Tesla's real plan is to disrupt itself with the robot cars.

[CarlK]

I have just posted this on the Tesla forum. I'm copying it here since there are probably many here who are interested. Let's discuss.

It has just dawned on me we are witnessing the biggest transformation of the auto industry in the entire automotive history. Our resident visionary Elon Musk is conducting this transformation again. No it's not the EV transition but transition to robot cars although the two are pretty related. We have all been beating on wrong bushes.

Let's look at the history:
-- Elon said in 2015 self driving project was Tesla's top priority. People to be recruited will report directly to him.
-- FSD and TeslaNet was put on the master plan deux as a major goal of the company.
-- Tesla put hardware in every car at likely a pretty stiff cost.
-- When asked how much of Tesla's expenditure was on the self driving car project he said (I think sarcastically) all of it.

Two serious questions are raised here. Why cash strapped Tesla would want to spend those serious money over the years on the project that has little to do with making and selling compelling cars? Isn't it a whole lot better to use the money to strengthen the bottom line and profit to boast the stock price? The other one is Tesla sells car because they are nice drive. What's the point of making driving unnecessary and taken away one of its most desirable traits? The only logical explanation is Elon saw robot cars as the inevitable disruption. With his AI involvements he's in the best position to see that. He wanted the disruption to come from Tesla instead of someone else.

There is this eerie similarity of this to what had happened to Netflix, another company I admire a lot. By the later part of 2000's Netflix's DVD by mail model had dominated the video watching business and killed off all competitors. Then Netflix seemed to have abandoned this position and switched the entire focus to streaming. It had caused its stock to drop more than 75% but the rest are of course history. It's very hard to disrupt your own dominate business. Only visionary with greatest confidence is able to take the risk and be rewarded.

You might say I like to drive my car and I want to do it instead of having cars to drive themselves. Elon likes to drive too but he also knows the reality. He can see how this technology will lead us to. It's very likely that in ten years few would drive their own cars and in twenty years no one will be allowed to. Toyota, VW, Mercedes, Ferrari... I don't care who you are. You will die if you can't compete in the robot car business in the future. It won't even take 10 or 20 years for consumers to see writing on the wall. Elon did say buying a car today is like buying a horse. He's not joking.

One more thing why I said this is still related to his mission. Making robot cars is the best and most cost effective way to get rid of ICE cars.

 

[electricar]

During the Autonomy Day livestream Elon said the public will demand autonmous cars instead of 4,000 " death machines ". It seemed odd then that the car on the stage looked like a roadster - a car that can go from 0-60 mph in 1.9 seconds. Will he be throwing away the steering wheel and pedals on those too?

 

[CarlK]

I kind of think Roadster and even pickup are just his pet projects. There will still be a transition priod people can and will enjoy to own or drive their own cars. His real goal seems to be to make millions of robot cars mainly model 3/Y though.

 

[Camera-Cruiser]

"Tesla" and "plan" often seems oxymoronic. If they have a plan, it is to stay afloat long enough to come up with another plan to stay afloat.

I don't write the above in jest, I have their cars and want them to succeed, but I worry when Musk, or anyone says "Mark my words." once, let alone multiple times. Tesla's competition may not be as visionary, but I won't write them off as all doing a fool's errand either.

Vision is a great thing, but who wouldn't want it, and other sensors that see the environment even better working better than just vision?

I should probably stop here to stay on topic, but...

My model 3 can barely get in and out of my garage without running into either side of it or parking like a drunken sailor. To back into my garage straight, I have to have it perfectly aligned, or it will take out the side of the car, and it pretty garage door.

So I just don't know how they are going to get from where they are now, to being able to get in and out of a private or public garage, down a driveway and out onto public streets with trash cans, trash trucks, construction crews, pot holes, sink holes, emergency vehicles, toddlers on tricycles, cats and dogs - alive or squished, equestrians, bicyclist's, tree trimmers, street vendors, and homeless crisscrossing the streets all before the car gets to the freeway. You have to be able to make decisions about all of those and countless others. Musk made a big deal about having the best computer for autonomous driving. Great. But has to make life and death decisions too.

I can't see Autopilot or any real level 5 projects passing regulatory approval until the trolly car experiment can be taken into account. Who lives, who dies in autonomous vehicles and out. Does the car know to squish a cat, dog, or squirrel instead to the 3 year on a tricycle?

