As this video shows/discusses, Model Y’s used in Austin’s robotaxi fleet have different hardware, such as self-cleaning cameras, than Model Y’s currently being sold to individuals.
Tesla/Musk have been known to change direction when needed.
The Captain
Wrong. I am throwing out another scenario in the hope of nudging the discussion back to the thread title, i.e., what is the market like vs where Tesla is in getting there.
And yes, I think parents will do this … and people generally will do lots of things and will come to expect to be able to do them … and that makes a market.
Gotcha. Well, again - the market for ridehail services is “big” in absolute contexts, but not “bit” compared to Tesla or Google. Uber’s got the dominant position in ridehailing, and their market cap is “only” about $150 billion - and that includes all their services other than transport, and transport services in countries where self-driving is a very long time from coming. So, figure the value of taking 100% of what Uber has in places where self-driving is coming in any commerically viable timeframe is…what? $100B? Maybe a bit more or less?
It’s just not that big unless the tech advances to the point where you’ve got something that is L5 or a near-universal L4. In which case this isn’t really about the Robotaxis any more, but the fact that someone now can make an L5 or near-universal L4 vehicle, and that product takes over from conventional “dumb” cars in a big slice of the auto market.
But Robotaxis that are the sort of fleet-owned, support-network-needing TaaS products that are currently being rolled out by Tesla and Waymo and Zoox? Just not that big, relative to Tesla and Google and Amazon.
But, aren’t you making a mistake of looking at one specific market, announcing that is not big enough, and then dismissing as unconsidered a whole bunch of not quite big enough markets which together add up to a great big market?
No? Or rather, isn’t that an different question than the one being discussed in this thread? Which is about the size of the specific Robotaxi market, not a bunch of other markets that aren’t Robotaxi markets?
Yes, if you developed an L5 car there will be people who will be willing to buy it for their personal use and ownership. But that’s not a “Robotaxi,” is it? I mean - that’s people buying a car. If you’re discussing how big the Robotaxi market is, presumably that means the market for ridehailing transportation services in a manner similar to a taxi or an Uber? Not me owning my own car and using it only for my own transportation?
No one doubts that if Tesla (or Google or Amazon or BYD or whomever) developed a real L5 car that they could sell a ton of them. But does that mean the Robotaxi market is especially big relative to the size of Tesla or Google or Amazon? I don’t think it is.
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Seems to me that there are multiple ways one might interpret this question. We could be polite and ask what Smorg’s intent was in posing the question … only ride-hailing? … only Tesla? … etc. Or, we can look at the question more broadly in case we can identify something that would be meaningfully additive to simple ride-hailing success. And for starters I would suggest that if one got an L4/L5 car good enough to really succeed at ride-hailing that there are a lot of other things it might do … such that ride-hailing might not be the largest income stream … and certainly wouldn’t be the only one.
Smorg has me in his p-box, so I can’t ask him. But the video clip was about how Uber’s eventual market wasn’t limited to the size of black car/taxi market as it existed at the time, but that due to Jevon’s paradox they expanded that market so that more people were using ride-hailing services. The interview participants did not then go into how Uber expanded into UberEats and delivery services and other non-rideshare markets. Just how Uber, by being cheaper and more efficient than taxis and black cars expanded the size of that market.
So I interpreted the question as being that same dynamic, applied to Robotaxis. IOW, a discussion of the actual markets that Robotaxis are entering into - not that the technology being developed for Robotaxis might be useful in making money in some different market. But again, since you’re probably not in Smorg’s p-box, you can ask him.
Not much point in the whole thread being you and I discussing what should be in the thread so I will leave it here and see what, if anything, people make of it.
I tend to think it’s a novelty. “ooohh…I’m in a JohnnyCab!”. The on-board tech would be so expensive that it’s cheaper have a cabbie, or use the Uber business model. Also, you wouldn’t be able to deploy these sorts of taxis in many areas because they only really work in good weather.
I really see more potential for long-haul trucking. A driver that never gets tired, and doesn’t have federally-mandated breaks. Shorter delivery times should result. But that’s just my opinion.
They are not mutually exclusive, instead they are mutually reinforcing as they feed from the same infrastructure, AI, batteries, motors, lithium…
Tesla needs to be seen as the conglomerate or vertically integrated business it is. This structure reduces costs and the cheaper things get the larger their market becomes.
Short sighted investors wanted stock buybacks. instead Tesla will be allocating some $20 billion in 2026 to six production facilities.
Tesla targets $20B+ CapEx in 2026 amid Optimus expansion and Model S/X wind-down
These past few days I have been reviewing my portfolio strategies, what to do with TSLA, my largest position. TSLA has not done much these past five years.
Five year chart:
With all these projects coming online over the next couple of years TSLA should see the next Big Leap Forward. So just keep on creating income with covered calls but not at the expense of capital gains.
The Captain
Maybe, but long-haul trucking may have more political issues. Truck drivers have more political power than cab drivers. Unions, and all that. Already a hot issue in California:
California politics could cause a reversal on autonomous trucks - POLITICO
You would likely end up with a number of states that are just fine with autonomous trucks, of course. But unlike taxi service or personal transport, long-haul trucking is often interstate. So it matters a lot more that there be some uniformity in rules, since even having a few states not allow autonomy can undermine the advantages.
True. I was just speaking about the technical side and applications. The politics are another matter (and at least as important). Even without the unions, each state on the route would have to have laws allowing autonomous vehicles (trucks). If New Mexico doesn’t, the I-10 corridor becomes less useful to autonomous trucks (for example).
I wouldn’t expect any meaningful revenue (say even 1% market share in US) from in-house built L4 autonomous taxis this year or next year from Tesla in the US.
They don’t yet have a working product and will also need 10s of millions of true autonomous miles to demonstrate safety better than human.
Is there a reason or scenario to expect meaningful revenue for Tesla from a US L4 robotaxi in the next two years, given what they have demonstrated in Austin over the last 12 months?
I don’t see a likely scenario where that is achievable.
Maybe 2028 now?
If they can get L4 working and start accumulating true autonomous miles?
I suppose there is a moonshot scenario in which in the next year they improve their AI driver safety by 2-3 orders of magnitude and approach human-level safety and gather 20 million autonomous miles.
That would surprise me and many others.
(Tesla is in the march of 9s to safety, which looks like a marathon:
)
But a rapid path is not what they are demonstrating in Austin.
In Austin, they give human-driven taxi rides with a few hyper-cautious and restricted maybe unsupervised rides.
On the other hand, Waymo now has L4 commercial service in 10 US metro areas, and more in pipeline, and accumulates data from millions of true autonomous miles each week.
Waymo is also moving towards their next generation of vehicles and moving to highways and cities with winter weather.
Tesla is falling behind Waymo every day, by miles and entire markets and demonstrated L4 capability.
With Waymo advancing, we now have a point of reference for Tesla robotaxi, something to benchmark against.
To support the stock, Tesla could potentially do something else besides build a working, commercial L4 product, such as merge with SpaceX, or focus more on humanoid robots, or some other pivot.
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