Nice research. This is fairly well known in insurance circles. Most auto insurers that do telematics consider hard braking the strongest indicator of risk. One of the things that we do at work (Cambridge Mobile Telematics) is build tools to deal with this risk. We have apps that monitor driving and we play a tone to indicate that a hard braking event was detected. Simply letting people know that they had a hard braking event is an effective mechanism for behavior change (other companies have similar tech)
Insurance is thinking about hard braking as an indicator of a driver with riskier behaviour. Google is showing that it can also be an indicator of risky road designs. These actually kind of point in opposite directions in terms of the causes of hard braking. The certainly can be used in different ways.
Problem with insurance companies measuring risk this way is that local government externalises costs of bad road design to the people who are unfortunate to have to drive there.
Makes you wonder why there aren't more insurance companies out there using their data to lobby local governments to fix their road design. They have all the data to find hotspots, and reducing accidents would increase their margin.
Maybe this would require an insurance company to have outsized market share in a specific area so they are the main beneficiary of the improvement
It should also be generalize to when (for example a specific corner during dusk or dawn), and for insurers what would also be an important factor would be what other cars are nearby at the hard-braking event, it's not exactly productive to flag the chicken in chicken-or-dare scenario's.
(Though for an insurer, it’s the same thing - whether you’re risky because you’re a bad driver or because you drive on poorly constructed roads or around other poor drivers is inconsequential to them)
Yeah well fuck insurers. We are supposed to get spied upon by our cars with their blackboxes, by our insurers, by Google, by national security services of various countries... and what do we get in return? Dinged for other people's bad behavior which we cannot reasonably control. Either you follow the car in front of you very closely and get hard braking events, or other people switch lanes in front of you and in the worst case slowing down during lane change, provoking yet another hard braking event.
Credit scores are universally hated but they make it possible to offer lower interest rates to more people. Without credit scores, fewer people would have access to credit.
Similarly, people often don't like it when insurers track and score their driving. However, this allows insurers to offer lower insurance fees to more people by _not_ offering lower insurance fees (or instead charging higher fees) to people that are driving in a risky manner. This does of course assume a competitive market for insurance but I think in most countries that's a reasonable assumption.
There's nothing fairer than user-pays, especially when users can choose to pay less by changing their behavior.
> Credit scores are universally hated but they make it possible to offer lower interest rates to more people.
That's probably true in theory, but not in practice, given how high US credit interest rates are compared to European countries for instance.
> Without credit scores, fewer people would have access to credit.
Too many people having access to credit is exactly how we got the worst financial crisis of the century, so it's not really something to brag about… People talk about US public debt a lot, but private debt is even more worrisome.
>There's nothing fairer than user-pays, especially when users can choose to pay less by changing their behavior.
If user pays is so fair why does anyone who could access credit or liquid assets in excess of their state's minimums have to pay hundreds to thousands per year for auto insurance?
Most states allow you to go without insurance by fronting the cash. It's called self-insurance. You put up some minimum amount, file a form with the state DMV, and keep the approval certificate in the vehicle like normal.
It's relatively unknown for individuals because most people have no desire to lock up tens or hundreds of thousands of spare dollars just to avoid car insurance. As far as I'm aware it's primarily used by rich collectors who need to insure large collections that don't fit more traditional insurance profiles. Much more useful for businesses.
>Most states allow you to go without insurance by fronting the cash.
That's BS on it's face. Most states don't allow it or they restrict it to big business and government agencies.
>because most people have no desire to lock up tens or hundreds of thousands of spare dollars just to avoid car insurance.
Most people's money isn't making a return greater than what insurance would cost them.
Second, this completely ignores my point about credit. I can easily get hundreds of thousands of dollars in credit secured against my house or tens of thousands in unsecured credit (credit card). Why must I pay to keep the lights on at some insurance firm?
And I'm not particularly rich. If the numbers pencil out for me then surely they must pencil out for millions of people.
