The video highlights the inevitable collision between ambitious software goals and the physical limitations of legacy hardware, signaling a necessary but costly pivot for Tesla's autonomy roadmap. It offers a sobering look at how silicon constraints, rather than just code, now dictate the pace of the Robotaxi rollout.
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Listening to TSLA Earnings Call and Pre-Earnings Spaces on X while on FSD 14.3.1 to go take Robotaxi本站添加:
Hey everybody, JC here. Happy Tesla earnings day. It's Wednesday. It's about 12:15 in the afternoon. About to head over to Willowbrook Mall in Northwest Houston to try and do some more Tesla unsupervised robo taxi rides. Let's get going.
Navigate me to Dick's Sporting Goods at Willowbrook Mall.
Navigating to Dick Sporting Goods at Willowbrook Mall about 27 mi away. ETA around 12:53 p.m.
Goodbye.
Go away, Grock. Go away.
There we go.
All right.
So, on our way to Willoughbrook Mall.
One of the things I'm going to do though is I think that Dallas, he goes by Dallas Tesla Club on X has a space going. So, I'm going to dial into that so to speak while we're on our way. So, let me find his space real quick.
See, usually he puts a link. There we go.
Says right now or this quarter, you know, something that's near-term, that to me would have uh would have value.
But if he says there's, you know, we'll be in 12 cities by the end of the year, to me, that's doesn't mean anything.
>> That doesn't mean anything. No, >> that's fair.
>> Yeah.
>> Um I'm more so >> I'm not trying to be negative. I'm just saying, you know, how >> I'm more so basing it off of like, are they still on the same track as they were? To your point, there's a lot of fluff in there. If they say end of the year, they may actually not be on the same track, but they feel like they can still squeeze it in versus hearing things like, you know, by the end of next quarter or, you know, quote unquote two weeks, if you will, which there's a lot of, you know, jargon involved in that, too. So, but yeah, no, I'm excited. I think the questions have been way worse in the past, right? are you guys working on anything really cool behind the scenes?
Like those kind of questions are just so stupid and there's always one of those.
Um I will say for someone with 2 million uh accounted shares, they have the worst grammar I've ever seen in my life. One of the questions there's like no spaces between the words. Um again, who knows?
But I do think for all the questions that we've seen in the dozens of earning calls, earnings calls we've listened to, this seems to be at least middle of the road quality questions at best.
So >> that's when you know the money was inherited when a when a share you know >> I mean to be fair does he need grammar because he's got two million shares. I mean >> as a retail investor. Yeah. It's like the >> that's why I think it was inherited.
>> He needs to worry about nothing.
>> The heir to the Chuck-E-Cheese throne.
the guy's just like, you know, operates the animatronics at one of the local locations and and all these vehicles poised in, you know, four cities, 14.31 rolling out. Um Dallas and Houston, you know, now having, you know, a few autonomous vehicles. I think now I I I think there's a chance uh of course there's a chance, but I think there's a a solid maybe 20 25 maybe 20% chance of Elon saying we're going to we're going to unleash the Kraken like right now like at this moment. I think there's a chance of that and I I don't think it's, you know, more than likely, but um that's going to happen. And whether it happens on today's call or it happens here in a few weeks um or a few months, um I think we're close.
Yeah, I do want to hear more about their intention with CyberCab. What is the what is the initial intention? Because we know we have these things rolling off the line in some capacity. You know, you can watch Joe's drone videos and come up to your own conclusions as to what's that what that is. But I want to know more about like what is their immediate 60 to 90 to 180 day plan as to where these cars are going to be. Right? We see them testing around the country. the the lid is clearly about to blow off on this thing in a similar way that Cybertruck did, right? Um obviously production scale to a infinitely higher measure, but out of Giga Austin in particular, I'm seeing them come off the line without steering wheels now. So these seem to be relatively polished versions in comparison to what we've seen as the test vehicles. You know, we know from direct sources that the test vehicles are, you know, uh, vinyl wrapped in gold and they have like non-production parts on them. There's a Cybert truck steering wheel stuck in the center. Like very Frankensteined for engineering purposes.
But I I'm I'm under the impression that if they're removing the wheel, the ones we're seeing come off the line in Austin are probably damn near production ready, or rather like final iteration. So, I want to know where these cars are planned to go. um if they don't have wheels and I assume they're not intended to be, you know, the data collection vehicles that we're seeing around the country. I think these have the direct intention of either being added into the fleet or maybe they're going the route of like the first couple um semis they did where they sold them to Fredo and Pepsi and maybe there's some intention to to like partner with a company for the first couple. I I highly doubt that be the case. I think Tesla wants to keep all this very close to the chest. So, I think maybe it wouldn't shock me if we hear something today like, you know, we expect to start trickling in a few of these here and there in Austin and Dallas and the Bay Area. That would just be like the most exciting thing to hear.
Um cuz if you think it's cool riding around in a city in a Cyber Cap or in a robo taxi and it's a Model Y, imagine pulling up to a dinner and you're in a Cyber Cap. I mean, like to me that's just, you know, that's insane. and and the fact that that is a very doable thing because the fleet's already operational. The city's geoences are there. I I mean doesn't seem like it's that hard of a thing to do. They just want to make sure they're doing it right. So, I think that would trip my trigger the most to be kind of most excited about. Wes >> Dallas, you know, I've heard other people say the same thing that pulling up in a cyber cab would be, you know, would be dope, would be really cool. And when they've said it, I thought they were saying like cuz you know, you're just renting the car. You're not like it's not like you own it. So I always never I didn't understand that. You think I mean I think it looks good but >> ran a red light point.
>> Yeah. I mean my general point is just the experience of being in a cyber cab like it and it has nothing to do with ownership or like drivering on people because you apparently own some cool car. I think it's very understood that if someone sees you in a cyber cab it's obviously like a ride share your vehicle. um or most people probably don't even know what it is, right? To the same level that when people pull up in a cyber truck initially when they came out, there was a lot of people who would walk up and say, "What is that?
Who who makes that car?" You know, cuz it looks like something Kanye West drew up. So, it it doesn't look like Tesla historically. There's no Tesla logo on the truck. Um you know, so Cyber Cab in the same way almost looks like a car that no one's ever seen before cuz cuz it is. So, I don't think it's going to be like a monetary flex. I just think it's going to be like, "Wait, how did you get one of those? How did you do that? Can you teach me how you did that?" Um, and I think word of mouth spread will be exponentially greater when people talk about CyberCap versus, "Oh yeah, Model Y came and picked me up with a robo taxi sticker on the side."
Both of which are cool to us because we understand the work that's gone in to make those things happen. But to the greater public, people like my brother who doesn't care about tech, he'll tell his friends, "Dude, I rode in a cyber cab. The doors went up." Like that's gonna move the needle to some degree in my book.
>> It's going to peak a lot of public interest that out of our bubble.
Exactly.
>> And not to oversimplify, but I do think a lot of people will literally like imagine the amount of Snapchats people are going to take pointing their camera at the doors opening up and a screen in the middle and you know, two seats. Like I I don't know. I just think the social media craze of Cyber Cap is going to be real and it's going to be well outside the walls of our glass house. Here are next.
>> I agree.
You know, if I was Elon and and really you're talking about a bigger thing, which is how do they market Robo Taxi to the world to to get people aware of Robo Taxi, get them to want to download the app, get them to order a car. If I was Elon, I would start in the tunnels in Las Vegas. They have, I don't know, 500 cars right now driving people around in the tunnels. It's a big effort. It's very impressive. It's very photogenic, right? Put the first 500 down in those tunnels. Get Las Vegas Cyber Capped, right? Get people to know about it because it's in Las Vegas. It's in the tunnels. It's driving people around. By the way, the tunnels are actually a very simple thing for FSD to do. There's no pedestrians, there's no stop lightss, there's no stop signs, there's no chance this thing is going to have a rack down.
Uh, it's really good at stay the FSD really good at staying in narrow spaces like a tunnel and just have hundreds of them lined up in Las Vegas in the tunnels driving people around and get people to go to Las Vegas and try it out. Every one of us will go to Vegas if that happens, right? Because we want to take videos. Like you said, it's a big Instagram uh treat to get one of the first rides in the cyber cab. We're all going to do it. I'm going to do it.
You're going to do it. We're going to do it together, right? It'll be a party. Go to Vegas, go in the tunnels, get our cyber cab ride, get some video, right?
And show that Robo Taxi has started.
Then put them everywhere else, right?
put them in Austin and San Francisco and everywhere else you can put them. Um, you know, but I say start with a big bang like that. Start them out in the tunnels.
>> The only concern I see with those tunnels is flashing lights.
