logo
Don't believe the hype around robotaxis, HSBC analysts say

Don't believe the hype around robotaxis, HSBC analysts say

Tesla and Waymo are racing to build their own robotaxi empires, but not everyone is convinced the hype is justified.
A new report from analysts at HSBC found that the potential market for driverless taxis was "widely overestimated" and warned that it could take years before robotaxi fleets began returning a profit.
In a Monday note, HSBC analysts suggested that the idea robotaxis would be more profitable than their human-driven counterparts was based on a misconception.
Although robotaxi operators do not have to worry about the cost of paying a driver's wage, they said that driverless taxis face a slew of "overlooked" extra costs that would likely cut into profits.
According to HSBC's analysts, those include parking, charging, and cleaning fees, as well as teams of remote operators to intervene when things go wrong.
"When we factor in these costs, we believe robotaxis won't be break-even on a cash flow basis until 7-8 years after launch," the analysts wrote, adding that projections for robotaxi revenues vary from the "ambitious to the unrealistic."
Industry figures have been making bold claims about driverless cars for years.
Tesla CEO Elon Musk has said that robotaxis will add trillions of dollars to the company's market cap, and in May told CNBC that Tesla would have one million self-driving cars on the road by next year — a promise he also made back in 2019.
Amid the hype, driverless taxis are gradually becoming a reality. Tesla finally launched a pilot of its robotaxi service in Austin last month, and Alphabet-owned Waymo's autonomous Jaguar I-Paces have provided over 5 million paid rides over the past three years.
However, the division of Alphabet that includes Waymo continues to lose billions of dollars a year, and analysts estimate that Waymo's vehicles, which are outfitted with expensive sensors and lidar arrays, cost around $150,000 each.
The economics of Tesla's robotaxis are unclear, but Musk has suggested that the company's decision to use cameras and AI rather than lidar means they are cheaper to run than Waymo's.
Despite this, HSBC's analysts said the automaker faces numerous challenges in scaling its autonomous ride-hailing operation, ranging from regulatory barriers in China and Europe to upgrading the roughly 5 million Teslas on the road with hardware that is too old to run the company's robotaxi software.
They estimated that Tesla's robotaxi fleet would hit 20,000 to 25,000 cars by 2030, rising to 75,000 by 2035, and would not turn a profit until 2033.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Tesla plans 'friends and family' car service in California, regulator says
Tesla plans 'friends and family' car service in California, regulator says

