The Tesla Robotaxi GAME CHANGER (Complete Financial Model)
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- เผยแพร่เมื่อ 23 มี.ค. 2024
- Follow Cern on X: @CernBasher
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Cern is a legend, charts/graphs and models are top notch
Lol herbert couldnt stop smiling hahaha. I couldnt either
Cern is a man of the future and thanks to Herbert for allowing Cern to be a part of the program. Lots of deep thinking and eye opening possibilities
“30 Trillion market cap”
Herbert: Idk seems low
Worth every minute of watching. Thx
Tesla needs to split the FSD monthly fee into two parts:
1) Base cost for personal use (not in Tesla network) -- maybe $100/month to get take rate to >50%
2) Network fee -- $500/month for commercial robotaxi service
This would require blocking FSD commercial use out-of-network, similar to Waymo restriction on who can use their hi-res maps
Had to watch this twice, its so mind boggling. I was just thinking of ways to deter riders from vandalizing, smoking, graffiti, and spilling liquids in the vehicle, and how to keep it clean for the next rider. With the amount of cameras that are in the vehicle, tesla could program the car to take before and after photos documenting the state of the car. If there is a significant difference in the condition of the interior and exterior, then the rider will be billed for the damage. Alternatively a deposit could be collected from the rider before they enter the robo-taxi then refunded if no damage.
Each rider also has every incentive to make sure they don't get blamed for the messes of a previous rider - so they will be documenting the inside of the car too!
Avis and Hertz have figured this out, albeit a different scenario, so will Tesla. Transportation as a service (TAAS) is the future without a doubt. These challenges will be overcome.
Hit 200k today. Thank you for all the knowledge and nuggets you had thrown my way over the last months. Started with 14k in last month 2024..
'''''''''''''
Wow that's huge, how do you make that much monthly?
I'm 37 and have been looking for ways to be successful, please how??
Sincerely speaking. I will continue to trade and stick to expert harr iet daily signals and guides as long as it works well for me...
Woah for real? I'm so excited. harriet dixson strategy has normalised winning trades for me also. and it's a huge milestone for me looking back to how it all started...
I'm new at this, please how can I reach her?"
Amazing insights by Cern, must watch. Great video.
Great models Thank you.
Cern’s insights are so refreshing. Thanks, much appreciated.
The big unlock is freight distribution. As the robotaxi infrastructure grows along with semi and megacharger network, robofreight will displace railroads completely and a chunk of the 4 million class 8 trucks that travel 250 billion miles per year in US alone.
Yes, this is another massive opportunity. Basically, anything that moves will be autonomous.
This was a very exciting and eye opening video. Thank you Herbert and Cern for the awesome insights. Tesla to Mars!
One of the things that Optimus might continously do, is cleaning cars I guess
The video provides food for thought, but Cern's analysis contains what appears to be some oversights.
First, around 48:00, Cern claims that robotaxi fleet operations will be keen to buy many Tesla cars to add to their fleet, and this will significantly increase the price of second-hand Tesla cars. That might happen for, say, the first year or two, but it is unlikely to happen indefinitely, as I can show with results from some internet searches. Number of taxi cars in the USA & Canada: around 300,000. Number of FSD licenses *already* in the USA and Canada: 400,000. New Tesla car sales in USA and Canada in 2023: around 700,000. My point is that if there is a one-for-one switchover from taxis to robotaxis, there are enough existing FSD licenses and high-enough sales of new Tesla cars to quickly supply 300,000 robotaxis. Since robotaxis will be cheaper than taxis, we can expect the market will expand, and so each existing taxi will be replaced with "N" robotaxis, but the need for robotaxis will still be saturated within a few short years. Once that saturation point has been reached, the price of second-hand Tesla cars will decrease. There is recent historical precedent for this. A few years ago, when Tesla couldn't make cars fast enough to meet demand, the price of second-hand Tesla cars briefly rose to be close to, and sometimes higher than, the cost of new Tesla cars, but that artificial inflation of the price of second-hand Tesla cars was eliminated when Tesla was eventually able to make enough cars to meet demand.
