Tesla's real advantage is their battery production. No one else can compete with them on battery price or production volume at a similar quality: https://www.cnbc.com/2020/02/10/teslas-competitors-play-catc...
They did use off-the-shelf components. They performed poorly and they resulted to developing a custom die with the right components to handle the task of computer vision. They explicitly stated this in multiple interviews. The off-the-shelf solution was crap.
Additionally, Tesla still grows their sales and customer base exponentially. This means that most significant changes in strategy during the production ramp-up will require (in the form of deprecation of now-obsolete production resources) only a small fraction of the investments required to achieve their full, steady-state production capacity.
The same argument holds for the potential case of major changes in battery technology. (Replacements of current fleet excluded, which would not happen for batteries). If Tesla's current battery technology is obsolete in 5-10 years, that's not a very big deal as their sales are expected to be a multiple of today's by then, and the new technology would be phased in during the expected production ramp. (If Tesla fails to grow by a multiple of today's sales, they have largely failed).
Did you ever try to rollout change to millions of units of anything, with individual owners of each item, operating in vastly different environments and with additional modifications from those owners?
Rolling updates is A HUGE issue, if you need reliability. It’s not a random app. It’s, for majority of the people, second most expensive purchase in their live (only behind a house). Messing up with that is very very risky.
I seriously doubt Tesla is not actively improving the chip, and if they need a fundamentally new software approach, then they have the process/iteration loop established.
> All Tesla Cars Being Produced Now Have Full Self-Driving Hardware
> Oct 19, 2016
> To make sense of all of this data, a new onboard computer with more than 40 times the computing power of the previous generation runs the new Tesla-developed neural net for vision, sonar and radar processing software
^ this refers to the nvidia thing 'onepremise says was too bad for the job.
https://www.tesla.com/blog/all-tesla-cars-being-produced-now...
https://www.theverge.com/2016/10/19/13340938/tesla-autopilot...
I don't have time to dig it all up, but they were talking about the potential for computer upgrades as far back as 2016 as well: https://twitter.com/elonmusk/status/789008557341454336 (though not for pre-2016 vehicles).
I can see where people who don't follow the company closely wouldn't have been aware of this, though. And, obviously there have been plenty of false and misleading statements made in this area.
Tesla: $158/kWh Competitors: "more than" $200/kWh
Model 3 SR+ has a 54 kWh battery.
Tesla advantage = (200 - 158) * 54 = $2268 per car.
Yes, an advantage today, but not too bad.
But even that kind of a margin benefit may not justify the current valuation...
https://www.nytimes.com/2019/09/08/business/volkswagen-trade...
Custom silicon seems like a much harder problem for VM/Toyota. Unless a supplier can build something for them I don’t see either company innovating like Tesla. Basically Tesla’s secret sauce is the Tech not the EV components.
Continued improvements to battery tech will bring the costs down for Tesla which is important for them to do if they want to succeed.
Custom hardware and software will also give them cost advantage and help them in the long term.
Mobileye?
https://www.wsj.com/articles/mobileye-ends-partnership-with-...
" Mobileye NV said it would no longer provide its computer chips and algorithms to Tesla after a current contract ends due to disagreements about how the technology was deployed. Mobileye provides core technology for Tesla’s Autopilot system, which allows cars to drive themselves in limited conditions."
What evidence is there that custom silicon has any advantage in the self-driving race, let alone in cost competitiveness?
Their hardware (maybe, at best) solves one of the easy pieces of the self-driving puzzle. It doesn't get them any closer to solving the hard parts. But it sure helps from a marketing perspective, which is kind of important if you want to continue selling a $6000 feature that essentially is just a promise for the future and thus requires buyers to "believe".
Nvidia built a custom chip for Nintendo, I'm sure they would build one for Toyota or VW.
You can scale up manufacturing of inferior batteries, but you still will have an inferior product.
Isn't it Panasonic that manufactures the batteries and sells them to Tesla? Can't they sell the same batteries to everyone else too?
The intellectual property for the chemistry is 100% Tesla’s and can not be reused by Panasonic for other manufacturers. In places where Panasonic builds batteries for other manufacturers, they use more traditional chemistry that includes more rare earth metals. Tesla’s chemistry is patented and can’t be duplicated. It is one of their several “moats”.
If/when Tesla increases battery production beyond its storage and car/semi lines of business, they will probably acquire/merge other car companies on the cheap.
The only thing that can eliminate Tesla's advantage is a catch-up solid battery tech that everyone has access to, and even then Tesla will have lots of infrastructure advantages.
The supposed battery advantage isn't really there. So hopefully the Maxwell stuff is better.
Traditional automakers would rather have batteries that don't easily overheat or catch fire when damaged (NMC) than cheaper batteries (NCA).
It's just one example, but here is a new porsche ev that caught fire https://electrek.co/2020/02/17/porsche-taycan-fire-burning-g.... Does porsche use nmc batteries? What is the problem with nca, where from experience the overall product is superior to all comers?
Remember this isn't about the power of the ASIC processing, it is about minimizing the power consumption of the chip so the EV range is affected as little as possible.
Battery pack production. Tesla purchases batteries from Panasonic and LG (and thus is susceptible to that supply).
> the production rate of battery cells in the Gigafactory had reached 3.5 million '2170' cells per day.
> the production rate of battery cells in the Gigafactory had reached 3.5 million '2170' cells per day.