NBC News

timean hour ago

  • NBC News

Tesla plans 'friends and family' car service in California, regulator says

In an earnings call this week, Tesla CEO Elon Musk teased an expansion of his company's fledgling robotaxi service to the San Francisco Bay Area and other U.S. markets. But California regulators are making clear that Tesla is not authorized to carry passengers on public roads in autonomous vehicles and would require a human driver in control at all times. 'Tesla is not allowed to test or transport the public (paid or unpaid) in an AV with or without a driver,' the California Public Utilities Commission told CNBC in an email on Friday. 'Tesla is allowed to transport the public (paid or unpaid) in a non-AV, which, of course, would have a driver.' In other words, Tesla's service in the state will have to be more taxi than robot. Tesla has what's known in California as a charter-party carrier permit, which allows it to run a private car service with human drivers, similar to limousine companies or sightseeing services. The commission said it received a notification from Tesla on Thursday that the company plans to 'extend operations' under its permit to 'offer service to friends and family of employees and to select members of the public,' across much of the Bay Area. But under Tesla's permit, that service can only be with non-AVs, the CPUC said. The California Department of Motor Vehicles told CNBC that Tesla has had a 'drivered testing permit' since 2014, allowing the company to operate AVs with a safety driver present, but not to collect fees. The safety drivers must be Tesla employees, contractors or designees of the manufacturer under that permit, the DMV said. In Austin, Texas, Tesla is currently testing out a robotaxi service, using its Model Y SUVs equipped with the company's latest automated driving software and hardware. The limited service operates during daylight hours and in good weather, on roads with a speed limit of 40 miles per hour. Robotaxis in Austin are remotely supervised by Tesla employees and include a human safety supervisor in the front passenger seat. The service is now limited to invited users, who agree to the terms of Tesla's 'early access program.' On Friday, Business Insider, citing an internal Tesla memo, reported that Tesla told staff it planned to expand its robotaxi service to the San Francisco Bay Area this weekend. Tesla didn't respond to a request for comment on that report. In a separate matter in California, the DMV has accused Tesla of misleading consumers about the capabilities of its driver assistance systems, previously marketed under the names Autopilot and Full Self-Driving (or FSD). Tesla now calls its premium driver assistance features, 'FSD Supervised.' In owners manuals, Tesla says Autopilot and FSD Supervised are 'hands on' systems, requiring a driver at the wheel, ready to steer or brake at all times. But in user-generated videos shared by Tesla on X, the company shows customers using FSD hands-free while engaged in other tasks. The DMV is arguing that Tesla's license to sell vehicles in California should be suspended, with arguments ongoing through Friday at the state's Office of Administrative Hearings in Oakland. Under California state law, autonomous taxi services are regulated at the state level. Some city and county officials said on Friday that they were out of the loop regarding a potential Tesla service in the state. Stephanie Moulton-Peters, a member of the Marin County Board of Supervisors, said in a phone interview that she had not heard from Tesla about its plans. She urged the company to be more transparent. 'I certainly expect they will tell us and I think it's a good business practice to do that,' she said. Moulton-Peters said she was undecided on robotaxis generally and wasn't sure how Marin County, located north of San Francisco, would react to Tesla's service. 'The news of change coming always has mixed results in the community,' she said. Brian Colbert, another member of the Marin County Board of Supervisors, said in an interview that he's open to the idea of Tesla's service being a good thing but that he was disappointed in the lack of communication. 'They should have done a better job about informing the community about the launch,' he said. Google spinoff Waymo, which is far ahead of Tesla in the robotaxi market, obtained a number of permits from the DMV and CPUC before starting its driverless ride-hailing service in the state. Waymo was granted a CPUC driverless deployment permit in 2023, allowing it to charge for rides in the state. The company has been seeking amendments to both its DMV and CPUC driverless deployment permits as it expands its service territory in the state.

Tesla plans 'friends and family' car service in California, regulator says