Second, around 1:04:40, Cern claims that robotaxis will become so cheap that many people will decide to not own a car and instead rely exclusively on robotaxis. Jevons Paradox (do an internet search for details) suggests otherwise. And there is historical evidence to back this up. Pages 327--330 of "Walkable City (10th Anniversary Edition)" by Jeff Speck cites sources that show Uber (cheaper and more convenient than traditional taxis) has gained an unexpectedly large percentage of its customers from those who previously used public transportation, or cycled/walked. The point is that many people are willing to swap "low cost but inconvenient" (public transport/cycling/walking) for "more expensive but more convenient" products/services (Uber, and soon, robotaxis). In the same way, many people are likely to continue owning their own cars rather than use robotaxis exclusively, because having your own car is more convenient. You may wonder, "But, what if using robotaxis exclusively is 5 or 10 times cheaper than owning a car?" Time will tell, but I know that cooking your own food from scratch and making your own coffee is 5 or 10 times cheaper than buying food/coffee made by somebody else and that still doesn't prevent many (probably most) people buying lunch in the staff canteen or a nearby restaurant and buying coffee in Starbucks, and then getting home-delivered food while binge-watching Netflix.
Can I guarantee that my analysis above is correct and Cern is wrong? No. But the video would have been much better if Cern had addressed such issues, for example, by explaining why he thinks Jevons Paradox may not apply to robotaxis.
Wow. You best yet, Herbert. Thank you! Mind is blown... 😜😜😜
robotaxi can deliver groceries, packages take out food
Thanks!
Thank you again Russell!
I love the way CERN puts a number to a dream!
The model is a good start. Using statistical distributions for the key variables would be awesome for doing sensitivity analysis via monte-carlo simulation.
Fantastic episode!!! Love the thoughtfulness and flexibility of the models presented...keep those assumptions on the low end as you've done so far, it helps assess the low end of the potential for the robotaxi network. Though, need to add that as a business (disregarding the company mission) it wouldn't make financial sense to keep selling cars for Tesla (vs keeping and operating them themself).
Cern & Herbert Thank You for this excellent analysis. Turning a deficit investment into a money printing machine is definitely catchy 😊
Thank you Cern and Herbert. This is the overview that helps us retail investors stay focused on the prize.
Try to ignore the quarterly noise that Wall Street and others want you to focus on!
You could build a business around cleaning/sanitizing the interiors. Automated robots...
Thanks for a great and informative show. Fantastic work @ CernBasher
crazy how much effort he put into it
delivery problems; need to have a driver, pre-paid purchase by buyer online, pay for the "driver", driver's time, more time for loading/unloading, more time for several people's orders at even ONE
store, let alone multiple stores and destinations, what if two customers want to go to 3 stores, grocery shop at one, doctor visit at another, buy at general store, total trip 80 miles?
It’s the Apple model. If autonomous EVs develop, the on-board apps, services, games and and non transport income gets delivered to riders. The TAM is way above the vehicle market which is limited by roads and infrastructure.
Would Naptime = cheap AirBnB (sleep overnight with aircondition) opportunity. If you book “night”. It has to drive to be cleaned, inflatable bed added and duvet etc. It picks up 2 people in the front seats. Drives to a parking lot for the night, and the backseat it for sleeping.
Great post. One of the second level implication that wasn't mentioned is taxation. Currently, fuel tax generates billions in revenues for states. Furthermore, the cost of maintaining and expanding road networks, more billions, gets transferred to the individual in the form of income, municipal, state and federal taxes as well as vehicle licenses. In a situation where one company benefits from the robotaxi bonanza, how do you see the state making up the revenue? Would this be made up through a yearly licensing fee on robotaxis? Or a per milage tax? Or something else? Very curious to get your insight on this. Death and taxes...
Cern touched on a point that I think could be a huge but not discussed major disruption-opening up real estate presently used for parking.If this happened on a large enough scale it could put downwards pressure on land prices and therefore housing cost.I see this perhaps coinciding with much cheaper housing construction costs(3D printing etc.) leading to greater housing provision,even more downwards pressure(through increased supply) causing housing prices to plumit.
Thank you Cern I will be one of the first to paint a sign on a tesla with words "I buy houses" and have it drive around certain areas.
"I buy Teslas"
@@CernBasher lol
@@CernBasher not so funny now that fsd is so close
Very nice, informative video, more of it please :D BUT the cost per mile of $1 is way too high, 25ct is more realistic in the long run as you have to beat public transportation in many countries. AND If a car parked in front of my door costs me 72ct all-in then I'm not paying $1/mile. Just as no private individual will earn $10k per year with it in the long term, because then everyone would have their own robotaxi - which means nobody would have to call one. I understand these are assumptions and in the short term I'm all in. But in the long term, the numbers will drop dramatically, because there will be a lot of competitors in such a business in a very short time.
