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Tesla is wasting time, money and focus by investing too much in self-driving tech (they're even having their own chip division now! - is Tesla really in financi

by mtgx 8y ago

Tesla is wasting time, money and focus by investing too much in self-driving tech (they're even having their own chip division now! - is Tesla really in financial a position to compete with Intel/Nvidia now?). Not to mention they made all of their Model 3's thousands of dollars more expensive by including the "full self-driving hardware-that-wasn't" in every unit to the point where it didn't even make sense for Tesla to sell the base model anymore. Keep it simple stupid - focus on making great high-value EVs, and keep dropping their prices in a profitable manner. Stop throwing billions of dollars on "full self-driving tech" that will never work well enough.

c0vfefe 8y ago
> Keep it simple stupid - focus on making great high-value EVs, and keep dropping their prices in a profitable manner. Problem is, self-driving is an essential part of their image of high-tech luxury. Their marketing strategy depends on being the opposote of KISS. Making the best cars they can while also being electric is the only way to get the volume necessary to make electric affordable.
cagenut 8y ago
there is a line of reasoning, rarely articulated, that EVs will never reach the price points it would take to fully 100% replace ICE cars in the private/personal market. li-ion batteries have done an excellent job walking down the learning/cost curve, but we can all see the way it bends and how much headroom is left in the chemistry. we'll likely hit $100/kwh in the next few years, but even just $80/kwh is likely 5+ years away after that. the model 3 will never start with a $2. so if you're going to bottom out at around 3x the price it would take to fully replace the existing market... then you have to figure out a way to get 3x+ the value out of the asset you're delivering. that means some combination of lasting 3x longer (~500k miles) and/or being in use 3x more (~600hrs/year). the former is viably unlocked by the EV engineering advantages, but w/r/t the latter, individual drivers have no intention of tripling their car usage. so it simply has to be turned into some kind of shared asset. imho self driving makes this a nirvanna, so I'm glad they're pursuing it, but its not actually required. tesla could add a basic uber/lyft feature set to their existing app and then when the last 0.01% of self driving winds up taking years longer than elon said it would he can blame the regulators and just make it a regular human-driver ride sharing app. remember the mission is the end of carbon emissions, so any plan for "lets just get good market share and margins in the luxury segment" is a plan to fail.
- jp555 8y ago
  I've read that the wiring harness of a modern ICE car costs more than the transmission. Do you think it's possible that all we need is ~$100/KWh, after which due to diminishing returns, find better ROI improving other areas like a dramatically cheaper wiring harness?
  - cagenut 7y ago
    Yes but its not enough and its not soon enough. Tesla needs to stoke demand this quarter. Humanity needs to be driving toward zero emissions yesterday. IMHO privately owned electric vehicles will only ever have been a historical oddity of the transition between personally owned cars and shared/pooled cars.
- telchar 8y ago
  I think that view neglects the costs of the fossil fuel infrastructure. At some point gas stations are going to start closing for lack of customers. That time is a while off yet, but all of the existing stations are not going to be able to be supported by say, half as many ICE cars. Convenience will go down and at some point prices may go up as the existing infrastructure is paid for by fewer stations and less fuel. At the same time electrics will continue getting better, cheaper and more convenient. This could provide an extra push.
  - cagenut 7y ago
    I agree with your points on a longer time horizon, but elon needs to solve for model3 demand now (this year). EVs will not drive the kind of oil distribution market retraction you're describing until they're at least 10% of cars on the road, which would be years and years after they're 10% of new cars sold. So while I agree the affect you describe will help, we don't have time to wait for it.
    - WorldMaker 7y ago
      I think the time horizon for a step change in oil distribution is a lot shorter than people expect, precisely because it will be more likely a severe step change (ie, a snowball/crash) than an easy transition. Oil distribution is extremely complex, amazingly baroque, and has only a small number of players (they use a shell game [Shell Oil pun intended] of a large number of different "station" brands, but are really only a few companies left). When instability hits, it is likely to hit hard and look almost immediate (look at 70s Oil crises, for example). I don't yet have a guess what percentage of the car fleet needs to be EV for that to happen, but that number is also not the only potential disruption that may happen to cause it (again, we have the 70s Oil crises as examples). (Not that causing an Oil crisis is necessarily the right way to combat climate change, but in the question of chicken-and-egg between ICE and EV, people sure have a short memory for how volatile Oil is.)
sjwright 8y ago
I think you underestimate how many companies do chip design. That part of it is actually quite unremarkable. And while that transitional Nvidia hardware obviously isn't ideal, it's still necessary to run Autopilot today. And it is what is allowing Tesla to gather mountains of real world training data for its machine learning algorithms. I'm not confident Tesla will pull off their vision of a driverless taxi business, but if they do pull it off, the business fundamentals promise astronomical revenues. Nobody questions that Uber and Lyft are viable businesses. Tesla's plan is to be in their space but with cheaper fuel, cheaper labor and a greater revenue share.
JohnJamesRambo 7y ago
I don't care about self-driving tech in the least, for me it is about as likely for us to get level 5 autonomy as us getting nuclear fusion soon. Just make a good cheap electric car that works. The new Tesla chip info I've heard promising it next year sounds like a complete lie/classic Elon Musk fabrication. https://www.inc.com/geoffrey-james/elon-musks-dumb-lie-about-smart-cars.html https://www.inc.com/geoffrey-james/elon-musks-dumb-lie-about...

