Is Tesla’s Future as a Car Company, or a Services Company?

Robotaxi concept idea

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With Tesla’s highly anticipated Robotaxi event just a couple of months away on 8/8, and the Robotaxi itself expected to come to market in 2025 or 2026, the question arises: what is Tesla’s future direction?

Will they continue to produce cutting-edge cars, or will they pivot toward a future where car ownership may no longer make sense?

Advantages of Robotaxi

One of Tesla’s upcoming focuses is bringing the price per mile for its Robotaxi network down to one that rivals bus tickets in major cities. Achieving this is quite an engineering and software feat and something that could still be years away.

But what about the Robotaxi itself? Will the advent of cheap, quickly available robotic taxis in cities and suburbs drive away car ownership in urbanized areas?

Tesla's robotaxi concept

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The potential for Tesla’s Robotaxi service to transform what we currently know as urban mobility is immense. By offering a cost-effective, convenient, and eco-friendly alternative to traditional car ownership, Tesla could change how people navigate cities. The allure of summoning a cheap, quick, and clean Robotaxi could reduce car ownership in cities, alleviate traffic congestion, reduce pollution, and ease parking issues in urban areas.

Moreover, if Tesla succeeds in reducing the price per mile to be competitive with, or even cheaper than mass transit options, the financial incentive to abandon car ownership could become even stronger. For many urbanites, the expenses associated with car ownership – such as insurance, parking, maintenance, charging or fueling costs, and the upfront purchase – can be prohibitive. Robotaxis could tip the balance by providing a seamless, on-demand transportation solution without these additional expenses.

Trust in Robotaxis

Tesla's robotaxi app

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However, there are significant obstacles between Tesla and its rosy Robotaxi future. Regulatory and societal hurdles loom ahead on the horizon. From a regulatory perspective, getting Robotaxi services approved will be a major challenge, as Tesla’s autonomous competitors have found themselves operating in regulatory grey zones. Governments will need to develop new frameworks to accommodate and oversee the deployment of autonomous vehicles, ensuring they meet safety and operational standards.

Societally, people will need to adapt to the idea of letting a computer drive them around. This transition can be challenging; even Tesla has found it difficult to convert those offered the FSD V12 trial into paying subscribers. Building trust in autonomous vehicle technology is crucial for the mass adoption of Robotaxi services. Outside of diehard fans and tech enthusiasts, the general public will need to be convinced of the safety and reliability of autonomous vehicles.

Ensuring that Tesla’s reputation for safe vehicles transfers to Robotaxi and FSD will be essential. Tesla must demonstrate the consistent safety and reliability of its Robotaxis to gain this trust.

Reducing Parking & Increasing Drop Off Zones

Moreover, the presence and availability of Robotaxis required to displace car ownership in urban centers will necessitate substantial infrastructure investment and acceptance by local governments. Tesla has already deployed an impressive Supercharger network, but the scale required for a fully operational Robotaxi network is much larger. This will mean developing parking garages and charging stations in urban centers, located in centralized areas to ensure ease of access for Robotaxis.

Additionally, integrating Robotaxis into the existing urban fabric will require collaboration with city planners and local authorities. They will need to address concerns about traffic flow, designated pickup and drop-off points, and the overall impact on public transportation systems. The seamless integration of Robotaxis into cityscapes will be critical for their success.

In short, while the promise of Tesla’s Robotaxi network is transformative, achieving this vision will require overcoming significant technical, regulatory, and societal challenges. If Tesla can navigate these obstacles, the benefits of a cost-effective, convenient, and eco-friendly transportation alternative could revolutionize urban mobility, reduce car ownership, and contribute to a more sustainable future.

The interior of Tesla's upcoming robotaxi, named Cybercab

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Tesla as a Car Company

Today, Tesla is still fundamentally a car company. It produces five different consumer vehicles: the Model S, Model 3, Model X, Model Y, and the Cybertruck. Of these, the Model Y achieved remarkable success in 2023, becoming the best-selling vehicle in the world, a significant milestone for an electric vehicle (EV). This success underscores Tesla’s engineering and design prowess, demonstrating its ability to create vehicles that appeal to everyday consumers.

