Tesla has no experience in rideshare. Tesla is a successful manufacturer, but it has no experience marketing or delivering a service such as rideshare.
Musk is betting that he can drive sales and profitability with a new chip that will give Tesla vehicles a full-self-driving (FSD) capability, TechCrunch reports. Notably, Tesla plans to charge car buyers an additional $6,000 for FSD vehicles. Tesla needs the additional income because it reported a -$521.83 operating loss and a -$702.13 net loss for the quarter ending on 3 March 2019. In addition, an FSD capacity could increase demand for Tesla vehicles from high profit fleet buyers. Fleet buyers include car-rental companies, tax companies, ride-hailing services like Uber (NASDAQ: UBER), and government motor pool. Such large volume buyers could make the Tesla Model 3 and Model Y profitable. A rental car company might want an FSD vehicle that drives back to its garage after dropping off a customer, for instance.