Not to be morose, but what is the car going to do when it comes upon a body or injured party on the road? With and without passengers in the car? Because there are multiple scenarios in either case. Either way, hazard lights should come on and a call to emergency services placed. Without passengers, the car should probably stay in a position not to let the body or injured person get struck by another vehicle. But with passengers, maybe it should do the same, but ask them to exit the vehicle??? Maybe it should pull off the road to keep from being struck to protect the paying passengers, maybe it should query the passengers on what to do? It's endless, and it is life and death.

 

[CarlK]

There are a lot of discussions on the autonomous driving forum and I've been a long time champion of the Tesla program. That was 100% confirmed, imho, by what was said in the investor self driving event on Monday. My opinion in the op was based on that conviction. Sure it's fine to think otherwise if you don't share the same believe.

Watch that event, not sure if it's still available on youtube now, if you have not yet. That should answer all your questions of things like how the car could navigate out of the garage and avoid trash cans (by vision neural net machine learning). Here are some of posts I had on the autonomous forum. Those can explain where I am coming from. Again imho Tesla, and only Tesla, has the tool for us to get there in the forseeable future.

Autonomy Investor Day - April 22 at 2pm ET

Autonomy Investor Day - April 22 at 2pm ET

 

[neroden]

As you all know, I believe level 5 is very far away. However, I take Carl's point: nobody else is going to disrupt Tesla's business by developing robocars before Tesla does; Tesla has just made sure of that.

 

[larmor]

I have just posted this on the Tesla forum. I'm copying it here since there are prabably many here who are interested. Let's discuss.

It has just dawned on me we are witnessing the biggest transformation of the auto industry in the entire automoative history. Our resident visionary Elon Musk is conducting this transformation again. No it's not the EV transition but transition to robot cars although the two are pretty related. We have all been beating on wrong bushes.

Let's look at the history:
-- Elon said in 2015 self driving project was Tesla's top priority. People to be recruited will report directly to him.
-- FSD and TeslaNet was put on the master plan deux as a major goal of the company.
-- Tesla put hardware in every car at likely a pretty stiff cost.
-- When asked how much of Tesla's expendeture was on the self driving car project he said (I think sarcastically) all of it.

Two serious questions are raised here. Why cash strapped Tesla would want to spend those serious money over the years on the project that has little to do with making and selling compelling cars? Isn't it a whole lot better to use the money to strengthen the bottom line and profit to boast the stock price? The other one is Tesla sells car because they are nice drive. What's the point of making driving unnecessary and taken away one of its most desirable traits? The only logical explanation is Elon saw robot cars as the inevitable disruption. With his AI involvements he's in the best position to see that. He wanted the disruption to come from Tesla instead of someone else.

There is this eerie similarity of this to what had happend to Neflix, another company I admire a lot. By the later part of 2000's Netflix's DVD by mail model had dominated the video watching business and killed off all competitors. Then Netflix seemed to have abandoned this position and switched the entire focus to streaming. It had caused its stock to drop more than 75% but the rest are of course history. It's very hard to disrupt your own dominate business. Only visionary with greatest confidence is able to take the risk and be rewarded.

You might say I like to drive my car and I want to do it instead of having cars to drive themselves. Elon likes to drive too but he also knows the reality. He can see how this technology will lead us to. It's very likely that in ten years few would drive their own cars and in twenty years no one will be allowed to. Toyota, VW, Mercedes, Ferrari... I don't care who you are. You will die if you can't compete in the robot car business in the future. It won't even take 10 or 20 years for consumers to see writing on the wall. Elon did say buying a car today is like buying a horse. He's not joking.

One more thing why I said this is still related to his mission. Making robot cars is the best and most cost effective way to get rid of ICE cars.

This is a great analogy. Pivot shift is the new business paradigm. Netflix took a huge step and risk when they first decided to charge twice as much-- one for streaming and one for DVD, and then disrupt their own model. Then taking that analogy further, instead of netflix functioning as a broker for films (content) they now make their own on par if not better.

Apple pivoted and so did many others. Tesla would pivot from selling cars to selling rides based on the paradigm of safety. Just as netflix changed the paradigm based on convenience--who misses blockbuster?

What is tesla's next pivot: wireless energy transmission for global redistribution of energy, and perhaps as an aid or backup to Mars travel, but would need a lot of satellites, just sayin'. I'm going to sell tinfoil hats.

 

[sillydriver]

I have just posted this on the Tesla forum. I'm copying it here since there are prabably many here who are interested. Let's discuss.

It has just dawned on me we are witnessing the biggest transformation of the auto industry in the entire automoative history. Our resident visionary Elon Musk is conducting this transformation again. No it's not the EV transition but transition to robot cars although the two are pretty related. We have all been beating on wrong bushes.

