I was on a youtube panel discussion with Herbert Ong, Jeff Lutz and Xander Sky. We were talking yesterday about the major Tesla deal with Baidu for FSD mapping and for the various China approvals that put Tesla on the brink of being fully authorized to sell FSD in China.
Current Tesla stock analysts blend FSD and autopilot software sales into Automobile revenue and profits. This is fine if software sales are steady and at a low level relative to auto revenue. Tesla FSD sales are equal to full profits of a full car. Tesla makes $7,000 $8,000 profit per car right. If you buy FSD straight at $8000 that is more than the profit of a car. If you buy a FSD subscription that is $1,200 per year. In six years this would be the profit of a car.
China was blocking Tesla from selling FSD. China has the most wealthy people for buying luxury goods of any kind. Over half of the sales of luxury LV bags and jewelry are in China. The wealthy people are the ones who have bought Tesla cars in China. A full release of FSD could see 300,000 sales of FSD or FSD subscriptions in China in a few months.
The economics are terrible if you’re buying all your own vehicles for ridesharing network and are also not good for robotaxi network. It is better to have only some company owned robotaxi and use customer cars like Uber in more situations.
$TSLA FSD: How It Stacks Up Against Chinese Rivals
Will a potential deal reshape the self-driving landscape for Tesla and other Chinese automakers?@nextbigfuture @thejefflutz @R6Alex pic.twitter.com/C2pqJWxopV
— Herbert Ong (@herbertong) April 30, 2024
Every 21,000 FSD sales is an additional 1% on gross margin. $250 million is 1% margin. If Tesla had 200,000 subscriptions that is 1% on on margin in the year but that’s incremental each year. They get another 1% next year if they didn’t cancel out.
Tesla in China with FSD is huge for Tesla profits and improvement of the AI software. There will also be a doubling of the driving data.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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Two days now, after Tesla’s disastrous announcement of them decimating the charging network and effectively destroying EV adoption momentum (and alleviating range anxiety) not just for themselves, but everyone else. No article? No condemnation? Crickets?
I have a video which I just recorded where I discuss Tesla supercharging with Warren Redlich, Being edited up tomorrow morning. Spoiler, staffing changes does not wreck supercharging. It is a two year move to allocate more resources to AI. There will be no need to add any supercharging capacity for a lot of non-Tesla for at least 3 years. Warren describes simple management of Supercharging to handle the growth over the next two years. Then there will be a pivot to different charging. Explained in the video.