Summary

The financial opportunity in self driving is astronomical. As a vertically integrated self-driving car company, Tesla could become one of the most profitable companies on Earth in the long term.

While competitors remain reliant on lidar, Tesla has dispensed with any need for lidar by developing a radar system with superior performance to lidar.

Replicating Tesla’s advancements in radar requires fleet learning. No car company or software company besides Tesla has any experience implementing fleet learning in a production environment.

Since Tesla developed its radar system two years before affordable lidar will be available, and since it has other advantages, it seems likely that Tesla will achieve full self-driving in its production cars one to two years before any competitor.

This will create essentially unlimited demand for all of Tesla’s cars, including the Model S and Model X. It also will enable billions in revenue from the Tesla Network.