Tesla has lost nearly $6 billion since setting out to revolutionize the auto industry 15 years ago, but CEO Elon Musk foresees a profitable future fueled in part by a ride-hailing service made up of electric cars driven by robots.
The mind-blowing concept is something Musk first outlined in a master plan three years ago, but now he believes Tesla's technology is capable to turning his dream into reality. And that terrifies some critics who worry Musk's plan to transport passengers in self-driving Teslas without a human to take control in emergencies will maim and kill people.
It would work something like this: Owners would be able to use an app to offer their cars as robotaxis, picking up cash by sharing vehicles when they're not in use. The income would offset the cost of the cars. Eventually steering wheels and brake pedals would go away and even the owners wouldn't have to drive when they need their cars.
Also, passengers might not be ready to ride in autonomous Teslas by next year. A recent AAA poll found that 71% of Americans wouldn't feel safe riding in a robocar from any company. With sales falling in the first quarter, the company is expected to lose more than $325 million. In addition, sales of the company's higher-priced models S and X are fading as the vehicles age, and that likely will cut into Tesla's profit margins.
Nevertheless, Tesla has a market value of $45 billion -- higher than auto industry pioneer Ford Motor. That lofty assessment of Tesla's worth has largely been driven by the belief that Musk is a visionary along the lines of Apple co-founder Steve Jobs and Ford co-founder Henry Ford. Current ride-hailing services such as Uber and Lyft that rely on human drivers cost $2 to $3 per mile, according to Musk. He estimates his robotaxis will cost less than 18 cents per mile, so they would be able to undercut the competition.
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