That's BS on it's face. Most states don't allow it or they restrict it to big business and government agencies.
It's 11 states, covering roughly a third of the US population. There's a quite few more if you own significant numbers of vehicles. You can s/most/many/ if it makes you feel better.
Most people's money isn't making a return greater than what insurance would cost them.
You wouldn't be making money on a self-insurance bond either. It's locked up with the state or in a surety account. You can also expect to pay a significant fraction of your regular insurance costs to maintain a surety bond.
Second, this completely ignores my point about credit.
Credit lines expire when you die (say in an accident), they're not guaranteed to pay out the full amount at any particular time, and the courts probably shouldn't go around binding third parties to pay out on your behalf.
States' interest here is in guaranteeing that there will always be a minimum amount of money to compensate victims, regardless of what other financial shenanigans you have going on in your life. That's not a standard that lines of credit and investment accounts meet. Self-insurance is simply a terrible option for most consumers, so no one does it.
That's an entirely separate issue, isn't it? In my country (New Zealand) there are no requirements to have auto insurance. If you don't have insurance and you hit a million-dollar car you're gonna be in an awkward situation, but that's a risk you're allowed to take.
Note that you _are_ legally required to pay your annual ACC levies, which fund no-fault cover for injuries. However that doesn't cover property damage.
This. If you're nearly "perfectly" pricing risk on an individual level then you defeat the point of insurance which is to pool risk.
If my hypothetical cost over an N decade period is within a fraction of a percent of payouts in that time what do I gain by paying for insurance other than creating a principal-agent problem?
Some road designs are risky because they encourage risky behavior. And "risky" is relative. A good driver should recognize risky road segments and drive even more defensively than normally.
This is true - but it’s hard even for “good” drivers to always understand especially on roads they might not be familiar with.
Example: open space on either side of the road, tends to encourage people to drive faster.
Closing that space (whether by buildings, shrubbery, etc ) will slow the speed.
But I will say there are also “obvious” bad designs - the rare far to short on ramp to merge, where drivers don’t understand how to adjust.
Or the one I most frequently encounter are “blind spots” created by the speed of an intersecting road, where a mirror may be attached to a pole / tree, or a sign reminding people to look left right left, or even instructing where cars should be beyond for a safe pull out.
I know of one intersection near me that both has markers on the road(don’t pull out if cars are at or beyond this marker), and a reminder about looking, but still has a high frequency of accidents.
There's some that are purely due to space constraints, favourite pet-peeve example is a highway with an overpass crossing it.
In the rural case, the offramp will branch off first and the on ramp will be after the overpass and the drivers taking each never meet.
In the space constrained case, theres one extra lane that serves both, where the drivers taking the on-ramp cross paths with those taking the off ramp. This configuration is absolutely cursed!
My mom had a device installed in her car to get a discount on her insurance, and she was always upset at the hard braking thing - whenever she did it, it was because another car was doing something unsafe that she couldn't control, like pulling out in front of her.
Some amount of that is inevitable, but there is another level of defensive driving where you anticipate poor behavior and arrange that it won't cause an accident.
Have a look at a few dash cam accident videos [1]. There are many maladaptive patterns of behavior, but a frequent one that the average good driver can improve on is limiting speed on two occasions: when approaching a blind spot, and when passing stopped or slow traffic.
That second one gets lots of otherwise good drivers. They seem to think that by limiting their speed vs slow/stopped traffic they'd be encouraging people to dart in front of them. Which is somewhat true. But with limited speed, that's an avoidable or less injurious accident. By gunning it past stopped traffic, you make the accident unavoidable and more serious.
Without wanting to paint with too broad a brush, I would say in my experience driving in 10x countries, U.S. drivers, being most habituated to spending their lives in cars, drive in the most distracted, least careful way. Especially in places where the typology is the U.S. default of low-density, car-oriented sprawl. Accordingly there are an appaling number of deaths and injuries on the road: 1 in 43,750 people dies each year in the U.K. in automobile accidents vs. 1 in 8,500 in the U.S.A.
