Tesla is all the rage. Uber is all the rage. Tesla + Uber multiplied by 500,000 and with self-driving technology thrown in? Yeah, Uber CEO Travis Kalanick knew that would have the automotive media world exploding like Diet Coke after a taste of Mentos. So, he dropped the chill comment that Uber would buy 500,000 self-driving cars from Tesla within the next 5 years if Tesla could produce them.
Fun? Yeah. But there are a few issues here that make my own little skull want to explode. First of all, Tesla’s not going to have 100% self-driving cars for sale within the next 5 years. No one is. Even if they could produce them at a reasonable cost and without technical issues, the legal system simply isn’t going to move fast enough to support that. But anyway, there are a host of barriers to such vehicles hitting the roads, so let’s not even pretend.
Assuming Travis is fine with 80–90% self-driving cars (or whatever Tesla can muster), Tesla obviously isn’t going to sell all of its cars to Uber. There’s a long waiting list for Tesla vehicles (something like 24,000 reservations for the Model X, and let’s not even think what Model 3 reservations are going to look like). And Tesla wants consumers around the world to drive these things, as word of mouth is the best advertising out there. The biggest draw of a Tesla is driving it, not being driven in it. Plus, you know, there’s that whole “don’t put all your eggs…” thing.
Thirdly, you know, Uber would actually have to scrounge up the money for 500,000 self-driving Teslas. Assuming $100,000 for a car, that would be $50 billion. $50 billion….
But hey, it’s a great endorsement for Tesla. The head of one of the hottest tech- or auto-related companies out there just said he’d place an order for 500,000 of your vehicles. More free advertising for Tesla (and for Uber). And before the jealous Tesla haters among you start bashing Elon Musk and crew for the free advertising and fan enthusiasm, hey, remember, Tesla’s done a bit to deserve it.