There's actually been startling progress in reinventing the fundamental nature of the car itself — something the industry calls the 'software-defined vehicle,' controlled by just a handful of powerful computers instead of dozens or even hundreds of independent electronic control units, or ECUs. Xinzhou says that moment is basically here.
So I asked Xinzhou pretty directly if Tesla full self driving can actually do what Elon claims it will be able to do without using LiDAR. You tell me if you think his answer holds up.
The biggest threat to Uber is not another ride-sharing company. It's a car company that figures out autonomy and decides to build a consumer brand on top of it. Because if you've got the technology and you've got the cars, you don't need us.
The real magic of Uber is that we have the demand side — hundreds of millions of people who want to go somewhere or get something — and we have the supply side — tens of millions of drivers and couriers. And if you can bring autonomous vehicles into that network, they just become another form of supply. They don't replace the network; they extend it.
The danger with the AV transition is that it's going to be pretty sudden. It's not like, 'Hey, we're going to have 10% more AVs every year.' The technology is going to get approved, it's going to be proven, and I think you'll see a rapid acceleration of AVs into the market.
The biggest risk to Uber is that we get disrupted by autonomy. Because autonomy is going to lower prices. Lower prices will mean more trips. And if we're not part of that autonomous future, we'll essentially be stuck with an ever-more-expensive human-driven transportation service while our competitors will have cheaper and cheaper autonomous transportation.
The insight is that if AV technology works, then every player in the space needs Uber more than Uber needs them, because we bring the demand. We bring the customers. We bring the transaction. And I think we are going to be the storefront for autonomous mobility for the world.
The most dangerous thing that could happen to Uber is if one of the AV companies actually decided that they wanted to be a ride-sharing company, that they wanted to own the consumer relationship and own the driver relationship. Because then you'd have a competitor with a superior technology and they decided to go vertical.
The biggest risk for Uber is that we actually don't lean into AV enough, that we're not aggressive enough in terms of our partnerships, that we're not aggressive enough in terms of building product. Because I think AV is going to happen, and I want Uber to be the biggest beneficiary of AV, not the biggest victim of AV.
The biggest opportunity that we see with autonomous vehicles is actually on the Uber Eats side rather than the rides side, because the driver is such a big part of the cost structure of delivery, and because the consumer experience of waiting 30 to 40 minutes doesn't require a human driver to be present.
The most dangerous thing for a driver of Uber is actually other Uber drivers, because they are creating supply that's competing with you. And the most dangerous thing for an AV company is actually other AV companies. So in a weird way, the interest of our drivers and the interest of AV companies are actually aligned.
The biggest risk to Uber from autonomy is if one of the AV players decides to go it alone and not work with an aggregator like Uber. Because if one of them breaks out and they have, let's say, 30% of the market, and they're keeping that 30% to themselves, well, then we don't have access to 30% of the supply.
I actually think the Waymo relationship is a really good example of how we want to work with AV companies. We want to be the demand side. We want to be the platform. We don't want to own the cars, we don't want to maintain the cars, we don't want to manufacture the cars. We want to be the operating system on top of which AV companies operate.
An eight-year-old today doesn't need a driver's license when they're 16. And I think, going back to your point, it's easy to get in these modes where geopolitical white knuckle moment. But if you look, I think ultimately Tesla autonomous is worth a trillion dollars going to a Tesla story.
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