Inb4 deaths per mile driven, I'd argue higher VMT in the U.S.A. only proves the point - too many cars being driven too much because of silly land use. High VMT is acutally a symptom of a dangerous mobility system as much as a cause.
Add to that the relative ease to get a license in the US, and the level of punishment for breaking the laws.
I (an American) was on holiday and Switzerland and was explained the process of getting your license back if you lose it. It is a big disincentive to driving badly and putting yourself at risk of that, to be sure.
Adding on to this, a common reaction I see to online videos of driving incidents is "why did this person just stop? of course you are going to crash into them. They shouldn't have stopped" and many people agreeing with it. It seems they are blind to the fact that if the following driver was using a safe following distance and speed, they should easily be able to stop, making the incident the fault of the driver following too close, not the one stopping.
I haven't checked on this in a long time, but IIRC, the insurance company will always blame the person in back in a rear-end collision, for just this reason. A rear-end collision should always be avoidable.
Usually but not always. A common insurance scam is to pass a car, cut in just in front of it, then brake hard causing a collision. Dash cams video is a good thing to have to fight this if it happens to you.
No, even then. If a car cuts in front of you, you have at least a few seconds of time to start making space for them, and once they are in front of you, you should immediately make a safe amount of space between you and them.
Yes, in a country where safe driving is not internalized you will inevitable have someone rear-ending you while doing this, but if the options are "accident where you're at fault" and "accident where you're not at fault", pick the latter.
Some degree of road safety depends on predictable behavior. I haven’t seen those videos, but suddenly executing a panic stop on the freeway for no good reason at all increases everyone’s risk, even if the car behind you is following at a safe distance. Obviously the following driver bears the most responsibility, but erratic drivers shouldn’t be held to be morally blameless.
People don’t usually act erratically for no reason. Maybe they suddenly stop because they see a deer sprinting towards the road off in the distance, and the person behind them didn’t see it. There are tons of reasons that look like they “erratically stop”, which are actually genuine safe behavior that the other may not know about.
I learned next-level defensive driving by bicycle commuting to work 5.5 miles each way on busy roads in rush hour traffic. On a bicycle you're invisible, and if you expect any less, you're going to get hurt. As it was, I had some very very close calls- at least one of them had the potential to be fatal. Ironically, the only time I ever crashed was my own fault.
But now even when in a car, I retain that "I'm invisible" mentality, which makes me much more aware of what other drivers are doing, and much more skeptical of their ability to make good decisions. This has saved me several times.
The landing page video's first incident is a car coming from behind and from the right, cutting off the filming car. The filming car didn't react at all when instant (but measured) braking would've been safer to start building a distance buffer.
One thing HPDE taught me is that most people under brake in dangerous situations because they simply don't know the limit of their vehicle nor the sensitivity range of the brake pedal.
The hard braking heuristic makes sense when estimating risk of road segments, but not as a proxy for driver competence.
It certainly makes sense as a proxy for competence across a diverse population for insurance purposes. You have a baseline of hard braking events that a competent driver may encounter under normal circumstances. If a driver routinely exceeds that number, they are either unable to correctly estimate closing distance and reaction times, which makes them higher risk for causing accidents, or they are driving abnormally aggressively, which also makes them a higher risk for causing accidents. If you consistently put yourself in situations where hard braking is required, it doesn't matter what your skill is, you've reduced your safety margins and an accident is statistically more probable. You said it correctly with "would've been safer to start building a distance buffer", that is the proxy the insurance companies want to use for risk assessment.
35 years without an accident on my record isn't because I'm a magnificent driver, it's because I always try to leave a way out for when something unexpected happens, because the unexpected _does_ happen.
