Tesla Has First Mover Advantages in Autonomous, Says Ark Invest

Tesla Has First Mover Advantages in Autonomous, Says Ark Invest

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A few years ago, Apple missed its opportunity to own the most disruptive and innovative car manufacturer. Tesla would not only be a great investment for them, but would also help them take over extremely important areas of business, but this did not happen.

Yesterday, Tesla CEO Elon Musk said that, in the most difficult times for the company, related to the start of Model 3 production, he approached Apple CEO Tim Cook with a proposal to buy out Tesla. At the time, the smartphone maker was able to make this purchase for only 1/10 of Tesla's current value, that is, about $60 billion. However, Cook turned down the offer, and missed his chance once and for all.

ARK Investment CEO Cathie Wood notes that, at the time, Apple missed out on its chance on reincarnation, which ultimately became an incredible opportunity for Tesla investors.

"Happily for TSLA investors, Tim Cook missed the reincarnation of AAPL when Elon Musk approached him while experiencing 'production hell' with the Model 3. An EV is the ultimate mobile device."

Wood emphasized that Tesla took a cue from Apple's business plan when it developed its own chip. At that time--and still today--there were only a few "level 5" autonomy car computers on the market. However, they did not correspond at all to what Tesla wanted to do.

For example, Nvidia's Pegasus with four chips was large, expensive, and consumed a lot of power. It would take Nvidia too long to develop a suitable chip, which was completely out of line with the timeframe for Tesla's goals. Therefore, the California-based company had no choice but to create its own, one that would be perfect for its own workload.

Nvidia's chips must support a large number of neural network architectures and sensor modalities like LiDAR, while Tesla's SoC needs to support just the sensor suite and neural net on its own vehicles.

Tesla FSD is an automotive-grade computer powered by two custom SoCs (system-on-chips). The SoCs leverage commodity ARM CPUs and GPUs but are augmented by a Tesla-designed neural net accelerator capable of performing 147 trillion operations per second (TOPS)—sufficient for full-autonomous driving.

By creating its own chip, Tesla not only achieved stunning results but also outstripped all competitors by four years. While any other automaker has to wait for a suitable chip to be created, let alone be qualified, tested, and deployed in commercial vehicles (not likely possible before 2023), Tesla owners will instead be able to enjoy Full Self-Driving in the near future.

Wood writes that Apple, as a pioneer in the creation of smartphones, generates the bulk of the profits in this area. But, she is confident that Tesla could do the same in the world of autonomous driving, certainly in the United States, and possibly in other countries.

"As first mover, Apple still generates the bulk of profits in the smartphone space globally. In our view, Tesla could do the same in the autonomous space, certainly in the US and perhaps elsewhere as well."

© 2020, Eva Fox. All rights reserved.


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Article edited by @SmokeyShorts, you can follow him on Twitter

About the Author

Eva Fox

Eva Fox

Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.

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