>> How's it going to deal with that? That's the only concern I have.
>> It It works just fine.
>> It's LED lights. It's like uh being in my house. I have h lights, you know?
They're not flashing. They're just this colored lights, right?
>> It doesn't trip up the system at all, though. Like >> already operates in the tunnel, so it's no different, right?
>> That's what's up.
>> Yeah.
>> I mean, to me, I Robert, I agree. I think Vegas being a very transient uh population. These people, for the most part, don't live there. So, every day you're driving new people, right? It's kind of like going to Disney World.
You're never seeing the same person twice. So, all those people go back to their hometown and tell everyone, "How was Vegas? I lost a bunch of money at Caesars, but dude, I rode in a cyber cap. Like, it was a cool Well, let me see the video. I saw your story. You're going to have that every single day. I do think there's some value though if we're strictly talking like marketing and word of mouth spread to have it in a city, right? Cuz above ground, you have people, you know, drinking sitting on a patio and they go, "Holy [ __ ] that's a cool car. What's that?" And they're going to take a video of it. And then, you know, you have people walking around on South Congress buying boots. Like, I think there's just some value to having these things. no pun intended on the surface so everyone can see them but hey why not both right I think I think filling the need for these different regions is not going to be a challenge with the production capabilities that Tesla has what I'm looking forward to knowing right is where are we at with production capability are they going to get into the weeds there I'm expecting to hear things like we're in relatively small volume production but we expect things to you know Elon's kind of famous line with Cyber Cap has been uh production will be excruci excruciatingly hard to scale at first, but then once we get to like that exponential scale, it's going to be unstoppable. I kind of think that's what we're expect I'm expecting to hear out of him today.
>> I mean, I'm sitting in the 7,49th Model 3 made in the world, right? It took 6 months after the line started up before they made mine. So, uh let's say the line just started up a month ago, right? because we're starting to see pictures of of the full I believe you're right that the ones without the steering wheel are the full production vehicle.
That's evidence the line has started and they're making some. Um so in 6 months can they make 7,500?
They should be able to make a lot more than 7,500 cuz the Model 3 line was is a very inefficient line to make cars on.
uh compared to this Cybercap line, the unbox process when it when it gets dialed in, they should be able to make a fuckload more than they can make of a Model 3 on the Model 3 line in Fremont, right? So, I wouldn't be shocked if by the end of the year, right? It's it's still April, right? Uh by the end of the year, we're going to see, you know, 10,000. I won't be shocked, >> right? And to today it would be nice to know a little bit more about the plans and all that and how it's going. Um, but I I'm expecting somewhere around 7 7500 to 14,000 somewhere in that range to be made in 6 months by the end of the let's call it the end of the uh time to keep in mind too you know the cyber cab while it's really important is is not the robo taxi network right it's all the vehicles um and something I just realized is I don't know how many are rolling how many Model Y's are rolling off the production line right now that have the washer on the camera. Um, has that been reported and I just don't know it. Like, are these things rolling out?
>> Factory and see what they're making. Um, yeah. I I don't know if they're making all of them with the washer camera cuz that would make sense. But >> yeah, does anybody know? Yeah, you're right. I mean, is that kind of like how they're doing it now or is that just still only robo taxi?
>> Wes, it's a good point. And I think, you know, it's it's one of those small things that you'll see Sawyer post like and randomly where he'll just go, "Oh, all of a sudden all new Model Y's have a dark headline or whatever." Like, it's going to be one of those things where it won't be a big deal. It'll just be a random Wednesday and all of a sudden Tesla is going to have every Model Y coming off the line with a with a with a rear washer. That's hard to say. I also don't think it's going to be a hard retrofit. I really don't. I think that's something a simple service uh center visit. They can, you know, they already have an irrigation plumbed system in the car. You know, they could probably run a line to the back of the car very simply.
And if that's all it takes to get AI4 Model Y into the fleet, like that is a very low cost to entry for Tesla to get these cars to be robo taxi ready. So I, you know, who knows? But I think that seems like an easy fix. Yeah, have video on this.
>> Yeah, somebody should do some homework.
Go go go to the factory and see what's coming off the lines. You know, I I see Model Y's. I just never even think I'm looking for a washer on them. Uh you know, cuz out of the Fremont factory, you see uh semi-trailers full of them coming out of the factory. Um it would be easy to validate it. It's one of those little things too that just makes your car better, you know, having a washer on the back cuz that I just I'm in rain, you know, and my back camera gets dirty and you got to wipe it off uh to really you, you know, feel good about it. Um, and so having a little washer back there would be, you know, make your car a little bit nicer. Well, I'm wonder, hey, would it be inappropriate to tape one of these uh, you know, some of these Uber drivers that are, you know, kind of going to be rolling off the Uber line or business, maybe take them to the back and just have them wash it, >> you know, like Turk for, >> hey, five bucks to wipe off all our sensors on our cyber cabs. You know, >> I didn't spit that out really well. And of course, I'm kidding. in GC. I'm not messing with you either, man. It's all >> Uber Uber would be very willing to take our dollars, you know, for sure. You know, >> I have an employment opportunity for the pan handlers on the side of the highway that you see in every city if they've all cleaned Tesla rear cameras.
>> Come on, baby.
>> Come on, dude. I mean, this is this is an opportunity to increase the quality of life for thousands of homeless people around the country.
>> Yeah. Well, these the ones that have the sprayers already, too, right? They've got the the wipe, you know.
>> Yeah, they're trying to wash my windshield. Don't wipe Don't clean my windshield. Clean my rear camera and I'll give you five bucks.
>> No, I'm kidding. I'm going to get cancelled for that. JT, welcome up.
>> Hey guys, how are y'all doing?
>> I'm good.
>> Great.
>> I am uh on my way into the geoence here in Houston. I'm about 10 minutes away.
Going to um go to Willowbrook Mall and then I've got about I'll see. You know, you never know. You just got to go into the geo vents and see what's up. But I've got about uh three or four points of interest uh new places I want to try to take the robo taxi to. So yeah, that's uh that's the plan for the afternoon and to listen into the space while I'm doing it depending on >> LJC.
>> Well, I'm not that guy. I I have I mentioned on one of my videos, we've got so many smart nerds in this community and I'm not an engineer. So, when folks are like, "Push on that, pull on this, yank on that." I don't even know what the hell I'd be pushing, pulling or yanking on. So, I'm going to leave that to the smart nerds and the jarhead nerds. I'm just going to sit back, enjoy the ride, and film it. And uh hopefully people in Porter, Texas and New KY and McGomery County and Willoughbrook Mall and A Leaf and Fifth Ward, Fourth Ward, Third Ward, all of them. And [ __ ] all those people in Midtown and River Oaks.
You bougie bastards. I hope Robo Taxi never comes to y'all. That's a joke.
>> It is. It is funny that the areas which they put it like I I heard an argument of someone saying that they placed it in an affluent area on purpose in Dallas.
It's complete [ __ ] because it couldn't be more different in Houston, right, with the where they place the geoence. So like I there's no socioeconomic drivers here with their GF Dallas. I'm going into the hood to go to the best place to get the the the Houston robo taxi. I'm literally going into a known hood. And honestly, the people are going nuts. That's why I chose Willowbrook Mall cuz it's like doing actual smart summon in a parking lot. You know, you're going to get people to come up. Dude, the people go freaking nuts at Willowbrook Mall when they they come up there. Now, I would not suggest being at Willowbrook Mall past maybe 6:00 or 7 in the evening. Um, unless you're there to get, you know, vitamin D, but hopefully nobody in the Tesla space here is uh into the hardcore vitamin D like uh the the folks that you were talking about earlier that stand out in the middle of the road with with washers. I'm not so sure you'd be able to get them to work. I honestly um you know, heroin and meth and crack don't really mix well with wanting to try to do a really nice detailed job on a rear camera. It does really well for trying to steal the rear camera. Um so I'm not sure I'd really want to use those folks.
>> Hey, Hustle Town, you better get your ass out there. JC's going to go ride around without you.
>> I was just thinking about it. I was going to tell him that I I want to go to uh what is it? Bombshells 290. I had to come and get my dog a little snack. You know, >> Bombshell. I was going to take it to Splenders men's club. See, you know, hey, they start that lunch that that brunch.
>> I'm just kidding.
>> All right, we'll coordinate. We'll coordinate.
>> And there we go.
>> We have an update on how many autonomous vehicles we have running around in all three cities right now, or what do you guys know? I can pull it up. One second.
Let me look. Y'all chat. Uh, >> while you're looking for that, Dallas, quick question. So, for cyber cab, right? Like I'm I'm just wondering what is so is the idea to for the robo model Y robo taxis that are being deployed now.