The fact that some people may have the skill to drive more aggressively means nothing in the aggregate as far as insurance companies are concerned. If you are skilled enough to drive in that manner, you are skilled enough to avoid it as well. It's simply statistics.
> You said it correctly with "would've been safer to start building a distance buffer", that is the proxy the insurance companies want to use for risk assessment.
Then use it? Mandate reaction speed tests or other driving mechanics competency evaluation (not road sign comprehension) and watch insurance margins explode.
The driver in my example did poorly and scored top marks in the heuristic.
> building a distance buffer", that is the proxy the insurance companies want to use for risk assessment.
The cam car did not need to have a hard braking event (HBE) to start building distance.
Even if they did, the insurance companies are looking for a pattern of HBEs to assess risk. I agree that there is a theoretical high-risk driver that never has a HBE because they always try to maneuver instead of breaking. There are other heuristics for this (high lateral acceleration, high jerk). And the ultimate heuristic: failing to avoid accidents, thus having a claim history.
> One thing HPDE taught me is that most people under brake in dangerous situations because they simply don't know the limit of their vehicle nor the sensitivity range of the brake pedal.
On any modern car, just push it all the way and let ABS and stability control figure it out, and don't let the vibrating brake pedal spook you into releasing it. That's just ABS doing its thing.
Really though, getting a license is too easy in the USA. We really need to require some sort of car control course, including obstacle avoidance in the rain. Would be really nice too if it included an obstacle avoidance course in two cars: A huge SUV or pick-up truck and a more reasonably sized sedan. So many drivers think they need a huge vehicle to be safe while being completely unaware of how well smaller cars can likely avoid the crashes to begin with. Would probably get really expensive really quickly, though.
One thing I noticed among dash cam videos is very often the person recording and publishing the video will keep on driving closely behind another car that is clearly driving erratically. Maybe he will honk, but he won't brake or leave any safety distance, and seconds later the idiot's car, which has been behaving weirdly in front of him the whole time, causes him to crash.
I realize this may come off as victim blaming, but I feel you should have an obligation to not endanger yourself even if by the laws of the road you are technically in the right. I would rather get cut off by and idiot and be at my destination thirty seconds later than having to deal with car repairs even when it is legally speaking not my fault.
If you take a seasoned motorcycle rider and put them in one of those dashcam subs, they'll rip their hair out.
Most people have near zero defensive driving skill, and view someone pulling out in front of them as "nothing I could have done", when the dashcam shows the offending driver showed 5 signs of pulling out ages before the accident occurred.
At one point in my life I rode a bicycle 40+ km per day. I see things nobody else seems to and I think that has a lot to do with it. I cannot win the collision.
Much of being a good driver is just awareness.
One time my light turns green, I don't go. As my wife asks what I'm waiting for, a pickup blows the light. We weren't the first car at that light, and years later she still talks about how there's no way I could know. Well, I didn't get us t-boned at 80 so I must have done something right.
I'm definitely a better driver because of bicycling. You gain new skills when you know that you're going to come out the loser in almost every collision.
Very true. There is a "body language" to driving. I can often predict when someone will change lanes before they ever turn their signal on (if they even do that) by the way their speed changes and they drift a bit in their lane as they shift their eyes to their mirrors.
Drivers often believe that their insurance rates should be based solely on whether they follow driving rules, but the risks to insurance are not isolated to this. Someone can follow every rule perfectly, but if they are involved in an accident they incur costs for their insurance company.
First, the insurance company incurs costs just processing the claim. If things escalate with the other party, they may even incur legal and court costs.
Additionally, there are some costs that are incurred regardless of fault -- like personal injury protection.
Even defining "who was at fault" is a complicated situation. A lot of people presume that it is as simple as: whoever the police issues a citation to at the scene is 100% at fault. But that's not the way things actually work. The way liability is assigned depends on the state, but in a comparative negligence state you could be proportionately liable for as little as one percent of the fault of the accident. Maybe someone else ran a red light, you entered the intersection on green, and hit them. You could end up sharing some of the cost for that, if it is found that you could have avoided the accident but decided not to.
