Tesla (TSLA) Could Lead $ 1.2 Trillion Market With Uber-Like Autonomous Vehicle Fleet


Tesla (TSLA) envisions a more than decent slice of a market valued at $ 1.2 trillion with its upcoming Tesla Network, a new Uber-style ridesharing service with self-driving electric cars, according to Ark Invest.

For years, Tesla has taunted a ridesharing app to be powered by its autonomous driving system. It has been nicknamed the “Tesla Network”.

The new product depends on Tesla’s computer vision resolution to deploy its complete autonomous driving system.

In case that happens, which CEO Elon Musk has claimed this year, investors have tried to assess the hugely disruptive new product.

Ark Invest, a Tesla shareholder, attempted to quantify the potential value of such a service in its Big Ideas 2021 report.

The group estimates that autonomous carpooling platforms will generate more than $ 1 trillion in revenue by 2030:

Now the big question is, who is going to take the biggest share of this insanely large market?

Ark agrees with Musk that Tesla’s vision-based approach is the most scalable:

Tesla’s approach is camera-based. With less precise sensors than LiDAR, making the path
at full autonomy a more difficult problem to solve, the cameras do not rely on HD cards and should allow a much more scalable service. Tesla could be the first network of autonomous taxis to expand nationwide.

While competitors like Waymo have already launched commercial self-driving ridesharing services, they believe the approach is too difficult to scale and will limit growth:

However, Ark isn’t as optimistic as Musk when it comes to Tesla launching this service anytime soon. In the report, Ark attributes a 30% probability that Tesla will launch its autonomous VTC service in 2022.

But if that happens, Tesla will take control of the market much faster:

If Tesla successfully launches its ride-on service in 2022, Ark estimates adoption could approach 20% by 2025. If Waymo or GM is successful, adoption will likely be limited to 1% over the next five years.

The group thinks many are underestimating the impact of stand-alone appeal, which could reduce human appeal by 90% in the United States and by 50% in China.

Ark estimates a cost of 25 cents per mile to the consumer, which would significantly reduce the cost of personal transportation and expand the market.

Taking Electek

In general, I tend to agree.

With every penny per mile that you can reduce the cost of transportation, you are dramatically increasing the market, and autonomous electric vehicles would save tens of pennies per mile.

This will have an extremely disruptive impact on the entire transportation industry.

Most pundits currently view Waymo and Cruise as leaders due to their already operational stand-alone services in San Francisco and Phoenix.

Tesla isn’t too worried about this as he still believes his vision-based strategy would allow them to overtake companies that will have a much harder time expanding the service to other markets. Indeed, they require in-depth mapping and maintenance of new markets before they are launched.

But there is a lot of doubt that Tesla actually solves the vision problem.

I think Ark’s 30% probability is a safe guess for now, but that might change after we see Tesla FSD v9 in just a few weeks.

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