I know, I know. I’ve been writing about Tesla an awful lot lately. I promise and unless something interesting comes up, this will be the last time I do so for a bit.
First off, I’ve mentioned before that it seems Elon Musk and the Tesla company are one of those love ’em or hate ’em propositions. There are those who are absolutely enamored with both the man and his company, just as there are those who hate, hate, hate both. There are also a few, granted, who may love or at least be curious of the product but aren’t thrilled with Mr. Musk and his personality.
I’m basically somewhere there. I think the hatred directed at Mr. Musk is overblown even though I do believe he should tamper down some of the tweets (he’s nowhere near the obnoxious level of Donald Trump, though). As an owner of a Tesla Model 3, I’m also firmly in the camp of “love” with regard to the product.
After posting yesterday’s thoughts on Tesla’s losses, I found myself thinking about not only the company, but the future of cars in general. As I was thinking about that, something occurred to me and I figured I’d present it for what it’s worth, and all due apologies to a certain highly anticipated Marvel movie opening this week.
Tesla, and Mr. Musk’s, Endgame
In a nutshell: The self-driving feature.
As the cliched expression goes, car companies, and the public at large, are playing checkers while Mr. Musk is playing three-dimensional chess.
To be very blunt, when Tesla perfects the self-driving feature, I think its going to be game over for the auto industry as we know it and, just maybe, Tesla will become the one and only car company.
How about this: I suspect Mr. Musk and Tesla’s goal is to eliminate the need for people to buy and own cars, period. At least in all medium to large cities.
Sounds… paradoxical? Perhaps nutty?
A car company that wants to eliminate the need for people to buy cars?
Envision this: If the self-driving feature is perfected and used exclusively in Tesla vehicles, then the company can create its own version of Uber/Lyft, with electric vehicles moving about in big cities picking people up and dropping them off wherever they need to go, then picking them up later on to return them to their home.
Because we’re dealing with an electric self-driving vehicle, we already cut two major bills down: The need for a driver and the need to pay for gas. Therefore, Uber/Lyft will be undercut, price-wise, and we know people who use either service will go to the cheaper self-driving Tesla vehicles.
But wait, there’s more!
With prices so low to be picked up and driven to wherever you need to go, why bother buying your own pricey vehicle? Why bother paying insurance on said vehicle?
Oh, and by the way, did you notice the news that Tesla plans to create their own insurance? (read about it here)
I think not.
What Musk is doing with Tesla is essentially the same thing Steve Jobs did with Apple: Create a self-contained system, only in this case for vehicles.
Let’s return to the scenario I presented above:
You’re a youngish person who lives in an apartment/house and pays your rent/mortgage. You may be single, you may be married. You may have kids.
You’ve got bills and, at least now, one of them is a car. You buy/lease a car, you have to pay for gas, oil changes, general maintenance, and insurance. In the mornings, you and/or your spouse rush out to work. Or feed the kids and get them to the bus. Or rush out a little earlier to drive the kids to school before you go to work.
Now picture a future with Tesla’s self-driving cars roaming around your city.
You wake up not quite as frenzied. You get yourself/your spouse/the kids up and ready. You reach for the Tesla app and call a vehicle to come pick up and take your kids to school. You then us that same Tesla app to call another vehicle to take you/your spouse to work.
The cost to use the Tesla self-driving vehicle services wind up being less per month compared to paying your lease/loan on your vehicle along with the maintenance and gas. You’re no longer as rushed.
As you take the ride to work, you read a book or listen to music or read the latest news and don’t have to worry about focusing on your drive.
You get to work. Your kids get to school, the Tesla self-driving vehicle is on its way to the next client it needs to pick up. Or, if its battery is low, it heads to the Tesla center to get re-charged and, afterwards, is once again on the streets getting new clients.
By the end of the day, your kids can summon a Tesla self-driving vehicle to take them back home. At the end of the work-day, you can summon your own car to take you to work.
On weekends, you can summon a Tesla self-driving vehicle to take you to the mall. Or perhaps the beach. Or to the grocery store. When you’re done, you summon another Tesla self-driving vehicle to take you back home.
The costs, again, are far less to use this service than buying a car. They’re far less than using Uber/Lyft. And there’s little hassle. The cars on the road are increasingly/exclusively Tesla vehicles (though there will be “real” drivers out there, at least for a few years upon implementation of this system).
And Tesla will make buckets and buckets of money without having to sell even a single one of their vehicles.
Does that sound possible? Does that sound likely?
Perhaps not in the next couple of years, but how about five years from now? Ten years?
Is this indeed Tesla’s Endgame?