Do you think those will eventually the game plan is to just wait for you know cyber cab to go to like mass production or you know keep or or will they keep deploying the Model Y robo taxes until like our personal cars you know get the unsupervised or get the green flag to add them to the fleet? Is that the plan you think or >> I mean I'm I'm obviously just uh pontificating JC but I do I do think my my if I had to guess I think adding Model Y's right now is working uh the Cyber Cap is still a very very early vehicle obviously like even if they've got to a point where they feel like it is a near release candidate or even a release candidate uh I to me I think if we see any added it will be in small numbers probably closer to home so maybe just in Austin to start, see how they do. Um, and then as they ramp production, probably start trickling those in across the country. But to me, I think I think we see we only see the Cyber Cap in robo taxi service first is my guess and then maybe towards the end of the year like Elon said, they might start selling a few to people. I think they're going to be very selective about who they sell them to um based on where these people live, right? because they don't want someone to come in and arbitrage an area or like they I don't know they I feel like they're going to be selective in a sense like kind of like how they do with FSC like guys like Omar and David Moss are probably going to be >> Dallas is there is there really an issue with arbitrageing an area these things are going to be autonomous you can send them anywhere >> like I I I don't I that I've heard that argument before like what if somebody comes in and just floods one area with bro first of all that's a great problem to have like okay let's let's start there number two I think people are forgetting these things are autonomous you can send them anywhere like what is it you you have to keep one 5 miles away from your house that that >> in a perfect world you can send them anywhere but like I think the initial roll out of cyber cab where people will be able to own them we will still be in these confined geoences like we are today probably a larger scale than we have today but I think you know these cities that have geoences now will be the people who will get to purchase these cyber cabs because they're in an area that Tesla's confident in. Again, I'm completely guessing here. If anyone has a better guess, jump in.
>> Dallas, real quick, can I just want to clarify? So, my question wasn't question wasn't around like cyber cab deployment or like when we'll be able to buy them.
It's more so like will the Model Y, you know, with the robo taxi label on them, the special Model Y, like do you think those will slow down in production? like they'll stop deploying those at some point and it'll be replaced by cyber cab or do you think they'll just keep having them on the network till like we can you know because I mean it's bigger than the cyber cab so there's that you know >> yeah the the fleet will always include Model Y because there's going to be a day where people can add their own cars to the fleet so not everyone's going to own a Cyber Cab um and I think I think CyberC will make up for a ton of the vehicles on the fleet obviously with Tesla putting them out themselves but I do think there will be a day where Tesla themsself doesn't add Model Y to the fleet but rather only add Cyber Caps just from a cost perspective. I think that makes a lot more sense to put a purposebuilt vehicle that doesn't have door handles like you know they like I think small stuff like that like the car is designed to be used as a robo taxi right they can close the doors themselves they don't need to pay door dashers like Whimo does to go close Whimo doors so and that's just one tiny example but um cost per mile the cyber cap makes more sense production and everything so I kind of just think that's the way they're going to go but I don't think we're there for a little while. I think for the time being, we're going to see more Model W added. I do have a theory that we probably are at close to a point where we don't see supervised robo taxis added. Um, we may still see some added here and there.
Obviously, the Bay Area has its own thing going on, but seeing Dallas and Houston, we talked about this earlier this week, seeing Dallas and Houston go live only unsupervised, I mean, that's major signal to me that we may just never see a supervised robo taxi in Dallas or Houston.
>> Hey, I'm Dallas and you're in San Francisco.
>> One second. Scoble Lincoln, what were you saying?
>> Um, is arbitrage the right word? Is that what you mean? Or do you mean flood?
like >> well yeah I meant I I meant to say just like flooded region and when I say that >> yes like oversaturate the region and I >> yeah really that's only that's only a problem if it's a geofenced area like if you had people and that would only become a and it's not really a problem but it would only be a problem if you opened up cyber cab ownership to everyone and anyone at one time so then people from around the country could all buy one and then fill trailers with that >> good a solution looking for a problem.
>> Yeah, I agree. I'm just I'm answering a thick question.
>> I want to ask is just there's someone here in Salt Lake City that wants to buy um um 100 of them right now and set it up and like I think it's cool and everything but yeah it would affect you know other people who maybe want to use it as well or make money on it. But >> yeah like it's hard to hear you brother.
I think to be quiet, but yeah, no, I I I understand what you're saying, Lincoln.
And I mean, I'm one of those people. I'm going to I mean, I have a business opportunity to where these things do come out to customer owned. I my intention is to buy probably 20 25 cyber cabs and build a fleet myself. So, I think there's going to be a lot of people in that same position who see this as a business. And I agree, JC, worrying about, you know, flooding a region. What a great problem to have, right?
We have too many cyber cabs like going out and making money like okay I I'll take one on the road cuz we don't even have one cyber cap. So I see >> worrying about that.
>> Yeah I I do want to make a point.
>> Go ahead.
>> Thanks. Sorry. There's significant business risk in doing anything prematurely with this. We have to see the terms from Tesla because they may have, you know, when you think about somebody, a customer, non-Tesla person buying a Cyber Cap at the end of this year, you know, if they sell it to somebody like myself or whatever, um, and I don't put it on the road very much, I just maybe I just want my driveway. It looks good. My neighbors want to see it. It looks cool. Tesla would lose the opportunity to print money with it. They need it on the road.
So there'll be terms for example that hey Wes if we sell this car to you we have to have x amount of hours of utilization per you know whatever and at this particular rate during these particular times maybe it's more fuzzy than that but there's going to be a huge set of terms around this that before anybody goes out and buys a car wash or you know rents a lot for all their cyber caps it's you know it may not be a great business frankly unless certain circumstances And is that all?
>> That's all. I'll finish with that.
>> Let's talk about San Francisco. Forget the rest of the world. San Francisco, if you try to order a robo taxi on a Friday night or a Whimo, you can't get one.
There's no supply. There's lots of demand.
Second, if you study the Uber drivers in San Francisco, there's certain neighborhoods that make more money than other neighborhoods.
Like hanging out near the airport makes you more money because there's a lot more rides that are longer rides that pay better near the airport. So, the the high-end Uber riders, they know where to hang out. JC could tell you where to hang out in Austin or in uh Texas, right? to make money. And uh we haven't even started satisfying any of the demand in San Francisco yet. So let's just figure that out first. Right. San Francisco is here. Here >> it's San Francisco is ground zero for autonomous vehicles. You don't win if you don't win San Francisco, you don't win anything.
Well, are we still sitting at less than 500 or near 500 robo taxis in San Francisco?
>> Yeah, but let's be honest, Robo Taxi right now is an engineering project. It isn't really, you know, a serious, you know, take over the world.
>> Yeah, somewhere around 450.
>> Yeah.
>> Hey, Wes, I have your figure too on um unsupervised vehicles in the fleet as of now.
>> Uh the current number is 17.
>> Okay. including Austin.
>> Yeah, Austin, Dallas, and Houston. So, Dallas and Houston each have four or I'm sorry, each have two. So, four in total, two each. And then Austin has 13.
>> Cool. Thank you.
>> And what's funny, Austin is only operating the small geoence at the moment. It's like right now the robo taxi tracker just put out a post like two hours ago and they said Austin today the greater service area is not available. Only the small unsupervised geoence is available. So the one that's around South Congress that operates from like 11:00 to 3 p.m. Um David Moss might be in here. He could explain this a little better. But uh as it stands right now the greater large is is not active in Austin.
>> We just said 15 like two days ago.
>> Yeah. Yeah, I mean I I was going to say I I don't think these you know, of course we we're going to pay attention to it because, you know, we're all nerds and and obsessed, but you know, it right now I agree with Robert like it it really doesn't matter.
Like they're going to they're going to scale this thing like by the end of the year like we're not going to be I don't I think by the end of the year I mean I love I love the robo taxi tracker. I look at it every day. I think by the end of the year it's going to be absolutely useless. like you're literally not going to be able to track the cars. Like you there will be too many to track in my opinion. Um, so but yeah, as far as like what Wes was talking about, I mean, me personally, I haven't talked about it too much, but um, me and my family are going in and we we actually already have an LLC uh, business plan and everything uh, put together, but we're we're we're kind of laying down the groundwork for what you need in order to have a robo taxi fleet. Because if you like where I live, like Whimo and uh Tesla aren't going to come here um in even the near to midterm future. There's not enough population here. It just wouldn't make sense. And they're going to do what we've been talking about for a long time, which is lean on, you know, customers buying these fleets and running them. Now, how what are all the details and how is how is it all going to work out? We don't exactly know. But I do know one thing. In order to have a fleet and it to be able to run it, you need two things.
