Tesla Destroys Uber in California Price War with $1 per mile rides

Tesla's Robo Taxi Strategy

🚗 Q: What is Tesla's initial robo taxi rollout plan?
A: Tesla aims to launch in California, covering San Francisco, Oakland, and San Jose, with dynamic pricing at $1 base fare and $1 per mile.

🌆 Q: Which cities is Tesla targeting for robo taxi expansion?
A: Tesla is hiring vehicle operators in Brooklyn, Houston, Tampa, Henderson, and various Florida cities to rapidly launch ride-hailing services.

💰 Q: How does Tesla's robo taxi pricing compare to competitors?
A: Tesla's pricing is twice as cheap as Uber, with a $3 fleet fee for a 15.87-mile ride, compared to Uber's cheapest option at $8.

Financial Projections

📊 Q: What are the projected revenues for Tesla's robo taxi network?
A: Estimated revenues are $48,000 per vehicle annually at 30% utilization and $100,000 at 65% utilization.

📈 Q: What are the expected profit margins for Tesla's robo taxi business?
A: Tesla anticipates net margins of 36% with profits of $17,000-$21,000 per vehicle, depending on utilization rates.

🏦 Q: How quickly can Tesla recover the cost of a robo taxi vehicle?
A: Tesla projects returns of 50% more than the vehicle's cost in the first year of operation.

Impact on Car Ownership and Competition

🚫 Q: How might Tesla's robo taxi service affect personal car ownership?
A: The $1 per mile pricing could reduce the need for car ownership to almost zero, especially for four-seater vehicles.

🏎️ Q: What is the cost comparison between Tesla's robo taxi and car leasing?
A: Tesla's robo taxi service is projected to be cheaper than the average $600 monthly car lease.

🚕 Q: How does Tesla's robo taxi service compare to traditional taxis in efficiency?
A: Tesla's robo taxis are expected to be more efficient, capable of 80 mph on highways and 30 mph in urban areas, with less maintenance required.

Future Developments

🤖 Q: When does Tesla plan to achieve full autonomy for its robo taxi fleet?
A: Tesla aims for full autonomy by 2025, planning to remove safety drivers as soon as possible.

📱 Q: How will Tesla's Autopilot system integrate with the robo taxi service?
A: The Autopilot system will enable robo taxis to navigate complex routes and avoid obstacles, enhancing efficiency and reliability.

💼 Q: What is Tesla's strategy for fleet ownership in the robo taxi business?
A: Tesla is likely to own 60-70% of the robo taxi fleet while allowing some external ownership, as it can generate $50,000 per year per vehicle.

Pricing and Economics

🚗 Tesla's robo taxi pricing of $1 base fare plus $1 per mile with dynamic pricing is expected to be twice as cheap as Uber, potentially making car ownership nearly obsolete.

💰 At 30% utilization, Tesla's robo taxis could generate $48,000 revenue per vehicle per year, increasing to $100,000 at 65% utilization, with 50% more than the vehicle cost returned in year one.

📊 The robo taxi business model is projected to have 36% net margins and $17,000-$21,000 profit per vehicle, with cost per mile ranging from 25-60 cents depending on the model.

Market Impact and Strategy

🌆 Tesla's strategy involves launching ride-hailing in multiple cities rapidly to initiate regulatory processes, with job openings for vehicle operators of autopilot in various locations.

🔄 Tesla plans to own 60-70% of the robo taxi fleet while allowing consumer ownership, creating a mix that can pay for itself within a year.

🚀 The $1 per mile pricing could drive a requirement for 300,000 vehicles in Austin alone, demonstrating the potential scale of the service.

Implementation and Competition

👥 Initial rollout will involve fleet managers hiring and managing drivers, not individuals, until operational perfection is achieved.

🏆 The service is expected to disrupt the entire transportation industry, potentially making it impossible for Uber and Waymo to compete.

Societal Impact

🛡️ Robo taxis could revolutionize transportation, potentially reducing the 40,000 annual deaths and 2-3 million injuries in the US related to vehicle accidents.

💸 The average cost of car ownership is $10,000 per year for 10,000 miles, making Tesla's robo taxi service a more economical option for many consumers.

