20M is based on their actual plans. Whether they achieve this is another question. But my money is them executing the plan.
Your disruption point is correct, those 20M cars being bought will be by companies and people buying the cars to generate them cashflow, (think a house you rent out), not to drive for themselves. Tesla covered this in the past but roughly I think the car will produce $10,000+ in cashflow per year to the owner. In this case the ASP likely be a lot more.
With regards to other manufacturers producing cars better & cheaper, I doubt this very much. For many many reasons, but the core reason is engineering speed. They iterating too fast to catch TBH, costs are reducing fast. Look at the gross margins (excluding credits) overtime, it’s almost 30%, this will soon be 40%.
With regards to FSD competition, this is big subject, but in short, MobileEye is closest competitor, but multi-modal models i.e. multiple sensors is actually a flawed architecture. Makes for amazing demos but once you scale up the use its pretty unreliable.
Vision is the holy grail but no-one actually done it yet, Tesla are very close. The new updates to the neural nets over the coming 2-3 months will make FSD almost close to complete, architecture wise not data-wise. It will just be a case of covering the edge cases. It’s a really tough long tail problem. Up until now Tesla have been slowly increasing NNs and deleting lines of code, once NNs fill the majority of the stack the rate of improvement will be quite fast.
A few months back a few 1,000 cars were running FSD, it’s around 60,000 cars now. You can think of this similar to Google PageRank, once you crack the improvement process + traffic = monopoly.
I expect others will crack it too but you need the fleet to get the edge cases, who else has millions of cars with 6 cameras + data running in the world today?
Smart thing to do for autos would be to integrate mobile eye into all cars and follow the same process. But due to poor margins I doubt they will, it’s really innovator dilemma all over again.