Tesla plans 'friends and family' car service in California, regulator says

CNBC

time2 hours ago

  • CNBC

Tesla plans 'friends and family' car service in California, regulator says

In an earnings call this week, Tesla CEO Elon Musk teased an expansion of his company's fledgling robotaxi service to the San Francisco Bay Area and other U.S. markets. But California regulators are making clear that Tesla is not authorized to carry passengers on public roads in autonomous vehicles and would require a human driver in control at all times. "Tesla is not allowed to test or transport the public (paid or unpaid) in an AV with or without a driver," the California Public Utilities Commission told CNBC in an email on Friday. "Tesla is allowed to transport the public (paid or unpaid) in a non-AV, which, of course, would have a driver." In other words, Tesla's service in the state will have to be more taxi than robot. Tesla has what's known in California as a charter-party carrier permit, which allows it to run a private car service with human drivers, similar to limousine companies or sightseeing services. The commission said it received a notification from Tesla on Thursday that the company plans to "extend operations" under its permit to "offer service to friends and family of employees and to select members of the public," across much of the Bay Area. But under Tesla's permit, that service can only be with non-AVs, the CPUC said. The California Department of Motor Vehicles told CNBC that Tesla has had a "drivered testing permit" since 2014, allowing the company to operate AVs with a safety driver present, but not to collect fees. The safety drivers must be Tesla employees, contractors or designees of the manufacturer under that permit, the DMV said. In Austin, Texas, Tesla is currently testing out a robotaxi service, using its Model Y SUVs equipped with the company's latest automated driving software and hardware. The limited service operates during daylight hours and in good weather, on roads with a speed limit of 40 miles per hour. Robotaxis in Austin are remotely supervised by Tesla employees, and include a human in the front passenger seat. The service is now limited to invited users, who agree to the terms of Tesla's "early access program." On Friday, Business Insider, citing an internal Tesla memo, reported that Tesla told staff it planned to expand its robotaxi service to the San Francisco Bay Area this weekend. Tesla didn't respond to a request for comment on that report. In a separate matter in California, the DMV has accused Tesla of misleading consumers about the capabilities of its driver assistance systems, previously marketed under the names Autopilot and Full Self-Driving (or FSD). Tesla now calls its premium driver assistance features, "FSD Supervised." In owners manuals, Tesla says Autopilot and FSD Supervised are "hands on" systems, requiring a driver at the wheel, ready to steer or brake at all times. But in user-generated videos shared by Tesla on X, the company shows customers using FSD hands-free while engaged in other tasks. The DMV is arguing that Tesla's license to sell vehicles in California should be suspended, with arguments ongoing through Friday at the state's Office of Administrative Hearings in Oakland. Under California state law, autonomous taxi services are regulated at the state level. Some city and county officials said on Friday that they were out of the loop regarding a potential Tesla service in the state. Stephanie Moulton-Peters, a member of the Marin County Board of Supervisors, said in a phone interview that she had not heard from Tesla about its plans. She urged the company to be more transparent. "I certainly expect they will tell us and I think it's a good business practice to do that," she said. Moulton-Peters said she was undecided on robotaxis generally and wasn't sure how Marin County, located north of San Francisco, would react to Tesla's service. "The news of change coming always has mixed results in the community," she said. Brian Colbert, another member of the Marin County Board of Supervisors, said in an interview that he's open to the idea of Tesla's service being a good thing but that he was disappointed in the lack of communication. "They should have done a better job about informing the community about the launch," he said. Alphabet's Waymo, which is far ahead of Tesla in the robotaxi market, obtained a number of permits from the DMV and CPUC before starting its driverless ride-hailing service in the state. Waymo was granted a CPUC driverless deployment permit in 2023, allowing it to charge for rides in the state. The company has been seeking amendments to both its DMV and CPUC driverless deployment permits as it expands its service territory in the state.

