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I would argue that the most significant way in which Tesla have the lead is simple but a bit unintuitive. It's that their customers pay for the cars. Think abo

I would argue that the most significant way in which Tesla have the lead is simple but a bit unintuitive. It's that their customers pay for the cars. Think about how much capital will be required to put a million Waymo vehicles on the road. How many zeros are there on that number? Who is going to be paying that bill? Given this, even if Waymo are first to driving 100% perfectly, I expect that Tesla will eventually leapfrog them.

ra7 6y ago
> Think about how much capital will be required to put a million Waymo vehicles on the road. Waymo can just license the tech and sensor suite to manufacturers and make money off that. They don't need to actually build and sell a million Waymo vehicles.
- fullshark 6y ago
  Yeah this is ultimately the case Waymo are in the lead, if you imagine the only way this happens is if eventually one organization gets the hardware/software/dataset/patents that makes full self-driving possible and they will license it to everyone else, then Waymo is the most likely candidate.
sidibe 6y ago
Waymo is part of a company that is sitting on $100B+, if they thought rolling out their own cars everywhere was worth it they could afford it easier than Tesla, but also they don't need to do it in a capital intensive way, they can partner with car manufacturers or ride hailing businesses and just be responsible for the driver.
- jfoster 6y ago
  They have $100B+, but do they want to spend it all in one go like that? Sure, there's also ways to split or reduce the cost, but those also require things to be done. How long do you think it takes Waymo to get their stuff ready for a new vehicle model? Last I heard, it was between 6 and 12 months. The beauty of the Tesla model is that they've already made tonnes of the cars that should eventually be able to do this. Furthermore, instead of each vehicles being a cost for them, the vehicles are a source of revenue. I acknowledge that it does all hinge upon Tesla reaching a point with their autonomy where it can be unsupervised. Some people say they will never get there, but I think that's pretty shortsighted. The data collected by their existing fleet is a massive advantage. Let's not forget that it's been more than 11 years since the first video of what became Waymo, and they can pretty much only drive a small area in Phoenix, with high likelihood of needing to train extensively for every new location as they're now doing in California. Tesla are doing most of the world in (more or less) one go.
  - dragonwriter 6y ago
    > The beauty of the Tesla model is that they've already made tonnes of the cars that should eventually be able to do this. The problem with Tesla is that while they've sold cars with that as marketing claim, there is very little reason to believe that its true. And cars don't have an infinite shelf life; sure, they've sold lots of vehicles with that claim, but even if it were true, a whole bunch of those are already 1/4 of the way through an average US vehicle lifespan, and Tesla may end up with lower lifespan given its rock-bottom initial quality.
reitzensteinm 6y ago
Once it's confident in the technology and business model, Google can absolutely afford the capex of putting a million Waymo cars on the road. They'd probably take out a massive loan, and the worst case is having to ditch the lidar gear and sell the fleet on the second hand market. But it's doable. But where did you get a million cars from? To equal Tesla's existing fleet? Uber has 3 million active drivers globally. If you assume that they're working in 8 hour shifts, 1 million Waymo cars is a rollout sized to replace Uber. Coming at the math from another direction, Uber does 1.6 billion rides a quarter. A million cars would mean 18 rides per car per day. Totally doable. But Waymo would surely focus on countries with high wages - US, Canada, UK, Australia, most of Western Europe. Replacing Uber in only those countries would only need perhaps 500,000 cars. Of course they're going to ramp up towards those numbers, but once the tech works and it's just a matter of cash, it's going to happen very quickly.
- gbronner 6y ago
  Current setup seems to work on existing cars. They can just sell conversion kits for a few years -- it will be like an aftermarket stereo. They don't need to own all the cars.
  - reitzensteinm 6y ago
    I just don't see that happening. Uber is worth $65 billion and they have to give 80% of their revenue to their drivers. If Waymo can get a 60% gross margin instead of a 20% gross margin, their profits could be an order of magnitude higher. This is a trillion dollar opportunity, and its the first thing Alphabet is seriously pursuing that can rival search. Aftermarket conversion kits are a rounding error and there's no long term moat. And that's before you start to get in to issues like improper installation and use, aftermarket modification, accidents causing bad PR when the gear isn't even running etc. Remember that AEB demo a decade back where the car just slammed in to the object it was meant to stop for and it turned out they hadn't turned it on? Nightmare.
dragonwriter 6y ago
> I would argue that the most significant way in which Tesla have the lead is simple but a bit unintuitive. It's that their customers pay for the cars. Yes, they definitely have the lead in outsourcing costs. > Think about how much capital will be required to put a million Waymo vehicles on the road. Actual deployment, not counting developing the technology, maybe, what, $100 billion or so at the outside, given a generous guess at the unit cost of the cars and a generous multiplier to cover other deployment capital costs. > How many zeros are there on that number? 8 > Who is going to be paying that bill? Well, I mean, if they couldn't convince outside investors, Alphabet could do it with cash on hand and still have money left over, but if they can demonstrate the technology, investors will be falling all over themselves to jump on board.
- jfoster 6y ago
  I think Waymo won't have too much trouble actually finding the money to do it, but it's quite wasteful to have a $100 billion cost on something where it's in the vicinity of $100 billion revenue* for your competitor. *: I don't know the actual number.

