Elon Musk made recent comments about Tesla’s Full Self-Driving effort, saying he believes that just some “smart retail investors” understand the worth that Tesla goes to create.
During Tesla’s conference call for the discharge of its Q4 2022 financial results yesterday, CEO Elon Musk made some comments about Tesla’s self-driving effort.
The CEO claimed that the majority persons are missing the worth that he believes Tesla goes to create with Full Self-Driving:
Something that I believe a few of these smart retail investors understand but I believe numerous others possibly don’t – is that each time we sell a automotive, it has the power, just from uploading software, to have full self-driving enabled, and full self-driving is clearly convalescing very rapidly. In order that’s actually an incredible upside potential because all of those cars, with a number of exceptions, only a small percentage of cars don’t have Hardware 3, in order that implies that there are hundreds of thousands of cars where full self-driving will be sold at essentially 100% gross margin. And the worth of it grows because the autonomous capability grows. After which, when it becomes fully autonomous, that could be a value increase within the fleet. That is likely to be the largest asset value increase of anything in history. Yes.
Musk has previously stated that when Tesla finally delivers on its self-driving guarantees, it’s going to unlock tens of hundreds in value in each Tesla vehicle through the capability to show them into robotaxis.
Nevertheless, the CEO hasn’t mentioned that service in a protracted time as Tesla missed several previously announced timelines. Now Musk has been mainly focusing comments on improvements to Tesla FSD Beta. He has stayed away from offering a timeline to deliver on the promised capabilities.
Electrek’s Take
I all the time wish to watch out once I talk negatively about Tesla FSD because I do consider that by itself the product is impressive and the people developing it are doing an incredible job – for essentially the most part.
My fundamental problem with the situation is the discrepancy between the present capability of the product and what Tesla, and more specifically Musk, has been promising for now seven years. There’s that, and there’s the constant moving of the goalpost.
At first, it was 1 million robotaxis by the tip of the yr, then it was 1 million people on FSD Beta, and now it’s just 400,000 people on FSD Beta and no word on an actually useful full self-driving product.
What Musk doesn’t seem to grasp is that each single investor on earth understands that an organization delivering full self-driving capability in hundreds of thousands of vehicles can be an enormous assets value increase and, yes, potentially the largest of any in history, as Musk says.
You don’t should be that smart to grasp that.
The doubts that Musk is hearing, and I assume what’s leading him to say something like this, will not be attributable to a lack of know-how of the worth of self-driving but about whether Tesla will ever deliver that capability on these hundreds of thousands of cars.
Musk and Tesla have lost numerous credibility on that front attributable to the previously mentioned missed deadlines and moved goalposts. There’s definitely room for doubts.
The CEO said yesterday that “full self-driving is clearly convalescing very rapidly,” but that’s not my experience after a yr of using it in my automotive, neither is it the experience of most FSD Beta users I do know who will not be primarily pandering to Musk or attempting to justify to themselves having purchased the expensive feature or Tesla stocks.
Musk has been known to dam critics on Twitter, and he has surrounded himself with yes-men and sycophants who keep telling him how amazing FSD Beta is.
And again, I believe it’s amazing that Tesla achieved what it did with FSD Beta if the feature lived in a vacuum without the various guarantees made. If Tesla had never promised anything and just unveiled this through software updates in its cars, we might all be impressed.
But in comparison with the guarantees of a robotaxi service, it’s a disappointing product with no clear path to achieving the corporate’s guarantees on the present hardware.
If I’m going into my Tesla straight away and activate FSD Beta, I feel more like a driver-ed instructor attempting to teach a confused 16-year-old first-time driver than someone being driven around by a robotaxi. It doesn’t make for a greater driving experience.
I’d be OK with that if there have been a transparent path for Tesla to realize the robotaxi capability, but with Musk believing that the progress has been incredible when it’s hard to see any meaningful improvement from a user basis during the last yr, it’s becoming harder to consider him or to consider within the product.
I believe that’s the disconnect between Musk believing people don’t understand the worth of self-driving through software updates and other people actually beginning to have serious doubts about Tesla delivering it.