Your ultimate authority for daily Elon Musk news. Exploring the world's biggest ideas with your host Will Walden. There's something new every day. Tesla's head of Autopilot and AI software just delivered some uncomfortable truths about the company's autonomous driving capabilities. They told an interviewer that Tesla's Full Self driving technology still trails Google's Waymo by a couple of years, despite years of bold promises by Elon Musk about robo taxis and coast to coast autonomous
drives. This admission comes at a particularly awkward time for Tesla, which plans to launch its robo taxi service Pilot next month and has spent years marketing itself as the leader in automotive autonomy. Now the timing raises serious questions about whether Tesla's self driving promises match the technical reality on the ground.
This assessment breaks from Tesla's usual pattern or projecting confidence about its autonomous driving timeline, making the comments all the more striking for engineers and consumers who've been waiting for Tesla to deliver on its self driving vision. Now the gap between Tesla and Wemo comes down to fundamental technical choices made years
ago. Tesla chose a camera only approach called Tesla Vision, while Wemo equipped its vehicles with expensive Lidar sensors that cost around $75,000 per unit. Elon Musk famously called lighter a crutch and bet Tesla's autonomous strategy to cameras, and they cost between a dollar and $10 per sensor. This decision seems smart from a cost perspective, but it created technical challenges that Tesla still hasn't solved. Now the performance difference shows up in real world testing
scenarios. Business Insider recently tested Tesla's Full Self Driving software and watched it drive into a bike lane before running a red lane when MO's vehicle took a different route during the same test and avoided both problems entirely. These aren't edge cases or minor glitches, but fundamental safety issues that highlight the technical gap that they acknowledged The Tesla's camera only approach faces inherit limitations that make autonomous
driving harder to achieve. Cameras rely on external lighting conditions and struggle in situations more lighter excels like detecting objects in complete darkness or measuring precise distances to other vehicles. The software engineer admitted that solving autonomous driving with vision only sensors is technically challenging, but argues it's more valuable for the world to have a low cost
solution. This trade off between cost and capability has become Tesla's defining characteristic in the autonomous driving space. The cost argument has become less compelling as lidar prices have dropped dramatically. Modern lidar units now cost under $1000, cheap enough for Toyota to include them in a $20,000 Chinese market electric vehicle. Tesla's cars cost twice as much, but still rely exclusively on cameras now.
Power efficiency is another factor, and cameras use .9 watts each, compared to 10 watts for a Luminar Halo lidar unit. Tesla's Hardware 4 cars use eight external cameras, so the total power consumption difference isn't as dramatic as it appears. Tesla's struggle with autonomous driving matter because they affect the entire electric
vehicle industry's capabilities. When the market leader in electric vehicles repeatedly missing self driving deadlines, that undermines consumer confidence in the brand in in autonomous technology across all manufacturers. Tesla has been promising a fully autonomous Coast to Coast Dr. since 2016, and each missed deadline makes the next promise harder to believe for some consumers.
Now this credibility gap extends beyond Tesla to other companies making similar claims about autonomous driving deadlines. Now, the admission also effects Tesla's business model and stock valuation. Tesla trades at a premium compared to traditional automakers, partly because investors believe the company will generate revenue from
autonomous robo taxis. If Tesla's self driving technology really lags Waymo by years, that robo taxi revenue might take much longer to materialize, And investors expect the gap between Tesla's market valuation and its actual autonomous driving capabilities could force a significant repricing of the stock. Meanwhile, Tesla sales problems extend beyond autonomous driving into core business fundamentals.
The company's global deliveries dropped 13% in the first quarter of this year, while EV sales increased in the United States, Europe, and China. A Musk blames the decline on factory retooling for the refresh model. Why? Claiming the Tesla had to shut down production facilities worldwide to implement changes. He insists that retooling was necessary and timed for the first quarter, when seasonal demand traditionally runs lower.
Now, Musk claims Tesla has seen a major rebound in demand following the factory retooling, but the sales data doesn't support this assertion yet. Tesla's April numbers continue declining, especially in Europe, where some countries saw drops. As large as 80% of China represents Tesla's second largest market, and sales there fell 9% in April, while the overall Chinese electric vehicle market grew 38%.
Now, these numbers suggest Tesla's problems go deeper than temporary factory shutdowns, and the sales decline coincides with Musk's controversial political activities and his relationship with President Donald Trump. Many analysts point to Musk's political involvement as a factor in Tesla's declining sales, particularly among environmentally conscious consumers who traditionally buy electric vehicles.
The Musk discusses this concern, asking how much consumers really care about a CEO's political views when making purchasing decisions. The question reveals a disconnect between Musk's perception and market reality. As consumer sentiment data suggests, political associations do influence buying decisions for many Tesla customers now. Tesla's current situation illustrates the challenge of managing technical innovation alongside public expectations.
Though the company built its reputation on ambitious promises about autonomous driving and sustainable transportation, but delivering on those promises has proven more difficult than anticipated. Now, this honest assessment of Tesla's position relative to Waymo provides a rare glimpse into the technical reality behind the marketing claims. That admission the Tesla trails Waymo by years contradicts the company's public messaging about being ready to launch robo taxi
services. Now it's a fresh departure for Tesla's usual confident public statements about autonomous driving. The willingness to acknowledge this position relative to competitor suggests the company might be adopting a more realistic approach to communicating about its self driving timeline. And whether this honesty translates into more achievable promises and better execution remains to be seen.
But it provides A clearer picture of where Tesla actually stands in the race toward full autonomy. Hey, thank. You so much for listening today. I really do appreciate your support. If you could take a second and hit the subscribe or the follow button on whatever podcast platform that you're listening on right now, I greatly appreciate it. It helps out the show tremendously and you'll never miss an episode. And each episode is about 10 minutes or less to get you caught up.
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