ra7 6y ago

> Think about how much capital will be required to put a million Waymo vehicles on the road. Waymo can just license the tech and sensor suite to manufacturers and make money off that. They don't need to actually build and sell a million Waymo vehicles.

fullshark 6y ago
Yeah this is ultimately the case Waymo are in the lead, if you imagine the only way this happens is if eventually one organization gets the hardware/software/dataset/patents that makes full self-driving possible and they will license it to everyone else, then Waymo is the most likely candidate.

sidibe 6y ago

Waymo is part of a company that is sitting on $100B+, if they thought rolling out their own cars everywhere was worth it they could afford it easier than Tesla, but also they don't need to do it in a capital intensive way, they can partner with car manufacturers or ride hailing businesses and just be responsible for the driver.

jfoster 6y ago
They have $100B+, but do they want to spend it all in one go like that? Sure, there's also ways to split or reduce the cost, but those also require things to be done. How long do you think it takes Waymo to get their stuff ready for a new vehicle model? Last I heard, it was between 6 and 12 months. The beauty of the Tesla model is that they've already made tonnes of the cars that should eventually be able to do this. Furthermore, instead of each vehicles being a cost for them, the vehicles are a source of revenue. I acknowledge that it does all hinge upon Tesla reaching a point with their autonomy where it can be unsupervised. Some people say they will never get there, but I think that's pretty shortsighted. The data collected by their existing fleet is a massive advantage. Let's not forget that it's been more than 11 years since the first video of what became Waymo, and they can pretty much only drive a small area in Phoenix, with high likelihood of needing to train extensively for every new location as they're now doing in California. Tesla are doing most of the world in (more or less) one go.
- dragonwriter 6y ago
  > The beauty of the Tesla model is that they've already made tonnes of the cars that should eventually be able to do this. The problem with Tesla is that while they've sold cars with that as marketing claim, there is very little reason to believe that its true. And cars don't have an infinite shelf life; sure, they've sold lots of vehicles with that claim, but even if it were true, a whole bunch of those are already 1/4 of the way through an average US vehicle lifespan, and Tesla may end up with lower lifespan given its rock-bottom initial quality.

reitzensteinm 6y ago

Once it's confident in the technology and business model, Google can absolutely afford the capex of putting a million Waymo cars on the road. They'd probably take out a massive loan, and the worst case is having to ditch the lidar gear and sell the fleet on the second hand market. But it's doable. But where did you get a million cars from? To equal Tesla's existing fleet? Uber has 3 million active drivers globally. If you assume that they're working in 8 hour shifts, 1 million Waymo cars is a rollout sized to replace Uber. Coming at the math from another direction, Uber does 1.6 billion rides a quarter. A million cars would mean 18 rides per car per day. Totally doable. But Waymo would surely focus on countries with high wages - US, Canada, UK, Australia, most of Western Europe. Replacing Uber in only those countries would only need perhaps 500,000 cars. Of course they're going to ramp up towards those numbers, but once the tech works and it's just a matter of cash, it's going to happen very quickly.

gbronner 6y ago
Current setup seems to work on existing cars. They can just sell conversion kits for a few years -- it will be like an aftermarket stereo. They don't need to own all the cars.
- reitzensteinm 6y ago
  I just don't see that happening. Uber is worth $65 billion and they have to give 80% of their revenue to their drivers. If Waymo can get a 60% gross margin instead of a 20% gross margin, their profits could be an order of magnitude higher. This is a trillion dollar opportunity, and its the first thing Alphabet is seriously pursuing that can rival search. Aftermarket conversion kits are a rounding error and there's no long term moat. And that's before you start to get in to issues like improper installation and use, aftermarket modification, accidents causing bad PR when the gear isn't even running etc. Remember that AEB demo a decade back where the car just slammed in to the object it was meant to stop for and it turned out they hadn't turned it on? Nightmare.

dragonwriter 6y ago

> I would argue that the most significant way in which Tesla have the lead is simple but a bit unintuitive. It's that their customers pay for the cars. Yes, they definitely have the lead in outsourcing costs. > Think about how much capital will be required to put a million Waymo vehicles on the road. Actual deployment, not counting developing the technology, maybe, what, $100 billion or so at the outside, given a generous guess at the unit cost of the cars and a generous multiplier to cover other deployment capital costs. > How many zeros are there on that number? 8 > Who is going to be paying that bill? Well, I mean, if they couldn't convince outside investors, Alphabet could do it with cash on hand and still have money left over, but if they can demonstrate the technology, investors will be falling all over themselves to jump on board.

jfoster 6y ago
I think Waymo won't have too much trouble actually finding the money to do it, but it's quite wasteful to have a $100 billion cost on something where it's in the vicinity of $100 billion revenue* for your competitor. *: I don't know the actual number.