You need a parking lot and you need chargers. And Tesla has supercharging for business, which is what we're doing.
And we can make money. You know, let's say robo taxi crash and burns and never makes any money. Well, we still make money off the superchargers. So, you know, I'm I'm already like I'm, you know, >> of us in here, like we're already all in. All right, I'm going to go ahead and uh shut her down and start getting ready for robo taxi. Talk to y'all later.
Byebye. Hey everybody, JC here. All done with the robo taxi rides today.
>> I'm going to stop at the water burger uh before heading out and then we'll listen to the earnings call on the uh way back home, but I'm going to listen to Omar Space in the meantime. All right, let's get going.
>> Said no.
So >> when how is Farza talking to Lars?
>> They just he just uh tweeted to him. I put the Twitter reply. Yeah, >> I put in the comments.
>> This is I mean people just like don't know how any of this [ __ ] works, you know? They just say so much [ __ ] The 2500 cap only uh applies if you're seeking an exemption. They didn't seek any exemption. They didn't apply for any exemption. Right.
>> Right.
>> So, yeah. I mean, so it's good to get confirmation. I I thought it was so funny.
>> Farzad was so, you know, you'll see you will all bow to the king and kiss my ring. I'm like, okay, dude. Engagement farming. And then the other day he goes, well, you know, if this is true, I'd be very happy to be wrong. and you know I think that would be very exciting. I'm like all right dude like you you were so excited about this and um yeah there really isn't any limit to to what they can do here. It's not true that they can only make 2500 a year. And by the way, even if they could only make 2500 a year, Whimo has uh 3,000 cars. They already have 500 Model Y's or sorry, 600 Model Y's on the road.
Even if they made 2500 cyber cabs, they'd have more cars on the road than Whimo did did today on the robo taxi network. So that's a lot of cars. But um >> which water burger am I to?
>> There actually is no requirement in the federal motor vehicle safety standard since 2022 that you have to have a steering wheel.
>> Common misconception. They already updated the rules to say if you're an autonomous vehicle, you don't need controls, right? Makes sense, doesn't it?
So the federal government has literally gone out and had press conferences and they had zukses and cyber cabs and other vehicles without controls and they said >> this is what we want. We need to beat China. We need to get these cars on the road. So they're going to get it done one way or another. Um when you sort of frame it that way, then if you don't do it, then you're letting China win, right?
So, they're signaling their intent very clearly here. It's crystal clear. This isn't like a a European situation where they're fighting against the regulators.
The regulators are on board and you know, they have a relationship.
Obviously, he he donated to help get that administration into place. Um, even if there was something that was technically not in compliance with the FMBSS, all they have to do is look the other way and not enforce it until the rules are changed. So, I think we're going to be seeing cyber caps on the road on the robo taxi network with no steering wheel. You're going to open the robo taxi app, call a car, you'll have a two-seater or four-seater option. If you pick two-seater, you're probably going to get a cyber cab. And those doors are gonna open up like you're Russ Hanimman.
And for $3, you can feel like Russ Hanaman.
>> 11 minutes. Yeah. Let's go.
>> And they'll take you to your destination. You can stretch out. You got a ton of leg room. You got a super big TV. You can watch Netflix, >> listen to music, do whatever. And >> yeah, I think it's going to be a great experience. And I think they're even going to be able to sell them to people.
So, sell someone one in Texas for $30,000.
>> There's more and more service areas, Houston, Dallas, Austin.
>> Not sure what they're honking at.
>> They can put their car out in their network use.
>> As long as they're within one of the unsupervised areas, which is just going to get bigger and bigger.
>> How is it different than the unsupervised cars Tesla's already running themselves?
>> So, At at a certain point, the steering wheel actually becomes kind of a safety issue. When someone can touch the steering wheel or knock it accidentally and the car actually moves, that's not really ideal.
So, it's going to actually be nice to be able to sleep and not worry about accidentally kicking the wheel or accidentally kicking the brake pedal or the accelerator, right? It's actually going to be safer. At a certain point, the human is just adding in mistakes.
You know, you've probably seen it where you go, "Oh, why is the car slowing down?
Oh, there's actually a guy crossing the crosswalk and I didn't see them. The car saw them." Especially now with the new model, they've improved low light performance even more. This is going to start happening more and more. The other day, my girlfriend, as we were pulling in, she said, "Oh my god, it saw that cat that was in the driveway next to ours, and I didn't even see that cat, but it saw it." And then when I saw it in the visualization, I looked and there was a cat. So, if you give the user the option to like press the accelerator pedal and override or take over an override, more often than not, they're actually going to be contributing a mistake rather than a fix, right?
So, I think this is going to make a lot of sense. And this is the first vehicle without controls. I think you're going to start to see versions without controls sold throughout their lineup.
Because wouldn't that be better for the robo taxi network for the for the four or five seaters? I mean, if you remove the controls, then you can seat five people in a Model Y instead of just four, right?
So, I think it makes a lot of sense they're going to start doing Model Y's, Model 3s. They've already talked about doing Cyber Trucks without a steering wheel. And um I think a lot of people will actually prefer those models because they have more space. Me personally, I love driving my Teslas manually. So, I love the ones with the steering wheel, especially if it can be turned off with steer by wire.
But yeah, they said it in the deck.
They're designing all their future products to be designed for autonomy.
And I think we all know what that means.
They're going to start looking more like the cyber cab. Bigger screens and less physical controls.
>> Okay, cool.
>> Xander, >> I just want to point something out from the slide deck. Uh, pinned it to the top. Typically Q4 is negative uh sorry is positive and Q1 is is negative uh compared to the previous quarter but this year we're we're seeing a little bit of an anomaly both in vehicle deliveries and adjusted IBITA. So that is a good sign for the number crunchers.
I'm telling you stock is too easy to make money on. It's the same [ __ ] here.
Everyone freaks out during Q1.
They sell at 3:30.
You get past Q1 and everything just starts improving every quarter after that.
People are really dumb. Some of these patterns are so predictable.
All right, let's get ready for the earnings call. We'll continue the discussion for the next 10 minutes and then um we're going to play the earnings call right here.
>> Z, how are you?
>> Yeah, go ahead. Meta, >> uh you were about to say something and I think either my network cut out or you got interrupted, but you were saying uh you know there's some issues with the coding models these days. If you had a wish list, let's just say you could make some wishes to a genie. What are the things you wish the models could do today?
boy. Um, you know, they still lack a lot of common sense. like I'll tell them, hey, I want you to go develop a web page and um like implement it in Python and you know use um MySQL as the back end and it'll go make the web page and it'll say implemented with Python with the MySQL backend on the homepage and I'm like why did you say that? Like the user does not need to know that implementation detail. It's almost like it's just sort of regurgitating the prompt rather than like actually knowing what makes sense. And then a lot of this is starting to get filled in, but sort of like, you know, um the development and then I I kind of have to look at it and I have to tell it if it makes sense or not. I would love for it to be able to open up the actual app or web page itself, actually look at it, identify the issues itself, rather than me having to notice, hey, the you know, the alignment on this is off. This isn't working well on mobile, that kind of stuff, right? Like I'm I'm I feel like I'm becoming kind of the idiot in the loop. Like >> I know what you mean. Like like yesterday I was like >> you're the key >> just going through my like logs and like looking at exceptions that were thrown by the application and I literally told Claude code okay I'm going to copy paste like a bunch of exceptions and then I want you to fix them and I would literally just like copy the error in the stack trace and then it would be like okay fixed it fixed it fixed it >> and I'm like why am I even here >> you're the robot you're doing what the robot should do >> yeah I mean Like >> the ideal end state of this is that it just kind of looks at the logs itself and writes the fix itself and then I just have to maybe like give the thumbs up to you know approve deploying it.
Ignoring the fact that you have almost a thousand people in this room. I'm just going to ask you a direct question if that's all right with you. Would you rather wait a lot longer and get a higher quality result or would you rather not have to wait and be in the loop iterating with with the idea that sometimes if you wait a lot longer it might go off completely in the wrong direction like say you were working with a a a contractor who was building something for you.
I mean, I I want to be the, you know, the CEO basically.
I want to be in the loop to some extent driving the models, but I want the company to run like a software company.
And that makes sense. You know, like I think this idea of like macro hard that Elvon talked about is actually kind of an insane idea when you think about it because before you coded the product, now you can actually code the whole company. I can go uh set up a development team of agents that are, you know, looking at tickets in Jira or whatever and implementing them automatically. I can go set up a customer support team that's talking to customers, talking to them on the phone, talking them to voice, and then, you know, maybe surfacing some insights from talking to those customers that gets fed to the development team. I could have a financial team that's actually looking at the finances in real time, adjusting pricing, coming up with new offerings, passing that to the development team.
