ORIGINALLY RECORDED IN DECEMBER OF 2022
In this video we walk through a thought exercise exploring the revenues that Tesla could generate from FSD based on purely personal use without ever being granted regulatory approval for robotaxis.
Link to view only model: https://docs.google.com/spreadsheets/d/1l4FrfpMFeCDon_CB2EyAOLsSCyY6Vh_Xb21nOtUsfYU/edit?usp=sharing
X Thread: https://x.com/HansCNelson/status/1599789359896502272?s=20
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Nice thesis, Hans.
Good stuff!
Great analysis. My gut reaction to this is that this model is–as you rightfully said–great for modeling the time between now and when Robotaxi enters the scene. Around five years from now exists an event horizon which is difficult to model beyond, mainly because modeling Robotaxi financials is very difficult.
By 2027, I expect Robotaxi to start making a fundamental shift in Tesla's business model, and we really just don't know what Tesla's approach is going to be when the world shifts to autonomous transport. For example, Tesla could shift from being a direct-to-consumer auto company to being a business-to-business model, in which their revenues large come from selling direct to transportation service businesses.
What I do know is that Tesla's speed and adaptability allows them to make moves much faster than other players, and so if anyone can rapidly adapt to whatever the environment looks like at the time, it will be Tesla. When Elon said–I believe at the Q3 earnings call?–that he sees a path forward (albeit difficult) for Tesla to 10X again, I kind of think he might be underselling it so he doesn't get fingers pointed at him if that doesn't happen.
Won't make any difference, it's unaffordable now and that won't change
Hans. So hot right now.
Spot on. 🔮
The system should be provided free when it works without the need for insurance. Revenue can be attached to commercial use of robotaxi only with all public robotaxi use considered commercial as opposed to owner's use by a family
Very interesting!
Haha, good call on this!
Outside tesla no one understands fsd
If Tesla can't get to level 4 before your timeline, we're in trouble by Elons calculation, he said today on Peter Diamandis podcast that AI training compute is 10 x ing every 6 months, ie it will 100 x in the next year if level 4 self driving isn't child's play by early next year, any moat that Tesla still has will be evaporating exponentially. Elon said this is the Exponential of all exponetials.
Good analysis.
How will this affect the training data collected? Will Tesla be using driving data from all the free trial participants to train FSD, now that they are not compute constrained (please forgive me if compute constraint is irrelevant here lol)? Seems like having such a massive variation is location, and just large number of new data could be pretty important & helpful in training
Good stuff! Please note that many people listen while driving (in Europe without FSD) 🤣, they are not able to read the poll results …
@Hans, my guts reaction is that there is no way all the Tesla owners by percentage can finance this model.
Will China even allow an American country to have FSD in their country?
Great call 👏👏👏
Major cudos bro. Had your crystal ball out for this.
Morning mate
I think Gary and James the cat are starting to sideline their egos and see the forest. I've been thinking for the longest Ford would be the first to license it in some form as they seem to take the space seriously. Love Elon's recent email that "all test drives must first have an FSD demo." 👀🤯
Damn I plugged in my assumptions, adjusting 2024 deliveries to 2.2mil, lowered growth % each year until 2026/7 when new model is ramped, lowered take rate start to 10%, then bigger jump in 2026 once people actually know it’s good. And some other tweaks and I must be extremely conservative cause it was down to $40.63 😅.
Made me wonder why I’m still buying at $170/share 😂
Would be cool to run an updated FSD poll and then re-run the data in your spreadsheet.
Amazing call! Well done.
I’m only interested in level 4 – I don’t drive enough right now to justify spending $1,000 per year on sub level 4. Honestly I might not even buy level 4 for 1,000.
I guess I'm in this group's minority with my quickly advancing age that is now beginning to infringe on my ability to drive a car safely. As my reflexes begin to get slower, I look at scenarios that in the past it would almost be "muscle memory" to deal with that now are beginning to actually require thinking to address (which, when driving, there is scant time for). When younger I barely realized that this would be a thing but now FSD cannot come fast enough for me. Having a vehicle that can do the work of carrying me around by itself will become so important for maintaining my mobility. Without it I can see the time approaching that I'll need to turn in my keys. All of us eventually will reach the point where this becomes necessary. I hope your predictions play out as you envision. It sure looks to me like we are getting there pretty soon!
Tesla should give FSD discount to people who have been supporting the company with vehicle purchase & holding 500+ T$LA for more than 5 years.
Unfortunately, within days of using FSD V12.3 I had to takeover just 1sec before it was going to crash into another car. The other car would have been at fault, but FSD did not see the accident about to occur thus requiring me to slam the brakes to avoid it. FSD is good, but not for people thinking it’s perfect. I hope this does not open Tesla to tragic accidents caused by overconfidence.
Thanks. Great video. Love the fact you get to repost in now.
Too complicated, Tesla will simplify it with one price
Yes! Seems pretty clear to me that there should be 3 tiers of FSD: Safety FSD, Chauffeur FSD, and RoboTaxi FSD. Safety FSD comes with the car, as AutoPilot does, because FSD is a huge safety feature and will save lives. It's not right to charge for something that has the potential to save lives; what if a person can't afford FSD and that person or someone else dies because they couldn't afford FSD. Other carmakers charge extra for non-mandated safety features, not Tesla. You must sit in the driver's seat and keep your eyes on the road (no reading books or farting around with your phone) or else FSD will disengage. If you want to sit in the back seat, there's a monthly/annual fee for Chauffeur FSD (but free for those above 80). And if you want to make money from RoboTaxi FSD, that costs more than Chauffeur FSD.
The major catalyst is insurance prices falling. People will have more safety, cheaper prices, great features with no competition.
Everybody who wants it has already bought FSD. Max 10% or 50k/year customers (in US). And there are returning customers. And $15k is one shot Willy, not recurring revenue. So nowhere near even $1 Billion/year. This is at the moment less than $500 Million/year revenue. Not to mention, that SaaS is NEVER pure profit. Far from it.
if you run a poll give us the weighted average price based on the votes. that is the most representative data point that gives you a means to compare all the results instead of percentage points next to an arbitrary number which doesnt really tell a story until you dig deeper into the numbers. just a thought. thanks for sharing this.
Thanks Hans. Absolutely love your content. Great, smart, balanced coverage ❤️👌🙏