Tesla Car Insurance is Part of Monetizing Data on Drivers

Paul Eichenberg, Paul Eichenberg Strategic Consulting, describes how Tesla is using driver data for the most accurate car insurance pricing and they are using cameras and sensors to let Tesla drivers teach Tesla how to make self-driving vehicles.

Joe Langley, IHS Markit, describes how Tesla has taken control of seven challenges to electric car adoption. They have built the super-charger network.

Autoline talks about an even larger surge in Tesla stock price. They mention how the new 12-month target could be $1000 per share.

If Tesla reaches about $555 per share the stock will be worth $100 billion and Elon Musk would get his first $1 billion compensation bonus. Elon Musk would get stock bonuses at each additional $50 billion increase in Tesla market value up to $650 billion.

Rivian got $1.5 billion in funding and has strong support from Amazon and Ford to develop a strong electric vehicle platform.

Hercules is another interesting electric vehicle startup.

There is need for scaling components and integrating more parts. Winners in electric cars will have more integrated parts and more scale.

Volkswagen has made the MEV platform.

VW Group invested $2.6 billion in capital and assets into Argo AI in July 2019. Argo AI is a Pittsburgh-based autonomous vehicle startup that received $1 billion from Ford in 2017. Argo AI is now valued at $7 billion.

VW Group and Ford have a broad alliance that covers autonomous and electric vehicles.

VW placed the Autonomous Intelligent Driving as part Argo Ai. The self-driving subsidiary that was launched in 2017 to develop autonomous vehicle technology for the Volkswagen Group. AID was valued at $1.6 billion. Argo AI is developing a virtual driver system and high-definition maps designed for Ford and VW self-driving vehicles.

There is a surge in alliances of OEMs and car technology companies that need to join to move more quickly.

All of the alliances sound weaker than the position in technologies and scale in electric cars that Tesla has.

General Motors and Ford sell more cars but they each have about $100 billion in debt. Ford debt has been classified as junk by Moody’s. The old car companies are massive slow-moving debt-financed businesses.

14 thoughts on “Tesla Car Insurance is Part of Monetizing Data on Drivers”

  1. While everyone wants an EV, at present they are still an exclusive club reserved for the only for those willing to pay for the vehicle while funding the added R&D costs. We saw this early in the hybrid car market where a limited amount of people were paying $30 to $40k for early an generation Prius that was doomed to battery failure – many of those early adopters never saw a fuel savings payback.

    Since EVs eliminate the petro-burning engine , they share a huge benefit in reduced amount parts and complexity. The reduction in parts and complexity should at some point soon translate to a significant reduction in costs. This is especially so as new far- more-efficient factories come on line and we see an economy of scales like that which we have seen in the Flat-Panel TV market where a 55 inch 4K display went from a retail cost of $25K to $500 (98% reduction in cost). If China starts shipping EVs to the Western markets, then a 50% reduction in EV retail prices would seem achievable.

    One caveat that the EV manufacturers should be cautious of is to not quickly bring too many non-apple-to-apple products to market and risk somethink like we saw years back in the 3D TV and Video industry where consumers altogether lose enthusiasm to adopt the technology because they are baffled by the many new options on the market and their incompatiblilities across the board.

  2. Yes, I thought Fiat and Chrysler were a done deal, but the way they were discussing it seemed as though it was not. Like with the Nissan-Renault arrangement, they seemed to be referring to subjects they’d covered in earlier talks that I have not heard.

  3. If/when the autonomous car fleets pan out as has been predicted, there will also be a drop in personal car ownership and associated demand. That would spell a further reduction in factory workers, if there are any left by that point (not to mention lost driver jobs).

    P.S.: AFAIK, Fiat-Crysler are a single group nowadays. Merged in 2014.

  4. In my case, I have few tasks where I can listen to information-rich audio in parallel. Most of my tasks are brain-heavy, and most of my pass-times are either video or reading, so I can’t divide the attention easily. I suppose I could listen to something while running, but don’t have that habit atm.

    Thanks for taking the time to write a summary.

  5. 12).. Probably, nobody is going to invest in developing a new automotive combustion engine every again. At this point you would not sell enough of them for long enough to justify the costs. (They may mean main-stream engines. I suspect Ferrari or someone would have completely different spreadsheets.)

