Tesla: FSD Reveals Opportunity, But Mania Makes Tesla Too Expensive

Tesla: FSD Reveals Opportunity, But Mania Makes Tesla Too Expensive

Jul. 10, 2023 10:42 AM ET Tesla, Inc. (TSLA) PYPL , RACE

Introduction

Tesla (TSLA) is a leading electric vehicle manufacturer. The company is also developing autonomous driving technology, which it calls Full Self-Driving (FSD).

FSD is a software suite that allows Tesla vehicles to drive themselves on city streets and highways. The software is still under development, but it has already learned to perform a number of autonomous driving tasks, such as changing lanes, navigating traffic, and parking.

The potential of FSD is significant. If Tesla is able to achieve Level 5 autonomy, its vehicles will be able to drive themselves without any human input. This would revolutionize the transportation industry and could have a major impact on our lives.

The growth of the autonomous vehicle market

The autonomous vehicle market is growing rapidly. The global autonomous vehicle market is expected to grow from $22.3 billion in 2020 to $87.6 billion in 2030.

This growth is being driven by a number of factors, including the increasing demand for transportation, the rising cost of labor, and the advances in technology.

The demand for transportation is increasing as the global population grows. The rising cost of labor is making it more expensive to hire drivers. And the advances in technology are making it possible to develop autonomous vehicles that are safer and more efficient than human-driven vehicles.

Tesla’s lead in the autonomous vehicle market

Tesla is the leading company in the autonomous vehicle market. The company has the most advanced autonomous driving technology, and it has the largest fleet of self-driving cars on the road.

Tesla’s autonomous driving technology is based on a neural network that is trained on a massive dataset of real-world driving data. This dataset includes data from Tesla’s fleet of self-driving cars, as well as data from other sources, such as Google Street View.

Tesla’s fleet of self-driving cars is the largest in the world. The company has over 1 million cars on the road that are equipped with its autonomous driving technology. This gives Tesla a significant advantage over its competitors, as it allows the company to collect more data and improve its technology more quickly.

The potential for FSD to be a recurring revenue stream

FSD could be a recurring revenue stream for Tesla. If Tesla is able to achieve Level 5 autonomy, it could charge a monthly subscription fee for FSD.

A monthly subscription fee would allow Tesla to generate recurring revenue from FSD. This would be a significant source of revenue for the company, as it would provide a steady stream of income.

The risks of investing in Tesla

There are a number of risks associated with investing in Tesla. These risks include:

• The company’s valuation is high. Tesla is currently trading at a price-to-earnings (P/E) ratio of 100. This is a high P/E ratio, and it means that investors are paying a premium for the company’s future growth.
• The company is facing increasing competition. Tesla is facing increasing competition from other companies that are developing autonomous driving technology. These companies include Waymo, Uber, and Apple.
• The regulatory environment is uncertain. The regulatory environment for autonomous vehicles is still evolving. It is unclear how regulators will ultimately regulate autonomous vehicles.

Conclusion

Tesla’s FSD technology has the potential to revolutionize the transportation industry. However, there are a number of risks associated with investing in Tesla. Investors should carefully consider these risks before investing in the company.

Additional information

Here are some additional things to consider when thinking about the potential of FSD:

• The safety of FSD: The safety of FSD is a major concern. Tesla’s autonomous driving technology has been involved in a number of accidents. However, Tesla argues that its technology is safe, and the company has a good track record of improving its technology.
• The impact on jobs: The development of autonomous vehicles could have a significant impact on jobs. If autonomous vehicles become widespread, it could lead to the loss of millions of jobs in the transportation industry.
• The ethical implications: The development of autonomous vehicles raises a number of ethical implications. For example, who is responsible if an autonomous vehicle causes an accident? And how will autonomous vehicles be used in the military?

Ultimately, the future of FSD is uncertain. However, the technology has the potential to revolutionize the transportation industry and have a major impact on our lives.

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