Agreed, the distance-based fare price will come down over the long-run. I started with $1 per mile and showed later in the video much lower prices.
A future business: You are riding along in your robotaxi. The car speaks to you: “Amazon has a 20% discount on X item (something you usually buy). If you buy it now, this trip to your destination will be FREE.” Amazon will pay for your trip as a perk if you buy the item displayed during your ride.
This is a good point and I'd extend it even further... If you are willing to be subjected to non-stop advertising, you could actually get paid to ride in a robotaxi!
@@CernBasher Ha! Yes, lots of unimaginable possibilities. Thanks, and thank you for all that analysis in this video!!
Robo Taxie can have a sleep mode for customers double shifts jobs want to sleep until next shift
problem hardware. need self cleaning cameras. ie eye lids tear ducks. cars also need a voice interface for passagers and people on the street.
I believe a voice interface is coming...
Many creative and very good points. But main problem - where all this hypothetical demand coming from? Uber charge quite a bit, and have a balance with the public’s propensity to pay, and they also take 30% without any material costs - but they only have 40B revenue. This presentation is inventing the idea that everyone is going to want to be in taxi but the market only bears about 1.5% of trips being taxi paid. Let’s imagine that doubles to 3% and Tesla takes out the entire taxi market - that is 80 billion even if fares don’t go down, and then double that again as Tesla gets closer to 60% without driver, so that is 160 billion. After that market isn’t willing to give much much cash towards taxi fairs - there is an economic demand limit. With a 50% op margin and 30% net margin that is under 50 billion profit, and PE of 20 gives 1 trillion. That is only double what Tesla is trading now and that is if all goes spectacularly well. Good presentation but looks like just entering numbers into a spreadsheets assuming infinite demand.
I think the individual owner is on average able to support 2 cars, one for RT and one for their work. They can buy a used gas car and hold that work car for say a year and save their profit toward a new Tesla and then sell that gas car. So the owner operated RT can make sense over time. In fact most families have the one car already and they could keep it, especially if it's paid off. If it is still on a loan, the profit from the RT can likely cover both cars' payments. I'm likely forgetting some key element that negates this whole idea but that is what I would research if considering going into the RT business.
What makes you think the car/battery will last 600,000 miles? I've seen some ride share drivers report that the battery fails early if it's taxed too heavily with continuous use and charging.
L4/L5 FSD on your vehicle, in the dreams!. A CT converted to act as Robotaxi, owned and operated by Tesla, dream come true!.😇
I am completely amazed because this makes a lot of sense. I already own TSLA but I will buy more. What will happen to UBER? I think this could be a TSLA vs UBER battle.
Im looking forward to cross country road trips in robo taxi. I rather take that than an airplane.
Many people hate flying. And many people want to enjoy the journey, not just arrive at a destination!
for an individual owner of the taxi, utilization might only be 3% to 10%. in small towns- mine is a population of 50 and distance to the grocery store and back is 80 miles, most people are very
independent (not wanting the business)
That was my first thought in the first 15 minutes. 30-65% of the 24 hour day seems very very high. Majority of people are not active for 12 hours in the evening and night and the roads a often pretty empty, even in the big metros.
@@iGreen_think about a customer calling you from a bar at midnight. customer wants to go home.
He gets charged a base price (say $5), miles of travel, minutes of use,
etc. so the trip takes 5 minutes each way = 10 and the charge is 50 cents/minute = $5 plus
base = $10 plus miles 10 blocks = 1 mile x 2 @ 50 cents per mile = $1 + 10 = $11. BUT
the customer falls asleep in front of the customer's house. loud noises and vibration on his phone
don't wake him. sure you get to charge him for time spent in the car without moving. but what do
you do? call the police? get GPS installed in the car and go to his home to wake him up? or let him sleep?
you have his credit card and after a half hour could charge him whatever you want I suppose? You will definitely
have to check his credit card before accepting the ride.
The limiting factor for utilization is battery life.
@36:00 Pls correct me if I'm wrong, but Musk has never said that the new model will sell for X price, but he has said that it will inclided FSD, and he knows the value you present here.
What if, the new cars do not go on sale? And you can only continue to buy from the Semi S3XY Cyber/Roadster lineup? What happens to the price of new/used Tesla vehicles then? 🚀
There is no doubt that new vehicles will be optimized for robotaxi use and they will be cheaper for Tesla to make. But it doesn't change the calculation of the value of a used Tesla. What does impact the value of a used Tesla is the amount of money it can earn as a robotaxi, so if the revenue per mile comes way down, then it might not be economically viable for those individually owned vehicles to be used in the network - but this is likely many years down the road after the network starts up.
