Tesla & Robotaxi Economics: The Network That Optimizes The Machine

There is a long-standing argument about whether Tesla is a car company or a tech company. This argument is typically made in the context of how Wall Street should value the company. If Tesla is just a new kind of carmaker, it should be valued at something significantly less than its annual revenue — maybe 25% to 50%, like Ford and GM. Alternatively, if Tesla is a tech company, then it could be valued significantly higher. Google, for example, is trading at about 6 times its revenues today, Facebook at 8, Microsoft at 9, and Salesforce at 10 times. Tesla trades at around 3 times its revenues with some profits, while Uber and Lyft trade around 4 times revenues and have never been profitable.

Why Today’s Leading Automakers Should Fear Tesla

The purpose of this article is to challenge the narrative that is commonly heard on mainstream news sites that Tesla has sold a few cars to a few people who just care about the climate, but that Tesla doesn’t know what it is doing. The second part of that is often that Tesla’s leader, Elon Musk, is a great fraud, someone who can get his faithful excited but never delivers on his promises.