Tesla’s focus on innovation and pushing the boundaries has set it apart in the automotive industry. The company revolutionized car manufacturing with its Gigacasting process, which allows large sections of the vehicle to be made from single pieces of cast aluminum. This innovation reduces complexity, increases production efficiency, and lowers costs. Tesla continues to innovate with its Unboxed vehicle assembly process, further streamlining production. Tesla’s vertically integrated approach is unique in the industry, minimizing reliance on third-party suppliers for vehicle subcomponents. This strategy enhances quality control and allows for faster implementation of new technologies. The Gigafactory model, established by Tesla, plays a crucial role in this approach. Located in the United States, China, Germany, and soon in Mexico, these Gigafactories are not just manufacturing hubs; they are centers of innovation. They serve as test beds for updated production processes and vehicle designs and are sites for subcomponent and battery assembly.

Beyond their manufacturing capabilities, each Tesla vehicle is an engineering marvel. Tesla’s cars consistently score some of the highest ratings in safety tests, reflecting the company’s commitment to building safe vehicles. Their performance is equally impressive; for example, the updated Model 3 Performance boasts an impressive 0-60 mph acceleration time. Tesla also continues to push the envelope with forthcoming models, such as the eagerly anticipated updated Roadster, which promises to deliver unparalleled performance.

Tesla has set industry standards in several key areas, including over-the-air updates, battery performance, acceleration, range, and user experience. The ability to receive software updates remotely keeps Tesla vehicles current and continuously enhances the user experience. The company leads in battery technology, offering some of the best range and performance metrics in the industry. Tesla’s vehicles are known for their impressive acceleration and long driving ranges, making them not only environmentally friendly but also highly practical and enjoyable to drive. Furthermore, Tesla excels in providing a superior user experience, both in the vehicle and during the shopping process, with minimalist, high-tech interiors and intuitive user interfaces.

Tesla Challenges

However, Tesla faces significant challenges as it continues to grow. The automotive industry is fiercely competitive, with both established automakers and new entrants ramping up their EV offerings. Companies like Ford, General Motors, Volkswagen, and Rivian are investing heavily in electric vehicle technology and infrastructure, intensifying the competition. There are also upcoming Chinese EV companies making strides in both battery tech and additionally, the global transition from internal combustion engine vehicles to electric vehicles is still in its early stages. Broader adoption of EVs depends on various factors, including government policies, the development of charging infrastructure, and changing consumer preferences. Tesla’s ability to influence and adapt to these factors will be crucial for its sustained growth as a car manufacturer. 

Wrapping it all together, while Tesla is exploring new avenues as a services company, its core identity as a car manufacturer remains robust. The company’s success with the Model Y and its innovative manufacturing practices highlight its strength in the automotive sector. As Tesla continues to push the boundaries of electric vehicle technology and manufacturing, it solidifies its position as a leader in the industry and sets the stage for future growth.

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Is Tesla Planning to Add Steam Support to All Vehicles?

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Yesterday, we reported that Tesla updated their Steam integration on Model S and Model X vehicles. The update was part of their 2024 Holiday Update, but it looks like there may be more to this than a simple update.

Steam, a video game library app, makes it easy for users to buy or launch games on their computers. However, a couple of years ago, Valve, who created Steam, launched their own standalone device, the Steam Deck. The Steam Deck runs a custom OS based on Linux.

Steam Launch

When Tesla launched the redesigned Model S and Model X, Tesla introduced a dedicated gaming GPU with 16GB of RAM and touted the ability to play top-tier PC games in Tesla vehicles.

In 2022, Tesla finally launched the Steam app for the Model S and Model X as part of its 2022 Holiday Update. The Steam app runs Steam OS, the same OS as the Steam Deck in a virtual environment.

However, earlier this year, Tesla stopped including the GPU and Steam (Beta) in their vehicles, and we haven’t seen any updates to the Steam in quite some time. In fact, we thought Tesla was axing their gaming-on-the-go dreams.

SteamOS Update

The Steam app, which is still in Beta, is getting an interesting update for the Model S and Model X vehicles with the discrete GPU.

Those vehicles received an update to SteamOS 3.6 - the same version of SteamOS that runs on the Steam Deck. While nothing has visually changed, there’s a long list of performance optimizations under the hood to get things running smoother.

