to the Musk PR list: Tesla’s bought today will be worth more (money-wise) over their lifetime than it cost to buy them.

Personally, I think this is one of the sillier things Musk has mused. Using the car as a self driving taxi cab is still far fetched currently, like commercial fusion reactors. Maybe...some day...they are working on it...but right now it's a silly thing to say.

 

[electronblue]

Personally, I think this is one of the sillier things Musk has mused. Using the car as a self driving taxi cab is still far fetched currently, like commercial fusion reactors. Maybe...some day...they are working on it...but right now it's a silly thing to say.

There is an interesting theory making rounds — what if you think of the Tesla Network as a billing app and a geofence, instead of an autonomous network.

That would not be so hard to implement. An Uber-like app (sans drivers) where you can sign your car to, which handles navigating, billing and basic driving, while the renter is obligated to sit on the driver’s seat and is responsible for taking over as needed. The built-in geofence would make sure you won’t drive away with it, handle car locks and stuff.

It is not a bad theory.

 

[Bladerskb]

Which is why Blader is actually making a pretty safe bet with the L2 Tesla Network.The odds of Tesla actually achieving true L4 autonomy in the next 1-2 years is incredibly low. And even if Tesla did achieve an amazing self-driving system, they would probably still need safety drivers or nags. So no matter how good Tesla's self-driving is, the odds are very good that blader will be able to characterize it as a L2 system no matter what. So yes, a L2 Tesla Network is likely in that regards.

Flip flopping yet again? initially you said my theory was "very unlikely", now its "likely" but only because i will use caveats?

Hate to break it to you but I didn't invent the SAE definitions and the definition for L2, L3, L4, L5 hasn't changed since 2015.
So idk why you are saying i'm the one doing the characterization. no matter how much you love Tesla, they aren't exempt to rules and regulations.

Secondly, Elon said that hands on the wheel will be gone in at-least 6 months (That's Oct 2019 for driver supervision) and that by the end of the year Tesla's "FSD" will be so good that a driver intervening would actually decrease safety. Basically not needing any supervision by next year. He also said he would be shocked if they didn't reach full autonomy without need for supervision/driver intervening by next year.

This is even more than "feature complete by end of the year".

That's not something that is incredibly low. That something that is fraudulent to say. To the point the Lex called it "Faith" and then realized that he insulted Elon with that comment and had to backtrack.

Faith = firm belief in something for which there is no proof

Also people invited to the investor autonomy event can't even record. Which means Tesla knows that their system might/will fail to hand situations in the demo and will be trying to hide the performance/failures of it.

 

[diplomat33]

Flip flopping yet again? initially you said my theory was "very unlikely", now its "likely" but only because i will use caveats?

You are being disingenuous. If you look back at your other thread, you will see that I said that the part of your theory where strangers would be safety drivers was unlikely. I even offered an alternate version of your theory where Tesla owners or Tesla owners would be the safety drivers instead. So I never said that your proposition of a L2 TN was unlikely, I disagreed with your specifics of how it would be implemented.

Hate to break it to you but I didn't invent the SAE definitions and the definition for L2, L3, L4, L5 hasn't changed since 2015.
So idk why you are saying i'm the one doing the characterization. no matter how much you love Tesla, they aren't exempt to rules and regulations.

Ok so my question to you is simple: if Tesla does release the Tesla Network where the car is responsible for all the driving but there is a safety driver as a back up, what level of autonomy is that? Don't give me a dissertation on the SAE levels, just tell me, L2, L3, L4, L5, which one?

Secondly, Elon said that hands on the wheel will be gone in at-least 6 months (That's Oct 2019) and that by the end of the year Tesla's "FSD" will be so good that a driver intervening would actually decrease safety. Basically not needing any supervision by next year. He also said he would be shocked if they didn't reach full autonomy without need for supervision/driver intervening by next year.

Yes, he is saying that because he firmly believes Tesla will achieve L4 autonomy. As I explained before, Musk has consistently stated that a) all cars sold today have the hardware capable of FSD, b) Tesla will be feature complete for FSD this year and c) Tesla will only require further validation and regulatory approval before the system is L4 autonomous. So based on those claims, Musk is firmly claiming that the Tesla Network will be L4 autonomous. I happen to think his timeline is way too optimistic.

That's not something that is incredibly low. That something that is fraudulent to say. To the point the Lex called it "Faith" and then realized that he insulted Elon with that comment and had to backtrack.

I think Musk is wrong on the L4 timeline but fraud is a different thing.

Also people invited to the investor autonomy event can't even record.

Where did you hear that? Tesla said the event would be livestreamed.

 

[Bladerskb]

You are being disingenuous. If you look back at your other thread, you will see that I said that the part of your theory where strangers would be safety drivers was unlikely. I even offered an alternate version of your theory where Tesla owners or Tesla owners would be the safety drivers instead. So I never said that your proposition of a L2 TN was unlikely, I disagreed with your specifics of how it would be implemented.

Sorry, I read it after i made my post.

Ok so my question to you is simple: if Tesla does release the Tesla Network where the car is responsible for all the driving but there is a safety driver as a back up, what level of autonomy is that? Don't give me a dissertation on the SAE levels, just tell me, L2, L3, L4, L5, which one?

I don't need to dissect anything. its quite obvious. If the driver has to monitor the environment then its L2, if not then its L3 or above. Its clear cut.

Yes, he is saying that because he firmly believes Tesla will achieve L4 autonomy. As I explained before, Musk has consistently stated that a) all cars sold today have the hardware capable of FSD, b) Tesla will be feature complete for FSD this year and c) Tesla will only require further validation and regulatory approval before the system is L4 autonomous. So based on those claims, Musk is firmly claiming that the Tesla Network will be L4 autonomous. I happen to think his timeline is way too optimistic.



I think Musk is wrong on the L4 timeline but fraud is a different thing.

Saying something you know is not true is a LIE. Saying "I actually believe it so its not a lie." as a defense doesn't work. Do you know how many people will use that defend in court to get off scott free?

Therefore its fraud if making that statement will lead to financial gain. Which we obviously know it has.
Saying that Tesla will have L4 full autonomy in 6 months is a balant lie. I don't know how you can rationalize that. Just as much as a lie when he said you will be able to summon your car from across the country by 2018.

Where did you hear that? Tesla said the event would be livestreamed.

Hyperchange on youtube. Sure the event will be livestream but they won't be able to record their individual test drives. Tesla will probably show a pre-recorded test run that went well on the live-stream.

 

[diplomat33]

I don't need to dissect anything. its quite obvious. If the driver has to monitor the environment then its L2, if not then its L3 or above. Its clear cut.

So Waymo cars with safety drivers who are clearly monitoring the environment and the car for any possible mistakes is L2? Good to know. So the Waymo ride sharing network is a L2 ride sharing network when there is a safety driver. Just so that we are clear.

Hyperchange on youtube. Sure the event will be livestream but they won't be able to record their individual test drives. Tesla will probably show a pre-recorded test run that went well on the live-stream.

Interesting. I did not know that.

 

[Bladerskb]

So Waymo cars with safety drivers who are clearly monitoring the environment and the car for any possible mistakes is L2? Good to know. So the Waymo ride sharing network is a L2 ride sharing network when there is a safety driver. Just so that we are clear.

Waymo cars are L4 test/prototype cars.

And no waymo does not have a ride sharing network but their early rider program and waymo one is neither driverless nor L3 or L4.

 

[diplomat33]

Musk just clarified his appreciation assets comment on Twitter. Basically, our cars with FSD are appreciation assets because FSD adds value that will cause the price that Tesla charges to go up.