  6. going to come down once the unions bring themselves to believe what’s going to happen.
    9).On the other hand, a vast new army of software, electronics and data processing workers will be required.
    10).Which brings us to the data issue. This wasn’t dwelled on much actually, just a restatement that Tesla, and to a lesser extend some of the others already in the market, are building up huge advantages in terabytes of user dat, driving data, road condition data, vehicle operations data etc. A vague gesture towards Tesla being able to release their “over the air” performance increases because they have built up the data to be able to safely run their motors harder.
    11). But then this leads to 200 or so new Evs being released on the market in the next couple of years… and no guarantee that they are going to sell. Because right now the world car market is going through a slump (especially China) and the idea that there are 10s of millions of EV sales out there is just a wild, bet the farm, guess. Lots of different form factors, range/performance/cost combinations. Brands. Variations on technology. There is almost certainly going to a harrowing of the options, a big cull of everyone who didn’t guess right.

  7. 6) Nissan and Honda are in trouble. Too small to develop entire EV tech platforms by themselves, not in any close alliance with groups that are big enough. Nissan SHOULD be part of the Renault group but apparently there is trouble there that the group all nodded wisely about but I am out of the loop on.
    7) Jaguar was also mentioned as being in a bad way. As a luxury, Euro car they need to sell in the markets that are going to go EV early. But they haven’t got the tech, aren’t big enough or rich enough to develop it, and don’t fit with any of the big groups that do.
    8) When these companies and groups DO swap over to the EV tech, the auto workers are going to be destroyed. The number of auto workers, the guys in the factories who do the assembly work, is going to be slashed. First of all every time a brand new factory is built, the number of workers/car/day is always reduced. That’s just improved technology. But now you are swapping over to vehicles with DRASTICALLY reduced parts count. From a 7 speed automatic gearbox to… no gearbox. From a quad cam, 32 valve V8 with over 200 moving parts to… 7 moving parts in an electric motor. Even the electrical systems going from 300 km of wire in a 100 kg wiring loom to a bus system with everything done on PCB and in chips. I think they said 90% reduced workforce. GM just lost $2.1B in a strike but that’s just a hint of the industrial war that’s

  8. 3) Most other companies will have to do some as some sort of joint venture, with other car companies and/or with existing electric and battery companies. Eg. Mercedes and BMW appear to be semi-merging with each other and electric motor company to create a series of platforms that they can then tune to give the appearance and dynamics that their particular customers and image requires. Likewise GM with someone (I forget whom) and the French Peugeot-Citroen-Opel merging with Italian Fiat group (and maybe Chrysler? They talked about Chrysler a bit. The value of Chrysler being Jeep, minus the costs of closing the rest of the company down).
    4) Tesla gets to name it’s own price when it comes to deciding who, where and when they merge, joint venture or maybe even take over. So too, to a lesser extent, do any other pure EV companies that actually have runs on the board when the big companies start to get desperate. Rivian was mentioned a lot as a possible.
    5) The Japanese messed up. Toyota was the first to market literally a generation ago with the Prius. Nissan followed with the Leaf. Then… they went nowhere. They bet that fuel cell vehicles, probably fuel cell extenders in hybrids, were going to be it. It wasn’t. Now they have to catch up again. Toyota probably has the size and technological muscle to do this, dragging along all their related half-subsidiaries like Suzuki.

  9. 99% of the time I agree on the video question. TL;DW.

    But this is not actually a video. It pretends to be a video, but the images are just some guys sitting around, so you just treat it as an audio, and so listen while you are doing something else.
    In my case, appropriately enough, repairing automotive electronics. (Well… working on. If it’s actually a repair is TBD.)
    But it is a very good show, and well worth listening to if you are interested in the subject.

    It’s pretty information heavy, and a short summary doesn’t do it justice, but I’ll give the points that stuck out to me.

    1) The car industry is going EV. No ifs or buts. It isn’t even a matter of economics or environment, the simple fact is that legislation already in place, esp in Europe and China, makes it just about impossible to sell cars in 2030 without a big electric selection.
    2) The costs involved are enormous. They have to recreate effectively decades worth of industrial investment over only a handful of years. $10s of billions per platform. Only the biggest of huge car companies have the ability to do this by themselves. VAG is the only one who has actually done this already, with some stupid number like 80 electric models already either released, about to be released, or well under development.

  10. You start two interesting topics, and then veer off into stock price without expanding on either one:

    they are using cameras and sensors to let Tesla drivers teach Tesla how to make self-driving vehicles.

    Joe Langley, IHS Markit, describes how Tesla has taken control of seven challenges to electric car adoption.

    I assume these are in the video, but have little time to watch it. I’d prefer to have a short written summary of the key points.

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