• 00:00 🚗 Tesla launches $1-per-mile ride-hailing service, undercutting Uber's pricing and expanding rapidly to disrupt the industry.
  • Tesla launches $1-per-mile ride-hailing service in multiple cities, undercutting Uber's pricing and rapidly expanding its presence to gain regulatory momentum.
  • Tesla has launched its robo-taxi service in California, specifically in the Bay Area, and introduced dynamic pricing, potentially setting a precedent for a US-wide rollout.
  • Tesla's $1 rides will massively disrupt Uber's business in a large geographic area with a population of 7.7 million people, likely with a limited number of cars initially.
• 02:33 🚗 Tesla is poised to disrupt and potentially destroy Uber's ride service with its rapidly expanding fleet, plans to remove human supervision, and accumulation of data to improve its Full Self-Driving capabilities.
  • Tesla's ride services are compared to Uber's, showing a size difference in vehicles used in different locations with varying regulatory requirements.
  • The number of Tesla cars for ride services will explode in a very short order, with expansion rates potentially increasing 10x.
  • Tesla will remove safety drivers or monitors as soon as possible, according to local regulations and when they feel confident in the safety of their vehicles.
  • Tesla is poised to remove human supervision from its rides, with Florida being a key test case due to its lax regulations, potentially giving it an edge over competitors like Uber.
  • Tesla isn't in a rush to get regulatory approval for its Full Self-Driving service, as it needs to accumulate more miles of data, likely half a million to a million, before the next software release.
  • Tesla likely uses the same software for Full Self-Driving in Austin and California, with the only difference being the location of the safety monitor.
• 08:37 🚗 Tesla's $1 rides undercut Uber's pricing, threatening their market share and potentially disrupting the ride-hailing industry.
  • Tesla's data shows Uber's new dynamic pricing structure effectively charges a $1 base price plus $1 per mile, making it comparable to or potentially more expensive than Tesla's own ride services.
  • Tesla's $1 rides set a low price bar, making it hard for competitors like Uber and Lyft to profit.
  • Tesla's $1 per mile ride pricing sets a new bar, potentially requiring 300,000 vehicles in Austin and threatening Uber's market share.
• 12:43 🚗 Tesla's potential $1 ride service could disrupt Uber's business model with estimated high profits from its robo-taxi network.
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  • A $1 per mile ride service would make car ownership economically unviable, with estimated costs of $10,000 per year for 10,000 miles, compared to an average car lease of $6,000 per month plus $2,800 for other costs.
  • Tesla's robo-taxi network could generate $48,000 to $100,000 per vehicle per year, with net margins around 36%, potentially disrupting Uber's business model.
• 16:50 🚗 Tesla's $1 rides threaten to put Uber out of business with significantly cheaper robo-taxi service.
  • Tesla's $1 rides, facilitated by removing safety drivers, make its robo-taxi service significantly cheaper than Uber's, with an example ride costing $3 versus Uber's $8.
  • Tesla's $1 ride offer would put Uber out of business since it costs Uber more than $1 per mile to operate, with an average revenue of $4 per mile nationwide.
  • Uber rides at night can be significantly more expensive, with estimated increases of 20-100% more than standard rates, depending on the service type.
• 20:01 🚗 Tesla plans to launch a $1 ride service, posing a significant threat to Uber with potential autonomous drivers.
  • Tesla is hiring autopilot vehicle operators in multiple US cities, suggesting potential expansion of its services, including a surprising entry into New York.
  • Tesla can quickly roll out a $1 ride service using their existing infrastructure and potentially even autonomous drivers, posing a significant threat to Uber.
  • Something happening would be bad for people.
• 23:51 🚗 Tesla's $1 robo-taxi rides will destroy Uber and surge Tesla's stock price, as federal approval would set industry rules and validate its safer autonomous vehicle tech.
  • Tesla's stock price will surge significantly, likely by $100 or more, the moment it removes the safety driver from its first robo-taxi, changing public and investor perceptions.
  • Tesla's $1 rides will significantly impact Uber, causing Tesla's stock price to jump due to increased institutional investor buying.
  • Tesla is strategically aiming to get federal government approval for its robot taxi service, which would then set industry-wide rules, and highlighting the double standard in media coverage of Tesla versus competitors like Waymo.
  • Autonomous vehicles will inevitably have accidents, but what matters is whether they are safer and have fewer accidents than human-driven vehicles.
  • Tesla's Full Self-Driving (FSD) technology is significantly safer than human driving and will eventually surpass current limitations to become even safer.
  • Autonomous vehicles will cause a huge decline in deaths and injuries, with 40,000 annual fatalities expected to peak and then decline in the next couple of years.
• 31:52 🚗 Tesla investor resource website launched at herbertong.com.

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