Great conversation and presentation by Cern.
The only point I question is that insurance companies will support FSD.
Won't Tesla insurance be a no brainer for FSD-enabled vehicles? They are a direct competitor and disruptor to the insurance industry.
50:55 why sell it when it can work for you 🤔
i just like fsd the software for "Robotaxi" might be charged 10k etc also.
The fleet owner that knocks on your door looking to buy your car will be Tesla. They won’t care whether you have FSD or not since they can add it for free.
Good point.
What if tesla allowed people without fsd to intermittently opt in during peak demand for a reduced percentage of profit. Or possibly earn credits towards an fsd license. I'm just thinking...
They would have to be announcing the building of 10 or more plants now to get to the numbers of "Teslas in the wild", much less a robotaxi fleet at even the lower ends of 10MM cars in the fleet by 2030.
Having said that, I love the Cern videos. He does a lot of great thinking and then charts that explain it.
Even if they remain at 2 million vehicles a year, that will be more than 10 million by 2030.
Yes, but that is 10MM over 5 years, just for their normal demand. Where do you get 10-50MM newer cars to be put into fleets? Doubtful people will want to be driven around in 5 year old, worn cars.
You would drop the customer and the car w ould park and wait for the next ride or charge.
It may not be helpful to make first principle assumptions about average speed, empty miles etc. We already have actual numbers from Uber and others. The most prudent approach would just remove the cost of human drivers from the known (not assumed) business model. We can add some additional utilisation owing to cheaper prices attracting some public transport users. With Cern's model where do all these additional rides come from? People aren't just going to need to move around a whole lot more just because robotaxi exists. We have no idea how many car owners would give up car ownership so that can't be modelled.
Uber isn't everywhere and can't make a profit in places that are remote/small/independent people/poor people, etc. so those businesses will have to charge slightly more to cover problems.
I will likely never sell my Model 3. I'll just maintain it forever. 😊
Nah man, the car will maintain you :P
@@ekibtc Favorite reply in a long time. 😂
How would competition from Waymo affect utilization and price per mile
Competition increases supply and all things being equal, the price per mile would go down - which would further increase demand!
Waymo's need to not cost 100+k to build, and get better at the driving job, and who knows how much energy there vehicles currently use to process the driving data.......
I was curious what robotaxi would look like if we just took the existing ride hailing market and eliminated driver costs.
The worldwide revenue of ride hailing services is in the region of $150b. When FSD is good enough the market will be snapped up by robotaxis because competition will make human driven fleets unprofitable.
Assuming prices halve from $2 to $1 per mile with Cern's net margin of 40%, if the current ride hailing market were replaced by robotaxi, annual net earnings would be around $30b.
Assuming a 10% CAGR until 2030, annual net earnings should be around $58b by that point. Even if Tesla has a 100% market share, a 30 multiple would give this a ~$1.8t contribution to market cap. A 50 P/E would make it close to $3t. What am I missing?
I don't think we should use robotaxi to justify higher use of ride hailing any more than it's currently used. I'd be happy with a trillion dollar market cap plus private FSD subscription revenue.
What you're missing is the massive increase in demand (non-linear) if you drop prices from $2 to $1 per mile (and lower). As the cost per mile falls, increasing numbers of people would decide to get rid of their cars.
This remains to be seen. Personally I'd still want my own car and many current car owners would too. However there could be some percentage of the rail and bus markets taken by robotaxi.
@@user-py7or7zi5k Yes, it could be a gradual shift, unless the economic savings are so large that they're too good to pass up!
red light hotel?
The world's oldest profession will find a way to "optimize" this - although there is a camera inside the car!
Have you taken the tax implications into account? Depreciation, milage write offs, etc...
so a customer calls for a robotaxi. the owner answers and gets all the customer data: starting point, destination, return to base?, return trip, credit card data left open in order to manipulate when
the trip takes longer, destination added on, etc. the car shows up, first leg of trip is completed with no problems, but second leg takes half hour longer due to traffic jam, charge increases and
receipt is printed out to the customer with comments made what, why, etc.