Comparing Steam Deck to Tesla Vehicles

Let’s take a look at the Steam Deck - according to Valve, its onboard Zen4 CPU and GPU combined push a total of 2 TFlops of data, which is fairly respectable, but much lower than today’s home consoles. The Steam Deck is capable of 720p gaming fairly seamlessly on low-to-medium settings on the go and is also built on the AMD platform.

AMD-equipped Teslas, including the Model 3 and Model Y, are packing an older Zen+ (Zen 1.5) APU (processor with a combined CPU and GPU). AMD claims that the V1000 - the same embedded chip as on AMD Tesla vehicles (YE1807C3T4MFB), brings up to 3.6 TFLops of processing power with it, including 4K encoding and decoding with the integrated GPU on board.

While that’s not enough for 4K gaming or comparable to a full-blown console or desktop GPU, that’s enough raw horsepower for light gaming and is currently more powerful than the Steam Deck.

The Model S and Model X’s GPU brings that up to about 10TFlops of power - comparable to modern consoles like the Xbox Series X at 12 TFlops.

Steam Gaming for All Vehicles?

The fact that Tesla is updating SteamOS even though the feature is no longer available in any new vehicles could indicate that Tesla is not only bringing Steam back to Teslas but that it’s going to play a much bigger role.

While SteamOS is run in a virtual environment on top of Tesla’s own OS, we could see Tesla bring SteamOS to all of its current vehicles, including the Model 3, Model Y, and Cybertruck. Steam in these vehicles would likely support any game that’s capable of running on the Steam Deck.

We think this Steam update, which includes performance improvements and a variety of fixes, has quietly passed under most people’s radars. This could be a very exciting update for those who enjoy gaming, especially for those who love to do it in their Tesla.

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Tesla Holiday Update Weather Features: All the Small Details

Robert Rosenfeld / YouTube

As part of Tesla’s 2024 Holiday Update, Tesla included two awesome new features - Weather at Destination and the long-awaited Weather Radar Overlay. These two features are big upgrades built upon the weather feature that was added in update 2024.26. The original weather feature added an hourly forecast, as well as the chance of precipitation, UV index, Air Quality Index, and other data.

However, this update also added some smaller weather touches, such as the vehicle alerting you if the weather at the destination will be drastically different from the current weather.

Not a Tesla App

Weather At Destination

When you’re navigating to a destination and viewing the full navigation direction list, the text under the arrival time will show you the expected weather next to your destination. You can also tap this, and the full weather pop-up will show up, showing your destination's full set of weather information.

Note the weather under the arrival time

Not a Tesla App

You can also tap the weather icon at the top of the interface at any time and tap Destination to switch between the weather at your current location and the weather at your destination.

You’re probably considering that the weather at your destination doesn’t matter when you’re three hours away - but that’s all taken into account by the trip planner. It will add in both charge time and travel time and show you the weather at your destination at your expected arrival time.

And if the weather is drastically different or inclement, such as rain or snow, while you’ve got sunshine and rainbows - the weather will be shown above the destination ETA for a few moments before it tucks itself away.

Tesla also recently introduced a new voice command. Asking, “What’s the weather?” or something similar will now bring up Tesla’s weather popup.

The weather pop-up above the ETA

Not a Tesla App

One limitation, though—if you’re planning a long road trip that is more than a day of driving, the weather at destination feature won’t be available until you get closer.

Weather Radar Overlay

As part of the improvements to weather, Tesla has also added a radar overlay for precipitation. You can access the new radar overlay by tapping the map and then tapping the weather icon on the right side of the map. It’ll bring up a radar overlay centered on your vehicle. It’ll animate through the radar data over the last 3 hours so that you can see the direction of the storm, but you can also pause it at any point.

You’re able to scroll around in this view and see the weather anywhere, even if you zoom out. It also works while you’re driving, although it can be a little confusing if you’re trying to pay attention to the navigation system. If you like to have Points of Interest enabled on your map, the weather overlay will hide POIs except for Charging POIs.

Requirements / Data

Unfortunately, you’ll need Premium Connectivity for any of the weather features to work, and being on WiFi or using a hotspot will not be enough to get the data to show up. The data, including the weather radar, is provided by The Weather Channel.

As for supported models, weather and weather at destination are available on all vehicles except for the 2012-2020 Model S and Model X. The weather radar has more strict requirements and requires the newer AMD Ryzen-powered infotainment center available on the 2021+ Model S and Model X and more recent Model 3 and Model Y vehicles.

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