Is there a SpaceX launch today? What to know about liftoff, sonic booms in California
Is there a SpaceX launch today? What to know about liftoff, sonic booms in California

Yahoo

time2 hours ago

  • Yahoo

Is there a SpaceX launch today? What to know about liftoff, sonic booms in California

Looking for something fun to do this weekend? Californians could catch the first Starlink satellite launch in more than a week from the Vandenberg Space Force Base. A SpaceX Falcon 9 rocket carrying the internet-beaming satellites could get off the ground before the end of the weekend, if all goes to plan. The impending rocket launch would be the latest Starlink delivery from Southern California since July 18 and the second spaceflight within a week after NASA sent two science satellites into orbit for its TRACERS mission July 23. Billionaire Elon Musk's rocket company has of late bolstered its orbital Starlink deployments from Vandenberg – providing entertainment to space enthusiasts and angering some Santa Barbara County residents opposed to the increased launches. As you make your rocket viewing plans, though, an important disclaimer to keep on mind is this: Launches can be – and often are – scrubbed or delayed due to any number of factors, including poor weather conditions or unexpected issues with spacecraft. Check back with the VC Star for any updates on the impending rocket launch. In the meantime, here's what to know about the SpaceX Falcon 9 rocket launch from Vandenberg Space Force Base, as well as when and where to watch it: California rocket launches: Here's what's due to launch in July from Vandenberg What time is the SpaceX rocket launch from California? A Federal Aviation Administration operations plan advisory indicates the launch is being targeted for Sunday, July 27, with backup opportunities available the following day, if needed. However, multiple websites dedicated to tracking rocket launches instead suggest the launch window could open as early as 8:55 p.m. PT Saturday, July 26. Neither the Vandenberg Space Force Base, nor SpaceX, have yet officially confirmed the launch. SpaceX Dragon landing: Axiom 4 mission becomes latest spaceflight to make splashdown off California coast Where is the next launch from California? The launch will take place from Launch Complex 4E at Vandenberg Space Force Base in Santa Barbara County, California. Most launches from Vandenberg fly at a south or southeast trajectory. What is the next mission launching from Vandenberg? The spaceflight will make use of the company's famous two-stage 230-foot Falcon 9 rocket, one of the world's most active, to deliver Starlink satellites into low-Earth orbit. The altitude is low enough to allow for things like satellites to circle Earth fairly quickly. How to watch SpaceX Starlink launch livestream SpaceX will provide a webcast of the Starlink launch on its website, beginning about five minutes before liftoff, along with updates on social media site X. Where to watch the Starlink launch in California Because Vandenberg is an active military base, the launch complex does not host public viewings of launches. But if conditions are clear, rocket launches from the Vandenberg Space Force Base can be viewed from several locations as far as Santa Barbara and Los Angeles. Space Launch Schedule, a website dedicated to tracking upcoming rocket launches, provided a list of places in California to catch the launch in person: 13th Street and Arguello Boulevard, the public site with the closest views of SpaceX launches Floradale Avenue and West Ocean Avenue, officially designated as the 'viewing site for SLC-6' (space launch complex-6) Renwick Avenue and West Ocean Avenue, another intersection close to the base where spectators can park Santa Lucia Canyon Road and Victory Road, provides a partial view of Complex 4 The city of Lompoc in Santa Barbara County is filled with places to catch a rocket launch. The city's tourism bureau, Explore Lompoc, even maintains this list with additional viewing locations: , 6851 Ocean Park Road, which, while it doesn't have a view of the launch pad itself, is located only four miles from the launch site and provides a good vantage to see rockets get off the ground. Parking is limited, and law enforcement will close the road to the beach once parking is full. , 1 Hancock Drive, a community college located nine miles from the launch site where both the launch pad and rocket's tip can be seen before liftoff. , N A Street and McLaughlin Road, located within 10 miles of the launch site, is filled with large fields for activities or for spectators to set up chairs. Surf Beach on Ocean Avenue, one of the closest and most popular places to watch rocket launches near Lompoc, as long as it's open and accessible. But a word of caution: There is an active train track, the Amtrak Surf Station, that visitors must cross. While trains don't run during launch windows, the vehicles could start up again with little warning if a liftoff is scrubbed. Will there be sonic booms? Residents of Santa Barbara County, San Luis Obispo County and Ventura County, California, could hear sonic booms, according to Vandenberg Space Force Base. Sonic booms are brief, thunder-like noises that are often heard from the ground when a spacecraft or aircraft travels faster than the speed of sound. What to know about reentry Following the launch, the Falcon 9 rocket's booster will aim to land on a SpaceX drone ship, nicknamed "Of Course I Still Love You," in the Pacific Ocean. This allows for SpaceX personnel to recover the booster so it can be reused in future spaceflights. What is SpaceX? Elon Musk, the world's richest man, founded SpaceX in 2002. The commercial spaceflight company is headquartered at Starbase in South Texas near the U.S.-Mexico border. The site, which is where SpaceX has been conducting routine flight tests of its 400-foot megarocket known as Starship, was recently voted by residents to become its own city. SpaceX conducts many of its own rocket launches, most using the Falcon 9 rocket, from both California and Florida. That includes a regular cadence of deliveries of Starlink internet satellites into orbit, and occasional privately-funded commercial crewed missions on the Dragon. The most recent of SpaceX's private human spaceflights, a mission known as Fram2, took place in April. SpaceX was also famously involved in funding and operating the headline-grabbing Polaris Dawn crewed commercial mission in September 2024. SpaceX additionally benefits from billions of dollars in contracts from NASA and the Department of Defense by providing launch services for classified satellites and other payloads. What is Starlink? Owned by Musk, Starlink is a constellation of nearly 8,000 satellites that provide internet service to customers around the world. SpaceX has spent more than six years delivering the satellites to orbit with a regular cadence of rocket launches from both Florida and California. While most satellite internet services operate from single geostationary satellites orbiting Earth at about 22,236 miles, Starlink is a constellation of thousands of satellites that operate from a low-Earth orbit, about 341 miles up. That allows Starlink's satellites to have lower latency and data time between user and the satellite, improving performance of things like streaming, online gaming and video calls. Residential plans for Starlink services start at $80 per month. Starlink missions: Why does SpaceX launch Starlink satellites from California? What is the Vandenberg Space Force Base in California? The Vandenberg Space Force Base is a rocket launch site in Santa Barbara County in Southern California. Established in 1941, the site was previously known as the Vandenberg Air Force Base. Though it's a military base, the site also hosts both civil and commercial space launches for entities like NASA and SpaceX. Space Launch Delta 30, a unit of Space Force, is responsible for managing the launch operations at Vandenberg, as well as the missile tests that take place at the base. Eric Lagatta is the Space Connect reporter for the USA TODAY Network. Reach him at elagatta@ This article originally appeared on Ventura County Star: California rocket launch today: When, where to see SpaceX liftoff Solve the daily Crossword

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store