The cost is per mile, not per minute. So the operator will lose those minutes of productivity, but not charge the customer more for being caught in a traffic jam. And all of this will be managed through smartphone apps and AI scheduling, there’s no phone call for a Robotaxi.
I'm investing in Tesla but looks like I'm going to buy one as well.
Hi Herbert, creating the next wave in EV adoption, the common criticism I hear is there is not enough convenient fast charging for renters where home charging is just not possible. These people don’t want to go to a chargers site and fast charge 1x or 2x per week. I have to agree with that. If I had to fully rely on the charging infrastructure sites as it is today , I would not go EV, I don’t need the added stress. I’m fortunate in my case because I own my home, but a large % of people in the Bay Area, home ownership is not in their future. 4 and 5 story apartment complexes with several hundred units per site are the norm here. Apartments don’t have utilities that could support even 120v outlets at that scale. In today’s world, convenience is a must for mass adoption. One thing I have done in my small part of the picture was to install 50 chargers at our workplace. This helps but more is necessary.
Eventually charging stations (with 1 to 100 stalls) will be everywhere. On city streets, instead of a parking meter it will be a charging unit.
I love Crash Bandicoot
Tesla better license FSD to other OEMs and get a premium from them upfront. And have some Fleet management companies as well. At some point it will be a balancing act between shareholders pushing to take the most advantage of the Tesla's position and Politicians trying to push monopoly laws on Tesla.
Can you summarize the charts verbally using numbers? I have to stop the video, squint at the charts on my small phone, guess at the X and y labels, and even then I’m not always sure if I’m interpreting it correctly.
Thank you for this extensive analyse POD. There are many assumptions/predictions but i am sure this will now have entered into Elons head several months even years ago. Its a money making machine but in the future tranportation will be DIFFERENT from 2030
how about replacing batteries and tires? lots of miles and charging. charging cycles would have to be high (6000 cycles?) tires are a bit more because of a heavy car -- maybe 25,000 miles?
That's all included in the model - we discuss it in the video.
Is potential legal/litigation costs and compliance costs thoughtfully considered in modeling potential expenses?
Great research!! Thank you
Of course not, LOL.
I have modeled a good amount for insurance and included a decent amount of "other costs". What are you expecting for legal, litigation and compliance costs?
@@CernBasher I had no expectations for those expenses, just wondered if "other" considered them, which you confirmed they do. Very comprehensive! Thank you!
robotaxi cost/charge leaves out charging the battery time and cost. 2 to 3 minutes doubled for loading AND unloading. Long distance costs, i.e. coming from an airport to pick up a passenger.
so the 5 miles could be way off. step charge for distance instead, i.e. 5 miles or less - low charge, 10 miles to 20 miles medium charge, 25 miles to 50 miles high charge, more than 50 miles extremely high charge.
The charging time is factored into the utilization percentage. For example, if the utilization is 50%, then during the 50% of the time the vehicle is not active in the robotaxi network it is either being used by it's owner (if individually owned/not part of a fleet), charging, getting cleaned, etc. And the charging cost is factored into my model. The number I ran were averages - some trips will be very short and others will be longer (all discussed in the video). The distance traveled and the speed of travel are related - if you can go on a longer trip at a higher speed, then the cost per mile charge should be quite low.
@@CernBasher I live in a village of 50. It is a 40 mile trip one way to a grocery store...or about 35 miles to stores over a pass which is closed 1/3 of the year. I'm hoping to buy a
Tesla e-van if they are ever made that will carry at least 7 people and room for goods. I have a very small business that is essentially a taxi business, but my short bus died with
a blown head gasket. So I've been saving and buying tesla stock (77 shares now) to buy the van. In figuring out how much to charge people for shopping, doctor, dentist, airport,
bar run, etc. I will have lots of miles to put on the van. 80 miles round trip to Walmart for example. It's an hour one way, so two hours total. Most of the people living in town all
year around are old, living on welfare, and essentially poor...as am I. So I don't want to charge them an arm & leg. If I charge them a dollar to get in the car and 40 cents / mile;
that is $33 and that is about what it costs to drive their own car. So I will have to spread out the charge. They should be able to order from Walmart online and have it waiting for
me with a receipt. If they want to come along to shop; then I could charge them 25 cents per mile plus shopping fees. I'll advertise that I will make a shopping run 2 or 3 times
per week if I am home. They can contact me the day before with a list of what they want. So maybe the mileage would be divided amongst them, I'd charge $5 for the trip base.
