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Launching in 2020 means two years (starting in 2018) of using the more expensive and slower Nvidia chip. By using the 14nm process now, Tesla paid far less on u

Launching in 2020 means two years (starting in 2018) of using the more expensive and slower Nvidia chip. By using the 14nm process now, Tesla paid far less on upfront dev costs (we're talking tens of millions versus billions) and saved on unit costs right out the gate, putting them in better position for smaller process sizes in the future. Volta architecture is much more general purpose than Tesla's. If you're doing a custom ASIC hyper-focused on your application and you're not selling hundreds of millions of them, it doesn't make sense to lock yourself into paying of dev costs for cutting edge fabrication techniques with risk of yield problems and questionable per-unit economics.

dragontamer 8y ago
> Launching in 2020 means two years (starting in 2018) of using the more expensive and slower Nvidia chip. You mean a cheaper and more industry established MobilEye EyeQ5 chip, with LiDAR capabilities, Tensor Units and all that good stuff. ------------ Let me ask you this: how many vehicles do you think Tesla will make in 2018 and 2019? A million? Two million? Do remember, 2018 Tesla made only 244,920 cars. 2019 Q1 only had 70,000 cars, so Tesla is currently producing cars at a rate under 300,000 cars/year (maybe growing to 350,000 by the end of the year). Maybe Gigafactory 3 comes up in early 2020, and Tesla then makes 500k cars for 2020. So... just about a million cars between 2018 to 2020, and I'm being quite generous on Tesla's growth potential here. Remember: not all of those cars having FSD or autopilot installed. I'm not seeing how this 14nm chip is going to be a financially sound move for Tesla. They just don't make enough cars and they weren't watching out on industry standard chip upgrades.
- Robotbeat 8y ago
  14nm is a sound move for Tesla exactly because their volumes are lower. All their cars will have the new chip installed as it's part of the safety features as well (and gives them margin whenever someone decides to do an upgrade on their existing vehicle).
  - hef19898 8y ago
    With these low volumes the sound move would be to buy chips from someone else. Just like Aston Martin is sourcing engines from third parties. Heck, even Mercedes is using Renault engines and BMW used Peugeot engines in Minis for years. And engines are a core competency of both, BMW and Mercedes. Chips for Tesla, not so much.
    - Robotbeat 8y ago
      The thing is that no one makes a chip like Tesla wants that is tailored to their workflow. Tesla, by going with the 14nm process and inexpensively licensing core IP (i.e. for the ARM cores) and only customizing the NN portion, is able to keep chip dev costs low enough so that in the end they're saving a little money on unit costs, getting a power/performance benefit, and as a bonus is building in-house expertise that enhances their value as a company. That's not a bad plan, IMHO. Also, a side note, but maybe it was a bad idea for BMW to use Peugeot engines in the Mini... I've not heard good things about them... (Which is irrelevant to the point at hand, of course.)
      - hef19898 8y ago
        Regarding the last point, not really. It gave BMW access to smaller engines then they had in-house. AFAIK they switched to BMW engines once this whole down sizing started and they had the engines in house. And MINI sales were never an issue, so the idea was sound. Aside from some potential benefits down the road coming from proprietary chips I don't see why Tesla would do it. Also the use cases are so similar that the use of in-house chips will hardly be a competitive advantage. So why burn additional cash on it if you can't afford it? Tesla, and Musk, are risking everything by loosing focus and discipline. Even at SpaceX with their in-house satellite is goeing that way now. No idea why you would do that either.
        DennisP 8y ago
        To go to Mars, SpaceX needs lots of steady revenue and low-cost launches. The more launches SpaceX does, the lower the cost per launch, due to the manufacturing learning curve and high reusability. Rather than wait for customers to come up with applications that require lots of launches, they made their own.

dragontamer 8y ago

> Launching in 2020 means two years (starting in 2018) of using the more expensive and slower Nvidia chip. You mean a cheaper and more industry established MobilEye EyeQ5 chip, with LiDAR capabilities, Tensor Units and all that good stuff. ------------ Let me ask you this: how many vehicles do you think Tesla will make in 2018 and 2019? A million? Two million? Do remember, 2018 Tesla made only 244,920 cars. 2019 Q1 only had 70,000 cars, so Tesla is currently producing cars at a rate under 300,000 cars/year (maybe growing to 350,000 by the end of the year). Maybe Gigafactory 3 comes up in early 2020, and Tesla then makes 500k cars for 2020. So... just about a million cars between 2018 to 2020, and I'm being quite generous on Tesla's growth potential here. Remember: not all of those cars having FSD or autopilot installed. I'm not seeing how this 14nm chip is going to be a financially sound move for Tesla. They just don't make enough cars and they weren't watching out on industry standard chip upgrades.

Robotbeat 8y ago
14nm is a sound move for Tesla exactly because their volumes are lower. All their cars will have the new chip installed as it's part of the safety features as well (and gives them margin whenever someone decides to do an upgrade on their existing vehicle).
- hef19898 8y ago
  With these low volumes the sound move would be to buy chips from someone else. Just like Aston Martin is sourcing engines from third parties. Heck, even Mercedes is using Renault engines and BMW used Peugeot engines in Minis for years. And engines are a core competency of both, BMW and Mercedes. Chips for Tesla, not so much.
  - Robotbeat 8y ago
    The thing is that no one makes a chip like Tesla wants that is tailored to their workflow. Tesla, by going with the 14nm process and inexpensively licensing core IP (i.e. for the ARM cores) and only customizing the NN portion, is able to keep chip dev costs low enough so that in the end they're saving a little money on unit costs, getting a power/performance benefit, and as a bonus is building in-house expertise that enhances their value as a company. That's not a bad plan, IMHO. Also, a side note, but maybe it was a bad idea for BMW to use Peugeot engines in the Mini... I've not heard good things about them... (Which is irrelevant to the point at hand, of course.)
    - hef19898 8y ago
      Regarding the last point, not really. It gave BMW access to smaller engines then they had in-house. AFAIK they switched to BMW engines once this whole down sizing started and they had the engines in house. And MINI sales were never an issue, so the idea was sound. Aside from some potential benefits down the road coming from proprietary chips I don't see why Tesla would do it. Also the use cases are so similar that the use of in-house chips will hardly be a competitive advantage. So why burn additional cash on it if you can't afford it? Tesla, and Musk, are risking everything by loosing focus and discipline. Even at SpaceX with their in-house satellite is goeing that way now. No idea why you would do that either.
      - DennisP 8y ago
        To go to Mars, SpaceX needs lots of steady revenue and low-cost launches. The more launches SpaceX does, the lower the cost per launch, due to the manufacturing learning curve and high reusability. Rather than wait for customers to come up with applications that require lots of launches, they made their own.