Let's look at the history:
-- Elon said in 2015 self driving project was Tesla's top priority. People to be recruited will report directly to him.
-- FSD and TeslaNet was put on the master plan deux as a major goal of the company.
-- Tesla put hardware in every car at likely a pretty stiff cost.
-- When asked how much of Tesla's expendeture was on the self driving car project he said (I think sarcastically) all of it.

Two serious questions are raised here. Why cash strapped Tesla would want to spend those serious money over the years on the project that has little to do with making and selling compelling cars? Isn't it a whole lot better to use the money to strengthen the bottom line and profit to boast the stock price? The other one is Tesla sells car because they are nice drive. What's the point of making driving unnecessary and taken away one of its most desirable traits? The only logical explanation is Elon saw robot cars as the inevitable disruption. With his AI involvements he's in the best position to see that. He wanted the disruption to come from Tesla instead of someone else.

There is this eerie similarity of this to what had happend to Neflix, another company I admire a lot. By the later part of 2000's Netflix's DVD by mail model had dominated the video watching business and killed off all competitors. Then Netflix seemed to have abandoned this position and switched the entire focus to streaming. It had caused its stock to drop more than 75% but the rest are of course history. It's very hard to disrupt your own dominate business. Only visionary with greatest confidence is able to take the risk and be rewarded.

You might say I like to drive my car and I want to do it instead of having cars to drive themselves. Elon likes to drive too but he also knows the reality. He can see how this technology will lead us to. It's very likely that in ten years few would drive their own cars and in twenty years no one will be allowed to. Toyota, VW, Mercedes, Ferrari... I don't care who you are. You will die if you can't compete in the robot car business in the future. It won't even take 10 or 20 years for consumers to see writing on the wall. Elon did say buying a car today is like buying a horse. He's not joking.

One more thing why I said this is still related to his mission. Making robot cars is the best and most cost effective way to get rid of ICE cars.

I think your comment is great and completely agree. Here is my spin on it which isn't stated as clearly as yours.

Finally saw the replay last night. I hung on every word of the chip presentation. I’m the kind of nerd who read Microprocessor Report in the ‘90s for the pure joy of learning whose translation lookaside buffer had the lowest miss rate. And my interest in neural nets dates back to Rumelhart’s “Parallel Distributed Processing.”

With that said, the single comment I found most noteworthy was Elon’s saying that Tesla’s cars now shipping (by which I assume he meant the Model 3) are designed for a million-mile useful life, the same spec as for large trucks. Doing this obviously makes achieving a gross cost that supports a $35k price more difficult. The same is true about their currently shipping all the systems redundancy needed to achieve reliable autonomy. And in terms of profitability, his comment that the cost of developing autonomy was essentially the company’s whole expense structure was also telling.

This is not meant as a criticism: I want them to succeed and I am not a short. My high level conclusion from all this – which has been pretty obvious all along, but the comments in this presentation somehow drove it home for me at a more emotional level – is that Elon really has a completely different view of what business he is in, and of which success factors are important and which are not, than any other car company. A view that is differentiated by much more than electrification. He is pursuing a certain vision of the future of transportation, whether in space, in tunnels, or on surface roads, that is not evolutionary. And he is pursuing his vision even if it takes him off the path of maximizing business success and survival in the nearer term, that path being one where he would refresh his luxury car to have more luxury, cost-cut his affordable car to have more affordability, fix the bugs and deficiencies in his driver-facing software, and use his expense structure to generate more sales either through advertising or more frequent styling changes to stimulate repeat buying.

No, he is pursuing a vision of what customers ultimately will want, even though they don’t realize it yet (a la Steve Jobs, only more so). I will say that I, for one, shudder at the thought of buying a car only to let a bunch of probably vandalous strangers ride around in it while I am having dinner. I similarly shudder at the thought that the most fun-to-drive car I’ve ever owned (and I’ve had some good ones) won’t be shipped with a steering wheel in a few years. But then I’m 60 years old, so I’m probably not the best indicator of trends in the future.

It will be interesting to see how it all unfolds! FWIW I thought both the hardware and software presentations were very good. It seems like their on-chip memory architecture allows the multiply-accumulate array to have much better utilization than would GPUs that fetch their data off chip. I would also love to ask them about the number of distinct neural nets they now use and plan to use, and their specific roles, particularly in path planning/driving policy, which they implied is now mostly heuristics implemented on conventional CPUs, and relatedly I would ask about the different levels of abstraction that the different nets operate at: e.g. pixel processing vs. processing various representations of identified objects.