The like almost every function of the company could be software. So that's like what's really interesting to me.
Like we're entering an era where it's possible to have a a oneperson unicorn, one guy running a billion dollar company and the company's just all software.
Like obviously I think the models need to get a little smarter before that happens, but it's Wonder what happened. Oh, I can't hear.
Maybe they're shuffling people around.
Let me try that again.
No, sorry.
See if I can get back in, >> their job becomes a lot easier >> and a lot better.
um they'll start to understand it and I think people are I think we've moved past some of this uh bubble conversation.
>> Um >> let's see.
>> I mean if this is a bubble it's just an incredible >> incredibly fun bubble.
>> Oh I think they're over there.
>> I've never seen a bubble where the world changes so much. Um >> yeah it's on the other side bubble the world changes.
>> I'm probably going to have to manually drive.
>> Yeah. But, you know, I would say >> it wants to do here.
>> You know, the internet actually didn't end up being >> Oh, there we go. Maybe it'll do.
>> Maybe the market shot >> because I got curbside. Let's see.
Is there a curbside over? Yeah, that's where it is. Keep going here.
There we go.
No, man.
>> I wish there was a way to >> tell it which one you want.
>> Those tech companies that survived and thrived. So, >> I mean, it's >> maybe we'll see something similar here.
I don't know.
>> All right.
>> Got a couple minutes though.
>> Well, I'm going to be a fun one.
>> I have did not eat lunch, so I'm going to get something to eat. I promise you I will not have let make you watch me eat, but uh definitely want to listen to the earnings call uh along the way. All right, everybody. Talk to you in a little bit. Bye-bye. All right, everybody. Done at Waterburger. Let's head on to the Casta and listen to Elon talk on the earnings call.
>> That'll be dismantled next month and the after the last of the SX vehicles done.
Now, you can't you can't dismantle some gigantic production line for a bird >> like overnight. it takes a at least a few months to do so. Um, and then uh you you've got to install a new production line. Um, and you've got to provide all of the the wiring and communication uh, you know, test out the machines um of of the new production line for Optimus. So that that also takes several months. Um, so frankly, if if we're able to go from um soft production on one line, dismantling that entire line, reinstalling a whole new line, and turning that on in a matter of 4 months, uh, that is a an insanely fast speed.
U, I don't think any other company on Earth has ever done that before. just to put things into perspective and inject some reality uh into uh the situation here. Um >> got a lot of traffic here on veterans.
>> I don't know what the production rate of octopus will be this year. It is impossible to predict these things. Um the when you have a uh brand new product in an entire new entirely new production line and and you have 10,000 unique items all which have to go right to ramp production. It will move as fast it will move as fast as the least lucky slowest dumbest part in the entire 10,000.
Um, and this is a Optimus uh is is a completely new product with a completely new production line. Um, so uh it's uh it's just literally impossible to predict.
um ex except that I I I think it will be quite slow at first um as we iron out the 10,000 plus unique items that have to be sold for Optimus to um reach volume production.
Um initial skills will be obviously we're going to start with with simple skills um in the factory and and then build up from there.
Great. Thank you, Elon. Uh the next question is, "What milestones are you targeting for unsupervised FSD and robo taxi expansion beyond Austin this year, and how will that drive recurring revenue?
Um well we we certainly hope to be have uh unsupervised embassy or that robo taxi um operating you know in I don't know uh a dozen or so states by the end of this year. Um, initially, you know, we're we're taking it very we're taking a very cautious approach to the roll out here. Like we we haven't had any injuries, certainly no fatalities to date with the unsupervised unsupervised FSD and rover taxi expansion. We want to keep it that way.
And so um I don't I think probably uh unsupervised FSD or rover taxi will not be super material this year but I do think it will be material it'll be material probably in a significant way next year.
>> Thank you very much. Uh the next question is when do you expect FSD unsupervised to reach customer cars um I'm just guessing here probably in the fourth quarter um it's it's difficult to release this like to everyone everywhere all at once because we we do want to make sure that they're not unique situations in a city that, you know, a particularly complex intersection or, you know, actually they tend to be places where where people get into accidents a lot um because because they're just, you know, perhaps there's an like I said an unsafe intersection or bad road markings or um you know a lot of weather challenges. So, so I think we would release unsupervised gradually to the customer fleet, you know, to Yeah.
Um as we feel like a particular geography is confirmed to be safe.
>> Great. Uh and uh the next question is how will hardware 3 cars reach unsupervised MSG?
Uh unfortunately hardware 3 I wish it were otherwise but hardware 3 simply does not have the capability to achieve unsupervised FSD. Um, you know, we did think at one point it it would have that, but uh relative to to hardware 4, it has only 1/8 of the memory bandwidth of hardware for and memory bandwidth is one of the key uh elements needed for unsupervised FSD. is is just generally a thing that's needed for for AI for if you're doing an older aggressive transformer memory bandwidth is the choke point. So, um for customers that have bought the my phone there, >> um what we're offering is essentially a trade in like a discounted trade in for cars that have um AI4 hardware. Um and um and and we'll also be offering the ability to uh upgrade the car to replace the uh computer and you also need to replace the cameras unfortunately um to go to hardware form.
Um, so to do this efficiently, we're we're going to have to set up uh like kind of micro factories or small factories uh in major um metropolitan areas in order to do it efficiently. If it's because if it's done just at the service center, it's it it is extremely slow to do so and inefficient. So we we basically need like many production lines to to make the change. Um, and um, I I do think over time it's going to make sense for us to convert all hardware 3 cars to hardware 4 because that's what enables them to uh, enter the rover taxi fleet and and have unsupervised FSD.
>> And for what it's worth, um, in the meantime, we're going to also release uh, a V14 version for hardware 3. Uh this will be a distilled version of the same V14 software that we released for hardware 4. Uh and to be able to start the drives from park state uh and basically have all the features that V14 uh for hardware 4 has and that's expected to come uh end of June.
>> Great. Thank you very much. Uh the next question is uh what enabled you to finish the AI5 tape out early and were there any changes to the original vision? Last week Elon said AI5 will go into Optimus and the supercomput but one month ago said it would go into the robo taxi. Has AI5 been dropped from the vehicle road map?
Well, the reason A5 tape out finished early was because the team worked incredibly hard to make it happen and um just over time we we gathered a lot of momentum. Um but we we did have to work every weekend for 6 months straight including every holiday. So it was uh a lot of sacrifice by the team and and I was there of course myself every weekend. Uh and uh you know fortunately we didn't encounter any major we we didn't make any major mistakes that were at least that we're aware of that required um pushing out the tape out. So the team just did a great job and worked incredibly hard is the reason. Um uh yeah, I do expect that AI5 will go into Optimus and into the data center um because it it's it's looking like we'll be able to achieve um unsupervised self-driving with uh AI4 that is far greater than human safety levels. So, um, which means it's it's it's not certainly not immediately needed in in the car. Um, at some point I think it will make sense for us to switch to AI5 in the car, but that's but there's not a pressing issue to do so. Um so but at some point the AI4 hardware is going to get like so old that it's like okay uh you know the only reason they're keeping the factory open is for AI4. Um we we are planning an AI4 uh upgrade uh to use a newer generation RAM. Uh so it'll it'll go from uh 16 GB to I think 32 GB of per SOC. So a total of 64 GB um and um probably a 10% increase in compute in sort of in trillions of operations per second and in memory bandwidth. So that's uh AI4.1 AI4 plus probably uh goes into production middle of next year, I think. Depends.
It's it's uh depends on on uh Samsung's doing the modifications for us, so it sort of depends on on when they're able to finish that finish those modifications and bring it to production.
>> Great. Uh the next question is, uh now that FSD has been approved in the Netherlands and is expected to launch across Europe this summer, can you discuss your robo taxi strategy for the region?
Well, we're probably jumping the gun here on um robo taxi in Europe since uh it is uh took us an immense amount of time just to get supervised self-driving approved in Europe and uh you know these uh we don't control the regulators you know it's uh we push as hard as we can but but that's it's ultimately up to the to the governments in Europe and the EU to decide what uh what to do. Um so, uh yeah, as is we've only been approved in the Netherlands. We expect to be improved approved in a lot of other countries and I think the um supervised FSD goes to Brussels for EU review um in May.
Yeah. So um obviously the the next thing beyond that is to um aim for unsupervised self-driving or rover taxi in Europe. Uh I actually don't know what the time frame for that is and and would be somewhat at the most of the regulators as to when that approval would would take place.