And even after all of this, if the other party runs out of money, doesn't have insurance, or runs away at the scene, your insurance company is stuck paying the costs under their uninsured/underinsurred motorist coverage.
It does cost them just to process the claim because the other guys side is unlikely to completely roll over if there is any chance to reduce the payout. Obviously its not as much as the claims themselves but it also isn't free.
Yep. I have a friend that was plowed into from behind while waiting at a red light, twice within a few months time. Two separate intersections. Totaled her car both times. Her insurance rates went up, even though she was clearly not at fault.
"Not at fault" as far as the law is concerned, is a low bar. If you're one of the last cars in a queue, you should be checking your mirrors for exactly this scenario. Throwing your hands up in the air saying "well the law says I did no wrong!" isn't the way. Unless you like getting into accidents.
Also, having two of the same type of accident twice in such a short time is so improbable, that I'm seriously doubting your friend. I'd say it's way more likely she braked too suddenly or has other bad driving habits that make such accidents more likely than that she got this unlucky.
I hate the warning myself and I use the app the parent is from. I also suspect I am an outlier in not having an accident in 20 years.
It’s this obnoxious audio warning that tells me I had a hard breaking and it’s 9/10 because I stopped at a red light that I would not have made on yellow. And then it sends me tips and reminders about reducing hard breaking events and it’s annoying. I know they have done the analysis but it detects moderate hard breaking which is frustrating. One of those things that I am sure in net is positive but perhaps slices of the population it does not benefit.
No doubt but I think it’s two fold. Lights stink in that so many are setup not for safety so they rip through the yellow quick as possible. Second, I don’t think of these as hard breaking even but I am sure from a data perspective the cutoff is probably correct. Hard invokes a vision of an emergency brake event. These apps really capture any medium to hard brake event.
> Simply letting people know that they had a hard braking event is an effective mechanism for behavior change
Has this been studied in isolation? Many of the tools that notify upon hard braking also are used to impose financial penalties for doing so... I suspect people may be reacting to the financial incentives.
Yep. We work with CMT and we’ve both done extensive testing on this. I think that often people don’t necessarily know what a hard braking event actually means, or how it’s quantified. Giving that realtime feedback helps close that gap in understanding
When people learn to do things by reacting to inputs, they learn much better when the input comes soon after the action/inaction they are trying to train, rather than long after. When you can tie specific acts as a driver to a later financial penalty it helps you learn to avoid the specific acts, otherwise you'd stuck having to figure out in three weeks when the bill comes around what you were doing on the date the insurance statement flagged as a hard stop.
Anecdotally: I leave the fuel efficiency display as the instrument cluster display on the hybrid that I drive and it significantly changes both my acceleration and braking behavior.
There is a minor financial aspect (price of fuel), but I’m far more interested in seeing if I can get a better “green score” at the end of the drive.
Does it matter why? The important part is getting people to change behavior.
of course if they change such that they don't break hard when needed that is bad, but if the change such that they don't need to break hard in the first place because they slow down in places that are dangerious that is the point.
When you modify their braking behavior, is that enough to improve their overall driving behavior? Or do forward collisions and rear-enders make up substantially all of what the driver can control, so training the behaviors to reduce that type of near-miss reduces the driver's overall crash risk? To the point that it's similar to the safest tranche?
Is it that hard braking events are broadly indicative of surprises of lots of sorts, and so it happens that the only way to eliminate them all is to develop a full range of defensive driving habits?
Regardless of everything else, forward collisions are most likely to have the driver considered at-fault. Seems like reducing those in your insured population would reduce covered losses more than reducing collisions where your insured may not be at fault.
> Is it that hard braking events are broadly indicative of surprises of lots of sorts,
Of apparent surprises to the driver. And since actual, factual surprises are extremely rare, if a driver is regularly being surprised, they're a bad driver.