And try to keep the individual cost down as low as I can. 80 miles x .25 = $20 + $5 base = $25 and if I have 3 customers that's about $8. They would save money and time. I would be able to shop for myself. I have a solar power system that will cut my charging cost down to about half. Only half because there isn't enough sunshine here in the mountains.
Vehicles without FSD will not have to pay Tesla for FSD. They will just have the option of putting the vehicle on the Robo taxi network when not in use. All vehicles are delivered with the software already on the car. All the hardware is already on the car. There is no reason for Tesla to charge an owner unless the owner wants the car to drive them around autonomously. This removes a barrier of entry for anyone who owns a Tesla, whether they have purchased FSD or not This will increase utilization and further the mission as well as make the company and the owner money.
My guess is that if you want your car to make money for you, then you will have to pay for FSD in some way. But as I said in the video, the price of FSD and Tesla's share of the robotaxi network revenue are linked - the lower FSD is, the Tesla's take rate would be higher. If FSD is free, then Tesla's take rate would be higher than the 30% I used in my model.
Once Tesla owns their own vehicles and has infrastructure set up (cleaning, parking, etc.) fleet operators will pay Tesla to run their vehicle and they won’t have to interact with the vehicles. This will be easier and more cost-effective.
It's interesting to see that shareholders look at the problem with misaligned incentives w.r.t. the well-being of people and nature. Tesla will imo produce busses with 6, 12, 24, 48 seats to minimize the energy/person-mile.
Why would someone spend 2x as much time getting to their destination because they have to go a circuitous route and stop to pick up other people? Especially if the cost per mile for a robotaxi is so cheap.
City buses currently produce more carbon emissions per passenger per mile than one person in an EV.
A robotaxi van or small bus could be interesting in some markets/situations.
@juliahello6673 the cost per mile on a bus would be smaller than the cost per mile in a robotaxi, that is already quite obvious and secondly with a dense network of robo buses you can go point-to-point without stops because of the high number of people using them. When the constraints on the system change the solution space changes within.
Go stand at a random intersection and see how many people get in or out of their cars at that intersection, or within a one block radius in the course of 30 minutes. If the intersection is in a busy part of a city, you would probably find a lot. If it is in a residential area, where people live, I doubt whether you would see more than a few, probably zero. @@tiwiatg2186
I‘d take Uber as a starting point. The uber driver is not just driving the car ,he‘s also watching over the eventualities. If he‘s relieved of the driving task, he can serve more cars than one. so, the human effort per car will gradually drop to zero over time. since about 75% of the uber fare goes to the driver, robotaxi could be worth 3x uber as the service expands.
75% goes to the driver???🤣🤣 you’re hilarious. You mean Uber takes 75%.. you people have no idea how Uber treats their drivers at all. I hope robotaxi knocks Uber and Lyft to bankruptcy from the first month of launch. I’m buying 5 Tesla on a loan and prying them all on the road 24/7. Hopefully each car can make 20k-30k a year for me I’ll be fine.
Robo Hotels by the minute
The world's oldest profession will no doubt figure out how to optimize this opportunity. Although, with cameras inside the vehicle it might me more like OnlyFares?
Other than the Tesla's stated mission to transition to sustainable transportation, has it been said that common people that own 1 tesla will be allowed to use it for RT? That might be more risk if Tesla is insuring the car for someone that doesn't take care of the car. IE bald tires and car hidroplanes on road while in FSD taxi mode. Who's at fault then? Maybe you'll have to have every 3 months inspections to be able to be in the network.
@cernbasher great video as with your others. Thank you for the great input.
My big question here is where is the demand? Is it only in big cities? Most folks in suburbs now have cars. Will kids be allowed to hail and ride robotaxis? Don't see why not, if they are allowed to use public transport.
Parents can supervise them through the camera
People always "vote with their wallet" - if the cost of using a robotaxi becomes cheaper than owning/operating your own vehicle then many people would ditch their car.
Using software model. Pls run a scenarios where Ford/other buys into network with TeslaFSD/Ford vehicle included.... As the world market demand can't be met for many years by Tesla alone... Network effect is the most valuable part of this. Vehicle type is not important to capture greatest value and mkt share. Automakers have no choice.
Question for Cern: have you accounted for the regulatory risk that even if Tesla proves FSD WORK, general people ignorance and perception will result in political pressure to NOT allow robotaxis? This pressure can be exercised by MANY people in the US, starting with mass transit public entities, and local government opposition. Look at what happened to WAYMO and Cruise in the Bay Area. Can you comment?