And from a technology standpoint, u what we deployed in Netherlands and Europe is the same uh exact architecture uh and the training procedure and so on except it had more Europe data. Um and I suspect the same thing will be true for unsupervised FSD as well. Whatever we used to solve in the US will work in other places in the rest of the world too. Uh provided we were able to add the data from the local regions.
>> Great. The next question is uh given the recent Nitsa incident filings, can you update us on the Robbo taxi safety data?
If safety validation remains the primary bottleneck, why not deploy thousands of vehicles to accelerate removal of the safety driver?
>> And do you want to take that?
>> Yeah. Uh we are increasing the amount of our QA fleet, but we also want to use uh the customer fleet to um give us uh the useful metrics back so that we can scale it safely. like mentioned we are absolutely focused on safety and so far we have zero uh incidents um and that's what the nits of highing also shows in addition to safety we are also solving some of these uh so-called scaling issues for example you do not want the robot taxi to be stuck blocking intersections or don't want to be dropping people off at uh slightly incorrect locations and so on so we simultaneously solving the long tail of safety uh by monitoring the metrics across the entire Tesla customer vehicle fleet which are you know uh is close to driving 10 billion miles on FSD uh in the next uh few weeks uh and also scaling up the amount of QA fleet that we have across the entire US to accelerate our safety validation uh while also scaling uh the rest of the factors that can um you know throttle the um increase of unsurpris All right. Uh the next question is, is V14.3 still the last piece of the puzzle to enable uh large scale unsupervised FSD and robo taxi or do we have to wait until V15?
Well, um, no I I think 14.3 is is is the last piece of the puzzle uh for unsupervised FSD. Now the question is like degrees of safety. um like how so safety and convenience I suppose. Um we we have a lot of known improvements um like major architectural improvements that we know would improve the probability of safety significantly.
So I think it's it's not going to make sense for us to deploy, you know, unsupervised FSD or robo taxi at large scale when we we know that there are major architectural improvements to the software that can improve safety. Um so so I think we we're going to want to uh finish writing that software, validate it and release it before uh going to large scale unsupervised FSD depending on what large scale means. I mean we we we are of course as I mentioned earlier uh doing unsupervised FSD in three cities and we'll expand to like I said probably a dozen states or more later this year. Um, so kind of depends on what your definition of large scale is. Um, >> but I do think it wouldn't it wouldn't be right for us to go go to go to like very large scale and supervised FSD when we know that there are software improvements in the pipeline that would improve safety.
>> Yep. And I'd like to note that the version of robot taxi that's running in Austin, uh, Dallas, uh, Houston, etc., of those are essentially 14.3 variants.
Um, and it's obviously uh safe that that's why we're able to launch in those cities and we continue to expand based on the V13 uh sorry V14.3 base um for a while until V15 lands and V15 is going to be a major upgrade.
>> Yeah.
>> Okay. Thank you. Um the next two questions we've already answered uh about robotopexi uh roll out um and uh the data that that we're observing. So uh we will end on the last question which is uh what is Tesla doing to scale the energy generation business with solar residential roof deployments have stalled. Will Tesla move to regional solar and battery farms perhaps coupled to superchargers? Uh will we deploy solar through utilities?
The overall US residential solar market is going through a bit of a correction after the loss of the homeowner tax credit last year, but we still see strong demand shaping up for the second half of the year. Tesla introduced a lease product this year that allows us to capture the tax credit ourselves and offer competitive pricing for homeowners. We've also debuted our own solar panel with superior performance and aesthetics uh as well as our own best-in-class uh mounting system that gives us a fully integrated home energy ecosystem.
We believe we strongly believe that solar and storage markets globally will continue to grow at both residential and utility scale and we will continue to invest in that growth.
>> Thank you, Mike. Uh so now we're going to move on to analyst questions. Uh the first question is going to come from uh Will Stein at Cruist. Uh Will, please feel free to unmute yourself when you're ready.
>> Hi, can you hear me?
>> Yes.
>> Yes, we can.
>> Great. Great. Thanks for taking my question. Um, considering the various parties involved in the tariff project, uh, I'm hoping you can provide, uh, some details for investors about which party is going to take responsibility for each aspect of that project, funding it, designing it.
>> It's interesting. Taking us off the highway for a second.
>> Traffic must be really bad there.
>> Some more details.
>> Yeah. So, we're still working out the um the details of the Terraab uh deployment. Um in in the near term, uh Tesla will be um building the uh the research lab uh on our Texas campus. Um, this is something we expect to be probably, you know, a $3 billionish in initiative. Um, >> there's halib >> and capable of maybe a few thousand wafers per month. Uh, but it's really intended to try out ideas, the research lab. um both both in terms of maybe we have some ideas for improving the fun fundamental technology of how chips are made um and some of the there's some new physics we'd like to test out um but but we also want to test out the ability to um to see if something is working in production. So you need kind of like a few thousand wave starts a month uh to make sure that uh the production process is sound.
Um and and uh and then on SpaceX is uh going to take care of like the initial phase of the the the scaled up terapab um and um >> yeah there >> that's that's what we've figured out thus far over there >> um you know any any kind of intercomp thing has to be approved by both the SpaceX and Tesla board of directors. is it's got to go through a conflict resolution. It's it's going to have a lot of unfortunately a lot of complexity because uh we got to make sure Tesla shareholders are served and SpaceX shareholders are served and strike the right balance there. U so it it takes a while to work through the the kind of independent director uh reviews on on this. So that's that's basically what we've figured out thus far is Tesla's doing the research fab, SpaceX doing the initial part of the large scale terra fab and um and then we got to figure out the rest.
>> Yeah.
>> And what about Intel's involvement?
Uh yeah, so uh Intel has uh decided to partner with us on um the some of the core manufacturing technologies. Um so uh we plan to use Intel's 14A uh uh process uh which is uh state-of-the-art and in fact not yet totally complete. Um so but uh given that by the time Terapab scales up 14A will be probably fairly mature or ready for prime time. Um 14A seems like the right move. Um and uh we have a great relationship with Intel. Um a lot of respect for um the CEO, the CTO and the new team there. Um, so we think it's it's going to be a great partnership.
>> Yeah. And the other thing on the research fab, I think we've said it before, we plan to do memory, logic, everything in the same place, including mask because we want to have a quick iteration loop so that we can see and basically scale the technologies which we're trying to bring up. Yeah, I I think this will be unique in the world or at least I'm not aware of any place where you you have um the lithography mask uh creation the and and then logic memory and packaging in in under one roof in one building.
that that's about the fastest I could possibly imagine doing recursive uh research and development and and being able to try out some pretty radical ideas, some of which have, you know, you know, it's kind of longshot stuff, but if these some of these long shots pan out would be radical improvements in the way chs work.
>> Great. Uh the next question is going to come from Pierre at New Street. Uh Pierre, please feel free to unmute yourself.
>> Hey, thanks a lot for taking my question. Um a quick one first on FSD adoption. So you have 180,000 new uh new users, paying users this quarter and I compare that to your overall install base, it might be 15%. But then if I shrink that to the US or to North America where most of them are, it's probably more like 30 35%.
And I'm trying to and I compare that you you probably sold about 100,000 cars in North America in the quarter. So you're winning twice more uh FSD users and you're selling cars. Um, and then if I add to that picture the fact that I guess it's mostly hardware for uh owners who subscribe to FSD, it sounds like most drivers in North America who have hardware for would already be using FSD.
Is that the right way to think about it?
And the kind of like success FSD is meeting today. Is that is that the right way to think about it?
Yeah, I I think you're thinking about it the right way. And the other thing which I'll share is that uh you know you can't just look at one quarter versus the other quarter in terms of turn but we are actually seeing churn of subscribers also coming down which again is a reflection of the product is getting better and obviously if subscriptions are going up that is a good metric. The other thing also to note is that we are seeing customers actually drive longer which again you could correlate it that's why you have less churn because people are liking the product and if you I mean I've said this before if I just use my own personal behavior right I literally get in the car I press the button and it just goes and earlier I used to park now I don't even have to park and that is the experience which we want everybody to get and that's why you're starting seeing it in the numbers come through.
>> Excellent. Thank you. And if I may maybe a quick followup completely different it's more on the Optimus architecture and you talked about the partnership with XAI and and GR and I I was wondering if you can share with us anything about how the system to um intelligence is going to be implemented.
Is that going to be on board on ships inside uh Optimus or if we should think uh about like a fleet of like a million Optimus being produced a year uh actually driving very significant inference uh demand in data centers as well for for system to thinking.
Uh well, we think we can put a lot of intelligence locally in the robot and and uh and certainly needs to be enough intelligence that if the robot gets uh disconnected like if it's a bad cellular signal or there isn't Wi-Fi, you know, Octopus can't just get stuck. Um it needs to have enough local intelligence that it can still do useful things. uh you know even if it loses the connection kind of like the car like the car does not need any cellular or Wi-Fi connection to be able to drive safely.
