Thursday 20 October 2016

Better Than “Tuber”: Musk’s Ride-Sharing Bid is Called “The Tesla Network”

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2015 Tesla Model S P85D

With all the hubbub about the new eight-camera “Hardware 2” system announced late yesterday, most of the Tesla discussion has been around the capacity for an improved self-driving experience built into every automobile constructed at the the company’s Fremont factory from October 19 forward. But buried at the bottom of the company’s updated Autopilot information page is an interesting nugget, one that offers a hints about Tesla’s future ridesharing venture.

“Please note that Self-Driving functionality is dependent upon extensive software validation and regulatory approval, which may vary widely by jurisdiction. It is not possible to know exactly when each element of the functionality described above will be available, as this is highly dependent on local regulatory approval. Please note also that using a self-driving Tesla for car sharing and ride hailing for friends and family is fine, but doing so for revenue purposes will only be permissible on the Tesla Network, details of which will be released next year.

Does this mean that a Tesla with autonomous capability can’t be used for Uber or Lyft service? In his announcement of Master Plan, Part Deux back in July, Musk noted that ride sharing via a Tesla-owned service was in the company’s future, suggesting that owners potentially would be able to negate their car payments by lending out their Tesla when they don’t need it. It makes sense that for insurance purposes, Lyft and Uber might not want autonomous cars not directly under their control ferrying passengers on their networks. But for Tesla to forbid its cars’ use by presumed competitors seems like the sort of Muskian reach that bolsters the spirit of the Tesla faithful and leads the rest of the world to deride the brand’s partisans as smug cultists.

As we noted yesterday, Elon hopes to have a Tesla run a reverse Cannonball with the driver in a purely supervisory role for the entire distance—including during charging—by late next year. Most of the LA-to-New York run is on Interstate highways and isn’t particularly challenging. The most interesting piece of that particular puzzle is that Musk claimed the car would handle its own charging, then park itself after dropping the driver in Times Square. With those two pieces of the puzzle together, all that stands between a fleet of privately owned Teslas that can be hailed and reality is some software development, willing owners, and—most dauntingly—government regulation.



Take lawmakers; insurance-company shenanigans; and pressure from Uber, Lyft, and the taxi lobby out of the equation; and giving people a cheap-as-free car with a premium badge actually doesn’t sound like a Hail Mary plan. Or at least not nearly to the degree that launching a company attempting to change the auto industry on the back of a repowered electric Lotus Elise seemed 10 years ago.

Still, Musk gets people to front the money for the cars, other Tesla Network members pay the owners for use of the cars, Musk builds more cars, because people like a great deal on a product with legit status. And because it’s Musk’s plan, the Tesla faithful will lap it up. Cadillac’s Johan de Nysschen would kill for a line of people more than stoked to pay full price for a CTS. With the Tesla Network, Musk has apparently pre-emptively locked Uber and Lyft out of hijacking his tech (though the means of enforcement remain to be seen), and found a way to get his cars into more hands by giving a discount. Furthermore it’s a discount that only bolsters his own bottom line. Now he just has to figure out how to build more cars.

Whether The Tesla Network is a Muskian feint like the battery-swap boondoggle remains to be seen, but whatever you say about the man, he’s never been one to shy from an uphill battle. We’ll be very curious to see how it plays out.

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