I have talked to several politicians - and they get it. They want safer roads. They want reduced deaths. They want less traffic. They want economic development in their city/region/state. Also, insurance companies want less accidents/deaths so they can reduce the amount they payout in damages/claims. Insurance companies and medical providers are natural allies in the effort to go autonomous.
Where's the demand curve? The calculations are 95% supply focused with a flat demand assumption. If you live in the suburbs where most peeps have cars, there's less demand for taxi service than in cities. Wouldn't everybody just jump on this opportunity and flood market with Robotaxis? Can someone show me where in this presentation, demand is discussed other than 30 seconds on fixed idle car time number? Let's say there are 50 Teslas online in my town, yet only 5 people are looking for service and 10 people are looking for delivery services... that means ALOT of Teslas sitting idle AND price per mile will, by definition, be driven down (Supply and Demand Curves in a functioning market intersect). Why would Dominoes Pizza higher drivers when they could buy a fleet of cars for pizza delivery AND deliver passengers with their fleet during daytime when pizza sales are slower? There are only so many finite people wanting rides. Everything here is a linear supply side discussion - sure thy will print money with this fixed demand assumption model. Yes, there will be a mad dash to buy Teslas (56 min mark) and print money... Well, economics tells us that the market will always level out if there is a glut on the supply side.
This person has a point!
Actually, my assumption on demand is that it will increase. Drive the price lower on almost everything and you get more demand for it - certainly true for transportation. As the cost of taking a robotaxi ride drops, many people with decide to sell their vehicles and just use transportation as a service - increasing demand for robotaxi.
Think about car to human ratio. More humans than cars. Also, most ppl won't want to even get their licence in the future when they can just get dirt cheap transportation.
@@nenproductions4395 Yes, I think you're right. Most of us don't get a pilot's license or a commercial drivers license. If transportation as a service is cheap and efficient, there's no reason to buy a vehicle and no reason to get a license to operate one. Money and time saved!
It's a good point, but as someone else mentioned if you can offer rides at 30c a mile, you increase demand from people who would have taken public transport, purchased their own car, etc
Insurance cost will drop as robo taxis take over and car accidents become a thing of the past. Probably will hover around 10% of what they are today if i were to guess. (Theft/weather)
Autonomous is not guaranteed to be free for FSD vehicles!
Tesla could self insure
How did you calculate the vehicle and battery life of 600k miles? This is not the case today. There are no OEM's that would warranty the vehicle to 600k miles especially the battery. This is a crucial to your model. My suggestion is to drop the miles to 200k.
LFP batteries have a theoretical life cycle of 1,000,000 or more.
Tesla Only should show a significant operation cost change as their fleet is significantly larger so its costs should be significantly lower, no?
These models always assume very high demand for a 1.5 USD per mile robotaxi service. If i travel 6000 miles per year, that would be 750 usd per month. A lot of people would fair cheaper driving their own car without the hassle of waiting for a robotaxis. Of course it could be more convenient etc, but price will have to come down a lot.
See this is why I'm down -25% this year. I'm super heavy in TSLA based on FSD and Humanoid opportunities. 😅
I am betting on it but I would divide Herberts dreams by 10…. Even then we will probably do great…
@@jonathannumer5415 that's a good a probability. Lolv
If you drive a tank.... lol!
what if two customers want the taxi to pick up groceries and one customer wants to ride along to grocery shop personally?
once a trip needs a driver; there would have to be lots more expense and charge. AI could figure out the charges. each trip would have to also involve a central business charging
place of business, charging spot, person running the business for the phone and organizing the trips, AI would really help in a busy business there. However, if the business is tiny...
like one person; then that person might as well ride along in the vehicle and be ready to receive phone calls and the customers should have prepaid gift cards, agreements with the
businesses, advertising, cellphone service (lots of places don't have cellphone service), what do you do if a customer decides to ruin the car in the process of trying to get away with
a zero cost ride. prepayment for the ride would be necessary. credit card payment would be necessary.
No problem. In that case, it might not be a shared trip, but I suppose it could be. To the extent that trips are shared by multiple people, the cost of the trips would be greatly reduced (on a per person basis).
I think Herbert is great. Having said that, I think the emphasis and focus on modeling is not actually very important. Even if they will not fully admit it - the real issue for analysts is they don’t really think Tesla will solve FSD anytime soon. Until that becomes a more concrete reality - it might as well be the financial modeling of how unicorns will fly people around (as far as stock analysts are concerned)
Once FSD is accepted as a real working successful product that can deploy taxis at scale within a 12-18 month horizon, then I think stock analysts will quickly accept these kinds of models, until then - they don’t level get to this.
