Will Tesla Disrupt The Ride Sharing Market?

(NASDAQ: TSLA) may be competing soon with Uber (NYSE: UBER). That's the plan, at least, with autonomous (self-driving) robotaxis at the center of Tesla CEO Elon Musk's long-term strategy. Musk is doubling down on investing in robotaxis and wants to roll out a more advanced model to consumers with no steering wheel, perhaps this summer. The eccentric CEO says that Tesla customers will be able to rent out their Teslas as self-driving taxis to make money, similar to Airbnb.

If Tesla is successful in getting a fleet of robotaxis to market, that could spell trouble for existing ride-sharing networks such as Uber and Lyft. But should investors of ride-sharing companies have genuine concerns about Tesla and robotaxi disruption? Let's take a closer look at the facts.

Tesla is putting an emphasis on robotaxis once again in 2024. During the first-quarter 2024 earnings call, Musk said that in August the company would be unveiling a new vehicle "purpose-built" as a self-driving taxi. In theory, this could present a large threat to existing ride-sharing networks such as Uber. The largest cost to mobile ride-sharing networks is the drivers themselves. If you could operate a fleet of self-driving taxis, that network could undercut Uber (as well as its smaller competitor Lyft) and still generate a profit. This is what Musk is trying to achieve with Tesla's robotaxi strategy.

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Source Fool.com