Um >> yeah uh I guess you can think of like needs kind of a a manager what to do broadly speaking like if you know otherwise it's going to keep doing the same >> going nuts out here. Um >> that mean >> so you know I think you need kind of a an orchestration AI which uh you know Grock would be good for orchestration um and uh and then for you know for Optimus's voice you know having um a low latency intelligent voice AI croc is actually very good for that. So if you want to talk to Optimus and have kind of a you know a Grock level conversation, you you kind of need to connect to a Grock level AI for for that. Um but uh but I would expect the amount the amount of interaction apart from like you know the voice voice stuff and asking complicated questions of the robot that necessarily needs a a large AI model to answer. Uh the you know Grog would probably have about as much interaction with Optimus as a manager would have with the people on their team.
So meaning meaning Optimus could only work for you se several hours um without any management oversight.
>> Great. Uh the next question is going to come from Dan at Barclays. Uh Dan, please uh feel free to unmute yourself.
>> Great. Uh good evening. Thank you for taking questions. Um Elon, your your chip suppliers generally uh generate pretty good economics on the chip they sell. Um your approach has historically been on vertical integration. Part of that has been to get better economics.
So I know the the longer term goal of Terafab is to get the supply you need, but how much of Terafab is also motivated to get better economics on your midterm chip pu uh purchases? And how long is it going to take to ramp to get to a yield that achieves that type of economic par?
>> Um, no tariff is is not some sort of mechanism for to generate leverage over our chip suppliers. Uh, it's just literally we we don't see a path to having enough uh sufficient quantity of AI chips down the road as we scale production to high levels. um the just the the rate at which the industry is growing um in logic but even more so in memory uh is just doesn't you know we just we just anticipate hitting the wall if if we don't uh make chips ourselves.
So uh that's that's the reason for the ter tariff. Um I think that we do have some ideas for how to make um maybe radically better AI chips. Um you these are kind of research ideas there, you know, which means like uh long shot, but if long shot pays off, it's a maybe a giant improvement.
And um it's just easier to do that if we have our own research lab and and and are developing our own production technologies.
Um so and if you look sort of longterm at you know say having AI satellites um making chips for those there's just there's no just no way in hell the existing industry can keep up with that.
It's impossible.
>> All right. And our next question is going to come from Mark at Goldman Sachs. Uh Mark, please uh feel free to unmute yourself.
Uh yes uh good afternoon. Thank you very much for taking my question. Uh I recognize the importance of FSD and that FSD can help to drive vehicle sales and and see some of the um improvements in the FSD technology more recently with version 14. Um however, I'm also hoping to understand if the company's view on new vehicle models has evolved and I ask given that Elon you posted on X recently that Tesla could develop a family vehicle. There's also been some past discussion about a compact vehicle.
Well, I mean, Cyber Cap is the compact vehicle. It's actually I mean, it's very roomy, but it's a it's a two person vehicle. Now, we do think probably most of our production longterm will be Cyber Cap because 90% of miles driven are with two one or two people. So, it would mean that, you know, you'd want vast majority of your production to be cyber cap. um then um it's over time it's going to make sense for our whole vehicles of different sizes. And I I did talk a bit about this um when we did the uh AI day in LA at Warner Brothers and you know showed like this is our current lineup and this is what you know some idea of what our future lineup will be which is that it's going to be almost entirely autonomous. In fact, longterm time, the only manually driven car will be the the new Tesla Roadster. Uh, speaking of which, we may be able to debut that in a month or so. Um, it requires a lot of testing uh and validation before we can uh actually have a demo and not, you know, have something go wrong with the demo. Uh, but I think it will be one of the most exciting product unveils ever.
Um, I'm not sure. I I don't think it moves the needle massively from a revenue standpoint. So, but it is very cool. Um, I think I think it might be one of the most spectacular demos ever.
And Mark, did you have a follow-up question?
>> Uh, yeah. Thanks, Travis. My other question was on batteries, and the company mentioned batteries as a constraint on its uh growth. Can you speak more to how Tesla expects to resolve this and to what extent that might come from ramping up your own LFP and 4680 battery cell manufacturing or is this something that you'd expect to resolve primarily with increased sourcing from suppliers? Thank you.
>> Yeah. So, at the moment I think the limiter is not the cells itself, it's the battery pack capacity. And you know, we're like I said in my opening remarks, we're actively working on resolving this. There's more capacity being added as we speak and I'll let Lars add a few more things to it.
>> Yeah, thanks. Um, as you guys may have seen in Berlin, we started launching a model Y battery pack with our in-house 4680 cells um, a few months ago and that is ramping up nicely, adding to Berlin's output and helping with the demand surge that we've seen in Europe. as well.
We're adding additional capacity in our Reno facility, sort of retooling it as it's been building packs now for you know almost 10 years and um in order to put in some more efficient lines and get you know additional output out there and then you know we continue to have uh growth at China as well ramping in-house um LF module production and battery packs associated with that. So all of those things are happening now and in in the next months and that's you know really plans we laid out a few months back to increase that that output with the growing demand.
All right, thank you guys. Um and our uh next analyst is going to be Colin from Wells Fargo. Uh Colin, please feel free to unmute yourself.
>> Oh, great. Uh thanks for taking my questions. Um you you moved the safety driver in Austin and you're now expanding into Allison, Houston. What are the key safety metrics that you're tracking that gives you confidence that Robo Taxi is safe enough to expand? Is it sort of miles per intervention, miles per accident, per fatality, and and where do you stand on that now?
>> Yeah, we track basically all the metrics that you mentioned. uh we have a pretty large QA fleet uh spread across all of the United States. Uh and then we uh you know look at uh any intervention that could happen and then sort of simulate uh both in tractor tests and also in our simulators that are very very good nowadays using neural networks as what would have happened and then based on all these analysis we in the end make the call uh to expand uh and so far all of the expansions have gone according to our expectations.
A lot of a lot of the limiting a lot of what limits wider deployment of road taxi are actually not safety issues but uh convenience issues or or the car basically gets paranoid and gets stuck.
Um like sometimes it gets cuz it's it's programmed for maximum safety. So the problem is that then it sometimes just uh gets scared to do things. So like it sometimes gets scared to cross railroads for example or it'll get stuck at uh you know a light where there's uh the light the light never changes from red or I mean there was one kind of amusing situation where a whole bunch of uh rubber taxis got stuck in the left turn lane in Austin because I kid you not a Whimo had crashed into a bus. Um, and so they could not turn left because the way mode crashed into the bus. And so you had this like long line of like I don't know a dozen or more Tesla robo taxis that were waiting for the bus to move, but the bus was never going to move because the way crashed into the bus.
So, so that obviously drives people crazy if there's a whole bunch of robo taxis blocking the whole road. Um, so it's it's a ton of ton of things like that. That's the single biggest thing is is just the car.
>> What?
What just happened?
Oh [ __ ] here. We give it a few more seconds, but let me get ready.
>> Yeah. First I want to say we did, you know, change the cameras some months ago and those are out and the Nitsa flying is referring to like older vehicles. We always work directly with Nitsa um on all the issues that they raise with us and there there's they're asking for quite a bit of information and you know we're complying with that in as timely manner as possible and so um we expect to resolve that and any of the other investigations in in short order.
>> Yeah. Yeah. And we have also implemented stricter measures for the um the visibility of the camera. So in recent software builds, if the camera is not able to see things clearly because of you know residue buildup or what have you um then the FSD won't be available for those cars.
>> It just needs you have to clean the inside of the windscreen.
>> Great. Um that unfortunately is all the time we have uh today. Uh we appreciate everyone's questions and we look forward to talking to you next quarter. Thank you very much and goodbye.
>> So I was wrong.
>> All right. Very interesting call.
What were you wrong about, Meta?
It seems like they think they don't have enough memory on the hardware three chips. Even though I don't know. I think you could still distill it down. Um, I wonder if the fact that they're doing a hard hardware uh discount program, it's almost kind of like an incentive for them to not I I like what are they gonna do with the cars? Are they going to take the cars people trade in and then sell them again?
But this time around if Tesla sells it >> said they're going to have to upgrade all hardware 3s eventually, which makes sense.
>> So you think they're going to bring in all the vehicles that people have and upgrade them, but they won't do it if you don't trade. all going to get upgraded. You just have to make the decision if you want to get a new truck.
>> Yeah, he said which one you want. You can trade it in in another facility specifically to do that, not to congest the the service centers. So, he basically gave all the options that everyone had discussed basically.