Retail already largely knows and accepts all of this as a real eventuality. So it’s a lot of preaching to the choir.
The only thing that really matters is how soon does FSD get good enough to deploy taxis at scale, when that becomes a reality the stock will move violently. Until then don’t expect much along the FSD line of valuation.
It is a useful exercise and not everyone is aware of everything we discussed - just see the other comments. Can unicorns fly? If so, I'd better factor that into my models...
@@CernBasher Again - I'm speaking in terms of analyst perspective. I personally think FSD will happen and is real, and that unicorns aren't, but my retail wallet isn't moving the stock price. I respect the work you are doing, and Herbert is great. I just think that there are a lot of Wallstreet analysts that effectively treat FSD as a mythical unicorn. I don't think they are correct. But they influence a ton of money movement. Until FSD becomes more clearly defined to them as entering a fully solved state, I don't think the financial modeling will matter. I don't think the problem is that big money just cannot envision how to financially model FSD once it is real. I think they seriously question whether or not Tesla will get ther, and that is the big hurdle. Once they have the "AH-HA" moment, the stock will move violently as these financial models I think will be fairly obvious to them.
@@tomb4140 Agreed. But I'm not doing this for the benefit of Wall Street. It's true that Robotaxi is a mythical unicorn right now. I'm trying to look down the road a bit - beyond the timeline of most Wall Street analysts/portfolio managers - and attempting to help individual investors understand this opportunity. We've seen how such game changing technology slowly gains awareness - think iPhone or Nvidia's AI chips - this will be no different no matter how pretty my charts are.
@ $50. per month and 5 million cars extrapolate that out. Play with the numbers it's crazy.
It will be a pleasure to see a large percentage of domestic airtravel fall to tesla
An extended family of parents, children, non driving grandparents owning 1 car could to serve them all each going to their own detestations during the day, and it could still be used by trusted friends when not in use by the family.
If i robotaxi my tesla, what happens with interior damage; stains, tears, garbage left by customers, smokers?
was thinking the same, vomit, spit or any other bodily fluid.............. Who has to clean it ? can you charge the rider for cleaning fee ?
There will have to be some kind of mechanism for dealing with this. With a camera in the vehicle that will help at least to identify the offender. (Certainly the next rider would notice and report it, but that's less than ideal) From there the offender could be charged for the cost of the cleaning.
Could Tesla have tiered pricing? Less for indiviuals and more for commercial, Grandma needs FSD but she wont pay $500. and most people cant afford that.
Surge time pricing. Time of day would make sense. Unlimited non-prime time pass
My guess there will be churches and non-profits that offer free rides. You will also see medical and services offer free/low cost rides.
There will be a good percentage of families that own a Tesla car where the spouse will not want the car to be used by the public. These owners will not pay $500 /month . There should be a different FSD price for non robotaxi owners.
What about the robo network software that directs the vehicle to the next pick up, obviously Tesla has to operate it.
Tesla most certainly has to develop the necessary AI-powered software to run the robotaxi network.
$1/mile for avg driver of 12000 mi per year means if you replaced personal vehicle with robotaxi it would got 12 grand a year minimum without idle and base fees. People will not use the service for 100% of their driving unless cost is lower. 100M cars at 350 mi per day means youd be driving a Billion people 12000 miles per year. You wont find 1B people who can afford 12k per year for transportation.
If Tesla licenses FSD to other automakers your appreciating asset has just lost its appreciation. The market would be glutted.
Unless if the license exclude robotaxi feature
Herbert, you need to look at the global market and not just the US, Europe, and China. It may take 10 or more years before Tesla builds enough Robotaxi vehicles to cover the transportation needs for all of North America, China, and Europe. During this time, Tesla needs to be selling EVs to South America, Central America, Africa and the rest of Asia and India. Tesla doesn’t want to ignore these parts of the planet and condemn to buy ICE cars for the next 10 or 15 years until Tesla is ready deploy Robotaxis to these markets. If anything, Tesla needs the real world driving data and the charging infrastructure before they can deploy Robotaxis in these markets.
When tesla stops selling cars and just makes robotaxi's... the car interior can be completely configured for just passengers
Yes, and optimized for easy cleaning!