Musk refers to Tesla Network as ‘the people versus Uber’
Tesla’s Elon Musk commented on forthcoming plans for Tesla’s rideshare service, Tesla Network, stating the concept is not designed to enrich Tesla’s bottom line, but as a way for Tesla owners to offset the purchase cost of their vehicles. Musk stated during an earnings call on Wednesday: “This would be something that would be a significant offset on the cost of ownership of a car and then a revenue generator for Tesla as well; obviously, the majority of the economics would go to the owner of the car… It’s not Tesla versus Uber. It’s the people versus Uber.” Last week, Tesla announced plans to allow owners to add their vehicle to a “Tesla fleet”, to earn money as their car picks up passengers in autonomous mode when they are not using it.

Tesla CEO Elon Musk briefly commented on the recently confirmed ‘Tesla Network’, Tesla’s upcoming network of self-driving cars as a ridesharing service, during a conference call with analysts following the disclosure of Tesla’s third quarter financial results.

Musk confirmed that Tesla plans to share most of the revenue from the ‘Tesla Network’ with the Tesla owners who will send their self-driving cars on the network to complete rides for customers.

When Tesla announced its self-driving hardware suite last week, it also confirmed its long-rumoured Uber-like service, which we now know as ‘Tesla Network’. Unlike Uber though, Tesla seems to only plan to introduce the service when its vehicles will be self-driving.

While they introduced the necessary hardware in all cars last week, Tesla doesn’t plan for the software to be ready for another year. In his ‘Master Plan Part Deux’, Musk briefly described how he envisions ‘Tesla Network’:

“You will also be able to add your car to the Tesla shared fleet just by tapping a button on the Tesla phone app and have it generate income for you while you’re at work or on vacation, significantly offsetting and at times potentially exceeding the monthly loan or lease cost.”

Today, he elaborated on how he sees the split in revenue between Tesla and the vehicle owners:

“It’s a bit of both really. This would be something that would be a significant offset on the cost of ownership for a car and a revenue generator for Tesla as well, but the majority of the revenue would go to owners.”

In that sense, Musk added that Tesla wouldn’t be competing with Uber, something that as often been brought up recently – especially since Tesla added a fine note that self-driving Tesla owners cannot use their self-driving function to give Uber or Lyft rides – but that Tesla vehicles owners would be competing with Uber:

“This has been characterized as Tesla vs. Uber, but it’s not Tesla versus Uber, it’s the people versus Uber.”

Of course, Tesla is creating the self-driving technology and the network, which will likely take the form of an app, that enable “the people” to compete against Uber with their vehicles. Now Uber is not going down without a fight. While Tesla’s timeline for self-driving capability is more aggressive than Uber’s, the ride-sharing company deployed a test fleet in Pittsburg and it is heavily investing in the technology with the acquisition of Otto.