 

[Camera-Cruiser]

There are a lot of discussions on the autonomous driving forum and I've been a long time champion of the Tesla program. That was 100% confirmed, imho, by what was said in the investor self driving event on Monday. My opinion in the op was based on that conviction. Sure it's fine to think otherwise if you don't share the same believe.

Watch that event, not sure if it's still available on youtube now, if you have not yet. That should answer all your questions of things like how the car could navigate out of the garage and avoid trash cans (by vision neural net machine learning). Here are some of posts I had on the autonomous forum. Those can explain where I am coming from. Again imho Tesla, and only Tesla, has the tool for us to get there in the forseeable future.

Autonomy Investor Day - April 22 at 2pm ET

Autonomy Investor Day - April 22 at 2pm ET

I watched the event. That is how I knew Elon said "Mark my word" more than once. It was cringe-worthy, and I am a fan. I listened to them explain vision and how they intend it work. I hope it will continue to get better, and meet and exceed expectations. I want it to work for everyone's sake.

But navigating a car from A to B is one thing, what I'm talking about is decision making that goes beyond, go around trash can, to the other things that I mentioned previously. Vision gets the car around something unscathed, but how does it decide what to do on 1 car wide road when it comes up behind a trash truck and there is another car coming towards the trash truck from the other direction? Who goes first? What if the trash truck starts backing to make room? What if the passengerless Tesla has 5 cars stacked up behind it all honking their horns because the Tesla doesn't know what to do? Can someone walk up to the car and tell it what to do? Does it understand the oncoming driver waving to go first? or, was that person indicating to hold on a second a second because maybe they see something the Tesla doesn't. How many times do you make silent eye contact with another driver, if only to indicate that you see each other and are going to work together for the next 2-3 seconds to resolve/navigate a situation. To me, that is what make the whole thing work - another human silently communicating intent. Even if it is a middle finger, I at least understand to got to Mad Max mode.

Simple really. I think I heard Elon say that too multiple times over 3 hours.

My issue, and Elon made a point of this, is that he does what he says he, or Tesla is going to do..... eventually. The problem I see, and somewhat bringing this back to the point the OP brought up about the new uber-like fleet driving plan, is that Tesla needs to stay in business long enough to get to any of these future plans.

I'm still waiting for 3rd party in-car apps. I think I was told those were coming back in 2013 or so. Not to mention a rear carbon fiber spoiler, underlined rear dual motor badge, wall charger, or any of my phone calls/emails regarding these items.

 

[CarlK]

Watch this video from those guys who had been to the investor event and took rides in the test drive. It should help remove doubts some might have.

 

[mattjs33]

The question is, if Tesla can set up this fleet, why does it need anyone to buy its cars?

All Tesla needs to sell you or I is a subscription to ride in its cars whenever we choose.

Or are Tesla's future customers really only Uber and Lyft? Or whatever comes after them?

I've heard it time and again how it's wasteful having four passenger cars on the road with only one person in them. Is it really the best use of our limited roadway resources, having a bunch of empty cars driving around, to go pick people up?

 

[CarlK]

The question is, if Tesla can set up this fleet, why does it need anyone to buy its cars?

All Tesla needs to sell you or I is a subscription to ride in its cars whenever we choose.

Or are Tesla's future customers really only Uber and Lyft? Or whatever comes after them?

I've heard it time and again how it's wasteful having four passenger cars on the road with only one person in them. Is it really the best use of our limited roadway resources, having a bunch of empty cars driving around, to go pick people up?

This was touched in the video I linked above. It's the business model that is most capital friendly. Other companies need to purchase hundreds or thousands of test cars and hire one or two safety engineers to operate each car. Tesla is having its customers to purchase the cars and work free as safety engineers to help train the machine and develop the neural net.

It is not to sell cars to Uber/Lyft but is to be their competitor. Travis Kalanick when he was Uber CEO said if Uber is not among the first to have self drive cars the entire business will no longer exist. It was reported he told a Tesla board member if Tesla could produce half a million self driving model 3 in 2020 he'd buy them all but Tesla did not want to do that (we now know why).

On the second question who says only one passenger will be in the car? You can take many passengers or to car pooling if you want to. Uber/Lyft are already driving around so there is no added burden if its done autonomously. You can also require cars to wait at parking places until they are hailed.

 

[mattjs33]

It is not to sell cars to Uber/Lyft but is to be their competitor. Travis Kalanick when he was Uber CEO said if Uber is not among the first to have self drive cars the entire business will no longer exist. It was reported he told a Tesla board member if Tesla could produce half a million self driving model 3 in 2020 he'd buy them all but Tesla did not want to do that (we now know why).

