Tesla is valued at more than the auto industry because they are doing more than the entire auto industry.
Honda is going to come out with a new Civic next year. It's going to look like the old Civic.
Tesla is trying to create self driving taxis to make the rest of the auto industry obsolete.
If you think that can happen, they should be worth more than the rest of the industry.
> Lastly, even if they succeed, competition will catch up and the market will be saturated.
Waymo is already in the lead, and OEMs will be beating down Waymo's door to license a simplified Driver stack if L3 autonomy becomes a sales-driver (ha!)
Edit: Waymo already has strategic partnerships with Toyota and the Hyundai group, so OEMs are already further along this path than I thought
Well, check Hyundai as well. They do more than cars as well including robots(Boston Dynamics). Tesla is not doing anything special. It was the only EV someone could use but it’s no longer the case. Now it tries to go the robots way but it’s not the same as the EV was. There are tones of humanoid robot companies, some more advanced than whatever Tesla is cooking
We're missing a part of the case though: why do you need to be a car-maker to be the vanguard for self-driving taxis?
The best case scenario for a self-driving company would be to target software and sensor solution packages that they can sell or license to other manufacturers. Such a vendor can focus on the self-driving problem and not have to bother with things like "we found a surprisingly big market niche for a 11-passenger minibus, but no platform for it" or "to sell it in the EU we need the headlights to be 5cm lower". I'd expect the margins are also a hell of a lot higher if they don't have to include two tonnes of steel with each auto-driver license they sell.
Maybe they build a small number of test mules, or just chop-shop a few off-the-shelf cars as a R&D fleet, but they hardly need to be a seven-figures-per-year manufacturer to be supplying those needs.
That's even assuming they come out green in the competition to deliver robotaxis. Right now the leading player in the US market is a company who is neither Tesla nor a legacy vehicle manufacturer. It's an adtech who started gluing the contents of a Radio Shack onto the worst cars you could possibly think of (Chrysler Pacificas and Jaguar i-Paces? Really?) and turned it into something that's an everyday thing in several major cities.
Tesla FSD story reminds me of the fracas that was early OS/2. IBM sold people 286 hardware on the promise of it running OS/2, so they had to waste a lot of effort building a 286-capable OS/2 that was clunky and almost immediately obsolete. No matter how talented Tesla's R&D team are, they're walled in by design choices made on existing vehicles (i. e. relying on cameras instead of lidar). I wonder if they'd be better off being ran as an arm's length startup to address the problem more generically, and then they can sell it to other firms if it turns out that the best solution won't work on existing Tesla hardware.
> Tesla is trying to create self driving taxis to make the rest of the auto industry obsolete.
This is a pretty baffling take. Most people in the world operate their own cars, and even if taxis were free, a large portion of them would continue to operate their own cars because it's convenient.
Taxis also don't replace a good chunk of the new vehicle market. People driving fleet trucks aren't going to work out of taxis. The top selling vehicles in the USA are pickup trucks, and it isn't even close.
Lastly, even if they succeed, competition will catch up and the market will be saturated.
In 20 years, people will still be buying the humble Civic. While the next 20 years at Tesla will probably be a string of market failures and wacky promises of personal space craft or some shit.