Elon Musk says Tesla will make a dedicated Robotaxi. How does this impact FSD owners?

Today, Tesla opened their newest factory, Gigafactory Austin with a massive party called CyberRodeo. During the event, Elon Musk took to the stage to speak and managed to drop one massive piece of news that’s actually really significant to the company’s future.

During the ‘What’s next’ portion of the presentation (around 56 minutes of the recording) Musk said, Tesla will make their own dedicated Robotaxi.

We know Tesla has big ambitions when it comes to autonomy and has spent years developing their computer vision approach to operating vehicles. The company has been running the FSD Beta program since October 2020 in an expanding group of customer and staff vehicles. Recently the program expanded to Canada and have plans on releasing into Europe later this year.

Musk said he expects FSD Beta to be available to all of North America (basically whoever has purchased FSD and wants to use the beta) by the end of the year.

Back in 2019, Musk promoted the idea that robotaxi’s were going to be enabled by them launching a mobile app and those who wanted to, would be able to enrol their car in the fleet, earning income for them while the car was not in use.

At the time Tesla said they wanted any car that is leased, back at the end of that 3 year period, with the intention of enrolling them in the fleet and making money for Tesla. With the development taking longer than expected, that really hasn’t come to fruition yet, but when you look at the latest FSD Beta, we are closer than ever.

Assuming progress accelerates and many of the outstanding items on the to-do list, it is conceivable that sometime next year this becomes a reality.

For Tesla’s Robotaxi service to be successful, you’d need a density of vehicles available in a given area to ensure riders could book a ride in minutes, particularly if they’re going to compete with the likes of Uber and Lyft.

When Tesla spoke about Robotaxi and the ability to pay for FSD, then make money from your car, it was clear Tesla would compete with owners for rides.

Most owners probably expected Tesla made and owned robotaxi vehicles to be the same vehicles they can buy, Model S, Model 3, Model X, Model Y, Cybertruck etc, but I don’t think anyone anticipated they’d be competing with a dedicated robotaxi from Tesla.

With a full roster next year, including the Cybertruck, Semi, Roadster and maybe even Teslabot, its likely any new vehicle will be at least 2025 before we see it.

So what form factor, could this dedicated robotaxi be?

One possible scenario is the van/bus idea that Tesla had thrown out as a future vehicle. This could mean, we’re talking about a vehicle that would offer ride-sharing, and as many as 10-15 seats, something like the Navya Self-Driving Shuttle.

This prevents a real challenge to the business model for owners. If Tesla were to run their own autonomous vehicles that could transport groups of people, the cost per rider would be substantially lower than you could offer for a standard 4-6 seat configuration.

Understandably, not everyone wants to rideshare with other strangers, although this happens every day on buses, trams, trains etc. It is plausible that we see tiers to the service and a shared platform like a robotaxi bus comes at a cheaper rate.

Another scenario could see Tesla deliver that ultimate dream of a vehicle with no steering wheel and pedals. This would really be a hardware reset opportunity. If FSD is really ready for level 5 autonomy by 2025, Tesla better has a car to take advantage of it. When we’re at that point where you don’t need a wheel and pedals, having them becomes a big disadvantage as you lose a potential seat for passengers if we assume humans won’t be allowed to use the controls, particularly if they can prove the computer is safer.

When you consider the role of a dedicated car, it could actually be dedicated to a specific urban location. Tesla could engineer this to service a defined metro area. While this runs counter to the current FSD approach of driving anywhere running a localised service could help to deliver revenue to continue to fund the development of FSD (dojo etc) and allow it to progress in capabilities and cope with more diverse edge cases.

This is certainly an interesting development, I’m keen to know much more about it.

You can watch the full replay of today’s event below.