by mtgx 8y ago

c0vfefe 8y ago

> Keep it simple stupid - focus on making great high-value EVs, and keep dropping their prices in a profitable manner. Problem is, self-driving is an essential part of their image of high-tech luxury. Their marketing strategy depends on being the opposote of KISS. Making the best cars they can while also being electric is the only way to get the volume necessary to make electric affordable.

cagenut 8y ago

there is a line of reasoning, rarely articulated, that EVs will never reach the price points it would take to fully 100% replace ICE cars in the private/personal market. li-ion batteries have done an excellent job walking down the learning/cost curve, but we can all see the way it bends and how much headroom is left in the chemistry. we'll likely hit $100/kwh in the next few years, but even just $80/kwh is likely 5+ years away after that. the model 3 will never start with a $2. so if you're going to bottom out at around 3x the price it would take to fully replace the existing market... then you have to figure out a way to get 3x+ the value out of the asset you're delivering. that means some combination of lasting 3x longer (~500k miles) and/or being in use 3x more (~600hrs/year). the former is viably unlocked by the EV engineering advantages, but w/r/t the latter, individual drivers have no intention of tripling their car usage. so it simply has to be turned into some kind of shared asset. imho self driving makes this a nirvanna, so I'm glad they're pursuing it, but its not actually required. tesla could add a basic uber/lyft feature set to their existing app and then when the last 0.01% of self driving winds up taking years longer than elon said it would he can blame the regulators and just make it a regular human-driver ride sharing app. remember the mission is the end of carbon emissions, so any plan for "lets just get good market share and margins in the luxury segment" is a plan to fail.

jp555 8y ago
I've read that the wiring harness of a modern ICE car costs more than the transmission. Do you think it's possible that all we need is ~$100/KWh, after which due to diminishing returns, find better ROI improving other areas like a dramatically cheaper wiring harness?
- cagenut 7y ago
  Yes but its not enough and its not soon enough. Tesla needs to stoke demand this quarter. Humanity needs to be driving toward zero emissions yesterday. IMHO privately owned electric vehicles will only ever have been a historical oddity of the transition between personally owned cars and shared/pooled cars.
telchar 8y ago
I think that view neglects the costs of the fossil fuel infrastructure. At some point gas stations are going to start closing for lack of customers. That time is a while off yet, but all of the existing stations are not going to be able to be supported by say, half as many ICE cars. Convenience will go down and at some point prices may go up as the existing infrastructure is paid for by fewer stations and less fuel. At the same time electrics will continue getting better, cheaper and more convenient. This could provide an extra push.
- cagenut 7y ago
  I agree with your points on a longer time horizon, but elon needs to solve for model3 demand now (this year). EVs will not drive the kind of oil distribution market retraction you're describing until they're at least 10% of cars on the road, which would be years and years after they're 10% of new cars sold. So while I agree the affect you describe will help, we don't have time to wait for it.
  - WorldMaker 7y ago
    I think the time horizon for a step change in oil distribution is a lot shorter than people expect, precisely because it will be more likely a severe step change (ie, a snowball/crash) than an easy transition. Oil distribution is extremely complex, amazingly baroque, and has only a small number of players (they use a shell game [Shell Oil pun intended] of a large number of different "station" brands, but are really only a few companies left). When instability hits, it is likely to hit hard and look almost immediate (look at 70s Oil crises, for example). I don't yet have a guess what percentage of the car fleet needs to be EV for that to happen, but that number is also not the only potential disruption that may happen to cause it (again, we have the 70s Oil crises as examples). (Not that causing an Oil crisis is necessarily the right way to combat climate change, but in the question of chicken-and-egg between ICE and EV, people sure have a short memory for how volatile Oil is.)

sjwright 8y ago

I think you underestimate how many companies do chip design. That part of it is actually quite unremarkable. And while that transitional Nvidia hardware obviously isn't ideal, it's still necessary to run Autopilot today. And it is what is allowing Tesla to gather mountains of real world training data for its machine learning algorithms. I'm not confident Tesla will pull off their vision of a driverless taxi business, but if they do pull it off, the business fundamentals promise astronomical revenues. Nobody questions that Uber and Lyft are viable businesses. Tesla's plan is to be in their space but with cheaper fuel, cheaper labor and a greater revenue share.

JohnJamesRambo 7y ago

I don't care about self-driving tech in the least, for me it is about as likely for us to get level 5 autonomy as us getting nuclear fusion soon. Just make a good cheap electric car that works. The new Tesla chip info I've heard promising it next year sounds like a complete lie/classic Elon Musk fabrication. https://www.inc.com/geoffrey-james/elon-musks-dumb-lie-about-smart-cars.html https://www.inc.com/geoffrey-james/elon-musks-dumb-lie-about...