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Tesla Has Already Figured Out Trade Strategies To Uber

(Credit: Jeff Swensen / Stringer) Up with its never ending pursuit to expand and be in with modern business potentials, and this time it is with Uber.Tesla Has Already Figured Out Trade Strategies With Uber
October 31
6:00 AM 2016

Uber has captured the startup Zeitgeist in the same way that Tesla did a decade ago and ridden that wave to a $60 billion-plus valuation, while Tesla has to content itself with a mere $30 billion market cap.

Electric cars are just so 2010. In 2016, ride-sharing is the New New Thing, and everyone in the transportation business is trying to figure out if Uber can combine ride-hailing with the New New Things - self-driving cars - and establish a mind-warping paradigm shift.

This is why Uber's debut of an experimental self-driving fleet of cars in Pittsburgh was such a big deal. If Uber can scale that idea, it would have the potential to monopolize on how billions of people worldwide get from point A to point B for next hundred years. Travis Kalanick's startup would rapidly advance beyond being just a tech'd-up taxi service.

There would suddenly be far fewer justifications for owning a vehicle.

Tesla CEO Elon Musk formerly was not all that hot on the whole de-ownership concept for two reasons.

First, it didn't make intellectual sense to him - he saw people sharing their living spaces through Airbnb, but like a lot of people in the car business, he didn't think that widespread car-sharing was going to displace the conventional ownership model.

Second, Tesla is deeply invested in the ownership model. It needs customers to be willing to go into debt to finance its expensive electric vehicles. Even a cheaper mass-market EV such as the Model 3 will require a car loan or some type of lease - customers simply aren't going to have $35,000 in cash lying around.

But Musk is nothing if not adaptable, and he knows that Tesla's decade of mindshare dominance could be coming to an end. Tesla has 500,000 vehicles to build in 2018, and Musk understands that it's not possible to shift away from the premise that Tesla would produce EVs and then sell them - the business model wouldn't tolerate it.

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