A few weeks ago, when Tesla Motors founder Elon Musk was talking up the proposed merger of his electric vehicle company with the Solar City franchise run by his cousin, he boldly predicted that Tesla would be the world’s first trillion dollar company.
“I think as a combined automotive and power storage and power generation company; I think the potential is there for Tesla to be a $US1 trillion company, market cap company,” Musk said.
“So, if we play a major role in the transition of the world to a new form of energy generation and storage and transport, that’s what kind of happens.”
Musk’s vision is clear – a future energy system that is a mixture of solar power, stationary storage and electric cars that will power the planet, both for its electricity and much of its transport needs.
“Solar power, stationery storage, electric cars; this is Earth’s solution. And we’re going to try to make that happen as fast as possible and the fundamental good of SolarCity and Tesla will be measured by the degree at which we accelerate that transition so trying to make it happen as fast as possible.
“Everywhere it’s going to be solar battery. There will be some wind, and for some geothermal, hydro and there will be some long tail before the final coal plant finally stops operating and the final natural gas plant stops operating.”
Those comments should not be surprising, given the strength of Musk’s vision, the success of Tesla to date, and his SpaceX venture. And his own high personal stakes in the Tesla and Solar City franchises.
The question that has emerged since then is to what extend that vision is damaged by news of the first death from a driver using the Tesla “auto-pilot” system.
The accident, which occurred more than a month before the unveiling for the Solar City merger, and only came to light after safety authorities advised Tesla they would be conducting investigations into the autopilot technology.
It has sparked a huge polemic about whether this signals the end of the self-drive dream, or is an inevitable, if unfortunate and tragic accident that could make the technology even safer in the long term.
What we know about the accident is that 40-year-old Joshua Brown, a Tesla enthusiast, was driving along a highway in Florida when a big “tractor trailer” pulled out in front of it. There seems to be no doubt that the heavy vehicle was at fault, and the truck had no protection such as side, under-rail guards. This link provides a useful “time-line”.
What is not understood is why the sensors on the auto-pilot system failed to detect the tractor-trailer, and kept the Model S at the same speed and direction before it ploughed into the underside of the heavy vehicle, sheering off the roof and killing the driver immediately.
Tesla has been criticised for not releasing details earlier, and for not putting out a warning on the operation of its auto-pilot, although it does insist that drivers should still be alert and have hold of the steering wheel. (There are reports that the dead driver in Florida was watching a video on his iPad at the time of the crash).
Others say an accident at some time was inevitable, and more such fatalities may be unavoidable in the future. Indeed, there has been a huge debate about how auto-pilot and self-driving technologies will make decisions when faced with the inevitable choice between two objects, when one, but not both are unavoidable. What decisions should a software program be allowed to make. Who does it decide to kill?
Will it halt the rise of Tesla and self-drive vehicles? Not likely. As we have reported, Apple is investing billions in the technology, and so are Google, and other leading auto-makers.
As Morgan Stanley has predicted, the question in the future may not be so much a choice between self drive and auto drive, but whether humans are even allowed to drive if autonomous vehicles prove to be much safer over time.
As one pundit noted, it is possible to write a software program to avoid a repeat of the Florida crash; but it’s almost impossible to teach humans not to repeat the same mistakes that lead to other fatalities.
The auto-industry didn’t stop because of fatalities, although they surely sparked controversy at the time. This wikipedia list itemises some of the first and significant road deaths as first the steam car, and then the internal combustion engine, started using the roads.
It didn’t stop the automobile industry, and still doesn’t, even with more than a million deaths a year across the world. The promoters of autonomous vehicles claim that death toll will be all but eliminated with software at the controls, rather than humans.
For the moment, the investors appeared to have sided with Tesla. After being sold off slightly after the initial reports, the stock has since rebounded, nearly regaining its losses since the proposed merger with Solar City was unveiled.
At $US30 billion, that’s a fair premium for a company yet to turn a profit, and is based on an optimistic outlook for the future. It’s still got a long way to go to $US1 trillion.
Giles Parkinson is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the former editor of Climate Spectator.