All Tesla is doing is using their current customers to fund Tesla until Tesla no longer needs them. Why sell you a car and then give you a cut on its robotaxi use when they can just keep the whole cut themselves? Why bother building and marketing a fancy car to the whims of consumers when all people will really be buying is the ride? When was the last time you cared about the handling of your taxi?

If Tesla can make this work they don't need you or I or anyone to put a Tesla in their garage. Building taxis no one cares about will be a lot more profitable than trying to compete on features and nonsense like that.

You can take many passengers or to car pooling if you want to.

I love riding with strangers, said no one ever.

Uber/Lyft are already driving around so there is no added burden if its done autonomously.

The number of Uber/Lyft people currently driving around waiting for a fare is already furthering traffic nightmares in cities. It's not solved congestion at all, quite the opposite. More of this capacity will make matters even worse.

 

[CarlK]

You can still buy a Tesla to put in the garage and not to share it on TeslaNet. It will be like having a personal 7/24 chauffeur working for you for free. It can also save you money because you may not need to own multiple cars. It will be easier to share the car among family members.

If the purpose of your posts were trying to shoot a hole I don't think there is a hole in there. The more you look into it the more you feel how smart Elon is to figure out this whole plan that some people still could not figure out even when the whole thing is laid clearly in front of them.

 

[mattjs33]

If the purpose of your posts were trying to shoot a hole I don't think there is a hole in there. The more you look into it the more you feel how smart Elon is to figure out this whole plan that some people still could not figure out even when the whole thing is laid clearly in front of them.

I'm not trying to shoot the plan down, I think it's brilliant. If he can get it to work, by which I mean the Level 5 autonomy.

I'm just pointing out that if he does get it to work, the really doesn't need to sell his cars anymore.

 

[outdoors]

I can see a day when someone says Tesla you can't sell anymore cars. We want to buy them all. Here is a check. A mighty big one. We just want you to produce the fleet. We buy them. People pay us to use them per mile autonomously. We will figure out the other end with customer service. People will do this as the cost to own would be almost a laughable matter. Maybe Tesla will do it on its own, maybe not.

I can also respect those that say those days are way far ahead. Either way I think they will come sooner than we all think. Technology has the ability to leap every now and then. Often when we least expect it.

 

[CarlK]

There is really no advange of selling fleets to anyone, say Uber for example, and add another layer of middlemen. The ride hailing app is pretty easy to do. Uber's only advantage is its driver network. The thing about machine learning is when it happens it will happen very fast. That's what those guys in the vidor said. Tesla only had the AP3 FSD software out for 3 months those demo cars could already do amazing things. Give the machine another 6 month and many more cars to learn it could surprise everyone. How low did it take to have AlphaGo to be able to plane Go to beat the best Go player in the world?

 

[Sancho]

Musk is playing three dimensional chess. If robotaxis don't come to pass because of technological or regulatory hurdles, Tesla will still be disrupting the auto and energy industries, and should be well positioned to become a trillion dollar company. If robotaxis do come to pass, and Tesla is the first mover, Tesla becomes a multiple trillion dollar company, with an even bigger moat because of the network effects of a robotaxi business. It's not easy thinking in three dimensions. Every decision about every car needs to be considered both in light of it being a passenger car, and as an autonomous fleet car.

 

[LJS22]

I think the tech side gets Elon going in what we consider crazy directions. We sit here and want him to perfect the product and service he has going now. He gets bored and starts pushing computer chips to react to real world situations faster than humans.

Tesla likely feels like a slow progression forward for him as he’s watching how fast the technology is advancing. I’m sure there are people trying to pull him back and get him to focus on the current products, but for him it’s all about what’s next. As long as he has the money to fund his brain he will miss on some ideas, but also he’s going to keep pushing forward and continue to revolutionize the industry.

 

[LJS22]

Musk is playing three dimensional chess. If robotaxis don't come to pass because of technological or regulatory hurdles, Tesla will still be disrupting the auto and energy industries, and should be well positioned to become a trillion dollar company. If robotaxis do come to pass, and Tesla is the first mover, Tesla becomes a multiple trillion dollar company, with an even bigger moat because of the network effects of a robotaxi business. It's not easy thinking in three dimensions. Every decision about every car needs to be considered both in light of it being a passenger car, and as an autonomous fleet car.

If he hits on robotaxi then making cars will be nothing but a hobby for him. Which I’m sure is what he wants again. I think the idea of Tesla and designing the first cars was fun, once it became about profits it’s become a burden. I’d love for Musk to get a chance to move forward with a little less stress.