>> Yeah. If you have a high mileage hardware 3 car, you're not going to want to dump a bunch of money into it. It'll be far better financially for you to trade in on a heavily discounted AI4 car. That makes 100% sense. Well, heavily >> I totally heavily discounted, right, Josh?
>> Yeah, baby. Let's go.
The the alternative would be it's free, right?
>> Yeah. Transfer it, right? I mean, that sounds like >> No, no. Well, you can just upgrade the current car you have for free.
>> So, it doesn't make sense to pay for mult. I think there's there's a few different things that are going to happen based on their comments on the call which were actually pretty in line with their previous comments even though it like kind of sound surprising the way Elon put it so bluntly. He basically said the same thing before. So we got a comment from Ashok. They previously said FSD14 light is going to come in Q2. Now he's giving us a more exact date of late June which is the end of Q2.
So that's good to hear that from Ashok especially rather than Elon that they think they're going to ship V14 light in June. I think that's going to be super super exciting. If they can get it June, July, August, you know, I don't even care if it's a little late. That's going to be a huge upgra upgrade. So, Hardware 3 is still going to continue to be great for supervised self-driving, but what Elon's saying is I don't think we're going to get it to unsupervised self-driving just due to, you know, some of the memory bandwidth limitations. So, I think we're going to have to do computer upgrades eventually. So, I mean, maybe it will be technically possible to have a model that's unsupervised within that compute budget someday, but it's just a matter of like, do you want to put engineering resources into doing this or do you just want to like upgrade everyone's computer? And it's probably just easier to upgrade everyone's computer. And then he says, "Yeah, hardware 4 looks pretty good. You know, we're even going to um have this uh version 15 of FSD. It's a major breakthrough. We think it's going to be good enough to bring unsupervised FSD everywhere and even that's going to run on AI4. So, we'll be looking pretty good if you get your hardware 3 upgraded to a hardware.
um that provides a little bit of a stop gap between before AI5 and they did say AI5 is going to eventually. But in terms of when these upgrades are going to happen, I don't think we're going to see them happen until after we have unsupervised FSD on customer cars because before you have unsupervised, the cars are really doing much of the same thing. hardware 3, hardware 4. If they're both running V14, the feature set's going to be very similar. AI4 will maybe be a little bit better, but it doesn't make sense to go waste a bunch of money upgrading people's cars just to have it be a little bit better. The other piece of new information that we got, which is exciting, is they're not just going to be upgrading the computer, they're going to be upgrading the cameras as well.
Okay, let me see. I got to kick someone out to bring Sawyer up. Yeah. So, the fact that they're going to be upgrading the cameras as well, that's great news from my perspective. Um, you know, if you think about like a 2022 Model Y and a 2023 Model Y, what's the difference really between them? If you upgrade the computer and the cameras, they're going to be the same from an FSD perspective.
So, that's pretty exciting. And then, you know, needing to set up little factories. I think that's kind of funny.
I mean, there's going to be hundreds of thousands of these cars. I think obviously they want to get people to uh trade in, right? Because they only have to do it for free for the people who bought the FSD package. If you bought the FSD package, you get that upgrade for free. And man, honestly, that $8,000, $10,000 is starting to look like a pretty good deal if they're going to upgrade your car into an unsupervised car at no extra cost.
5,000 2018 >> and um you know some of those cars on the used market, you know, might be looking pretty good. If nothing else, they could maybe get you a discount on a new AI4 car. If not, you know, get upgraded to AI4. So, I think we're we're not going to see that happen until 2027 at the earliest in terms of those hardware 3 to hardware 4 upgrades because first you have to get unsupervised on AI4. Elon said he thinks that might happen around Q4. Add in a little bit of Elon time, it'll probably happen maybe in Q1, 2027.
And then I think in the quarters beyond that, maybe in 2027 or 2028 at the latest, you start seeing these upgrades happen. So if they do start offering free FSD transfer and basically a discount to get a new car, that's a pretty good deal because, you know, it's not just the AI computer that they've improved on these cars. Literally every part of the car is dramatically improved. The suspension is better. The noise isolation is better. The sound system, like >> the screen is bigger and better.
Everything's better. So, >> if you can swing it, I would definitely take their upgrade offer.
>> But for those who don't, um, you know, they'll have to replace the computer and the camera.
>> Yeah, I had to help it out on that one.
>> I upgraded my >> It had the right away from 2.5 to 3.0.
And even that upgrade with an old truck coming through completely faster right there. If you're going to replace the cameras and MCU, essentially basically a brand new car in terms of >> Okay, so it did one bad thing and one really, >> you know, the hardware upgrade, but you have to get a new car.
>> It was having a fit there at that intersection.
>> Did not do any MCU this time though, right?
>> This is This is not uncharted territory for them. Original models did really good have had their cameras upgraded already in the past to the hardware 3 cameras >> and hardware 2 cars have had their computers upgraded to hardware 3. The only difference is now there's a lot more cars. When Tesla was doing the hardware 2 to hardware 3, >> they really need a traffic.
>> Not that many cars. That is >> there are hundreds of thousands of three cars out there.
>> We had the ride away there.
>> Elon had another interesting comment.
You know, I do think it makes sense to actually upgrade all the hardware, >> not just the ones that bought FSD eventually, like replace them robo taxis and those cars are around, then why wouldn't you do it? So, I think it'll probably be a paid upgrade for people who didn't buy FSD in full.
They'll be able to pay and have their computer upgraded. And I think as Tesla gets them as tradeins and stuff, they'll probably, you know, do a lot of the upgrades themselves.
But I I see we got Sawyer here. I know we have a bunch of hands. We'll get to that. But just love to hear your thoughts on the earnings call and anything that stood out to you on the call.
>> Yeah, it was great to get a lot of clarity on a lot of the hardware and FSD stuff. Elon definitely struck more of a I don't know if somber tone is the right word, but more of a laid-back, conservative, cautious approach in his words today. Um, which was interesting.
Last call was kind of the opposite.
It's good that hardware 3 owners are getting some clarity finally on sort of the path forward. You know, he said that he doesn't expect hardware 3 to achieve achieve unsupervised. We kind of knew that based on the Q4 earnings call back in January of last year. He was like, "Yeah, we're probably going to have to upgrade these cars." Which basically meant, "Hey, it's probably not going to be unsupervised." But he's giving a little bit more info on what they actually expect to do. Um it it sounds like it's going to be a while, though.
I'll be honest, like I think earliest next year is probably you're looking at in terms of upgrades. I don't think they're going to want to do anything until they know for sure, okay, this is a hardware we need for unsupervised cuz it sounds like there's even, you know, architectural changes in the software coming for version 15 of the software and then uh it sounds like hardware 4.1 sort of call it is coming, you know, at some in the middle of next year. That was supposed to be AI5, but now it looks like AI5 won't come into the cars until maybe 28, 2028 or if not later.
Sounds like hardware 4 is what all they'll need. Of course, it sounds like there's going to be an upgraded hardware 4 with uh twice as much RAM and, you know, 10% better compute.
>> Um, but yeah, certainly an interesting earnings call. Um, >> yeah, gather my other >> also the capex in increase like going from 20 billion to 25 >> huge announcement there that they expect to be negative free cash flow the rest of the year. I think last year they did yeah 8.5 billion in capex. So they're going from 8.5 to 25. Pretty pretty huge increase. And clearly they're setting up for a huge investment into the future.
>> Yeah. And you know I had uh you know sort of traders and Wall Street people messaging me and going like oh wow this was the big moment on the call where people were like okay wow they're guiding for negative free cash flow for the rest of the year. But if you think about it with opportunities like Roboaxi and Optimus and Terraab, if they're not investing heavily in these for the future at this point, what are they really doing? You know, are they really serious about it? So, it might be a little bit of a tough pill to swallow for the market, but I think they're in a very good financial condition. And honestly, they've they've laid out a capex guide. That's the capex guide you would give if you were planning to raise $75 billion in a monster IPO and then tie up these companies. If you were to do that, then I think spending $25 billion makes a lot of sense. Um, but >> they're wrapping up four lines though, right? That's like Optimus, Semi, uh, row taxi, and then the Terra app. like you have four things that wrapping up and I think it's only taking 25 billion and you I think they're going to be efficient.
>> Yeah, that's a good point. Actually, if you look at some of the other huge capex spenders this year, >> Amazon alone is going to spend $200 billion just on this year. Most of that being AI training >> only had one little snafu to do an accelerated push at the railroad intersection. just Microsoft is a billion but then at that same intersection did a great job with that semi-mport anybody watching my ride along appreciate it and I'll get the robo taxi rides uploaded as well the size of the opportunity
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