san francisco Tesla boss Elon Musk predicts that fully autonomous driving will become a reality by the end of the year. “I think we’re going to be better than humans by the end of the year,” Musk said Wednesday at the company’s earnings release.
“Each self-driving car will be worth about five times what it is today,” Musk said. Cars are currently only used around ten hours a week on average. Thanks to self-driving systems, cars could be used much better.
In the future, a car will be comparable to a house and Airbnb. An owner can either use it completely himself, partly with other parts or completely make it available to others in order to earn more money. “The value is just tremendous,” Musk said.
“It makes sense to sacrifice profit margins in favor of producing more vehicles,” Musk said. Thanks to the development of self-driving systems, the world of Tesla vehicles will be significantly higher in the future. $15,000 for an autopilot upgrade is a steal compared to the utility of the systems, Musk said.
Musk repeatedly reiterated that autonomous driving systems would be better than humans by the end of the year. He had made similar forecasts several times in the past, but was always wrong. “I’ve been wrong in the past, maybe I’m wrong this time, too,” he said.
The reason for his optimism is the start of production of the Dojo computer chip. So far, Tesla has used Nvidia for chips. However, the self-developed Dojo chips are tailored to the needs of Tesla. “Dojo is optimized for evaluating video data,” Musk said. Tesla will spend more than $1 billion on Dojo next year. “We have a truly staggering amount of video data to train on,” Musk said.
The carmaker has published its quarterly figures.
(Photo: AP)
In addition, Tesla will benefit from the AI company xAI, recently founded by Musk. The company is able to attract the best AI researchers that Tesla could not have attracted on its own. “I think xAI will have some value for Tesla,” Musk said without elaborating.
In May, the Handelsblatt reported in several articles about 100 gigabytes of data that informants had leaked. In total, the Tesla files comprised 23,000 files. These suggested that Tesla could have significantly bigger problems with the autopilot than previously thought.
The data includes more than 2,400 self-acceleration complaints and more than 1,500 braking function problems, including 139 cases of unintentional emergency braking and 383 reported phantom stops resulting from false collision warnings. The number of crashes is more than 1000.
Tesla achieves record sales
Musk was able to announce a record for the past quarter. With 24.9 billion dollars, the company had achieved the highest turnover in the company’s history. However, the price reductions initiated by Tesla narrowed the margin. Profitability (gross margin) declined to 18.2 percent from 19.3 percent in the previous quarter. That’s the lowest reading in 16 quarters. Net income was $3.15 billion.
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Christian Koenig observed that Musk made two key announcements in the direction of Volkswagen, BMW and Mercedes. The car expert has worked for Porsche in North America and runs an electromobility consultancy in Atlanta. The competitive prices would not initially be given up. At the same time, production at the Tesla plant near Berlin will be doubled to one million vehicles a year. “This is a double declaration of war on the German car manufacturers,” said Koenig.
Musk told analysts on Wednesday that he was worried about rising debts from credit card customers. “We just don’t have control over market conditions,” Musk said. “If market conditions are stable, I think prices will also remain stable. If they are not stable, we will have lower prices,” Musk said.
Fighting prices are likely to continue
Analysts expect Tesla to maintain its aggressive pricing policy well into next year unless external factors intervene. A few days ago, Tesla reached an agreement with leading Chinese electric car manufacturers that is intended to end the ruinous price competition in China.
Sixteen companies including BYD, Geely, Nio and Xpeng signed a memorandum of understanding to maintain “fair competition” and avoid “abnormal” prices. However, the group did not take this step entirely voluntarily – Beijing had previously put pressure on the industry association CAAM.
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In North America, Tesla was recently able to make a name for itself with positive headlines about its supercharger charging network and its own NCAS charging standard. Within a few weeks, Ford, GM, Rivian, Volvo, VW and Mercedes-Benz announced their intention to use the Tesla charging network in North America and to support the Tesla standard.
However, the good news and the strong share price development in 2023 should not hide the fact that the group faces numerous challenges.
Tesla’s model range is no longer fresh: the latest model is the Model Y, which was launched in 2020. A facelift is expected for the Model 3. The mid-size models Model 3 and Model Y currently account for around 96 percent of Tesla’s global sales. The outdated upper class models Model S and Model X now only play a minor role in sales. The long-awaited Cybertruck is not expected to be delivered in large numbers until 2024. Most recently, in China, Tesla’s second most important market, BYD had risen to become the largest manufacturer of electric cars, overtaking Tesla.
Musk made no specific announcements about the Cybertruck. “We continue to build release candidates of the Cybertruck on our final production line in Austin,” Musk said. “It’s always difficult to predict the ramp-up phase, but I think we’ll mass-produce them next year and deliver the car later this year,” the Tesla CEO said.
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