How does one not already know that they had a hard braking event? Surely the jamming their foot on the brake pedal and the rapid deceleration would send an even more obvious signal than playing a chime?
Obviously people know, but theres no impulse to introspect on why or how. Knowing that someone else knows you had a hard braking event taps in to our social brains to provide a much stronger response to the event. When we know people are watching we're more likely to try and justify our behaviour.
Have you used one of these apps before? They capture a lot more than emergency stops, what I would classify as the above normal brake effort but not hard braking. Im sure the data exist to set the cutoff but its a lot more than “jam your foot on the pedal braking”.
It’s still out of the norm braking for my style of driver but from what I see on the road, people drive aggressively like this. Especially in the US.
If you don't want to go through your insurance company you can check out an app we built called RoadClub. You get points for safe driving behavior - and you can get the hard brake alerts. Is it a bit annoying? yes. You can't just drive agressively - you need to give space to slow down. I still struggle with it.
I know way too many drivers who have exactly two modes: Full brakes and full accelerator. Like, they'll see someone in front of them, slam the gas pedal, and then when they get too close, slam the brakes to slow down. No in between. And they don't even know they're terrible drivers since they've always driven this way.
> We have apps that monitor driving and we play a tone to indicate that a hard braking event was detected. Simply letting people know that they had a hard braking event is an effective mechanism for behavior change (other companies have similar tech)
... How do people not notice that they are braking hard?
Because their definition of hard is not a slam on the pedal braking. It’s definitely out of the normal stopping but it’s not as hard as you might imagine. I could easily see people not realizing this.
I am confused about what Tesla is doing. They have effectively two automobile products now with one failed product (cybertruck). reading various articles about this doesn't make it more clear. Do they not want to be a car company?
The problem with being a car company is that they'd have to compete with China. It's possible, but they'd have to make additional capital investments to keep up. They've just wasted a ton of money on a failed Musk vanity project (Cybertruck) and squandered a ton of goodwill in their home market via the DOGE fiasco. Cash flow is not what it once was, and if they're going to make a big capital investment, they're probably right in looking at robots. But that strategy puts them back where they were 20 years ago, just getting started in EVs, and their cash flow will depend on cars for many years to come.
If the problem with being a car company is that they'd have to compete with China, then I have some bad news about being a robot company. China is already farther ahead in both technology and volume of humanoid robots.[0][1][2][3]
If you think of Musk companies as vehicles to extract money from state and federal governments, then everything falls into focus. Carbon credits, government launches and the Quixotic quest for Mars, and soon Tesla robots sold to the DoD and DHS. I'm only half-joking.
Fair point. It's hard to support Tesla's valuation as a car company, it may be even harder to support as a robot company. You have to wonder what might have been if they'd spent that Cybertruck money on battery research.
Market cap and it's not even close. Turns out financialisation is the classic you-get-what-you-asked-for-not-what-you-wanted of capitalism. We told the optimiser to make number go up, and number has certainly gone up. China's number? Not as up.
I think it could have gone differently if we gave our economic system something to optimise other than itself, but then we wouldn't have centibillionaires, so... swings and roundabouts I guess?
Who cares which country has a higher market cap? That's a capitalist concept, of course the capitalist country has more. I'm talking who has the more advanced technology.
That was the point. We optimize for a higher market cap instead of for advanced technology, that is way why get a higher market cap instead of advanced technology. The system is working as intended. Goodhart's Law all the way down.
China is a mixed economy with some capitalist parts and some socialist parts just like us. Their mix is just a bit more effective than our mix than our mix and they have higher scale.
It's more effective at depressing wages and at shovelling other people's money at whoever the politicians want to win. They are also much better at hiding debt -- in manufacturing companies, in banks, and in provincial governments. A lot of their successes lose money but they are awesome at hiding it and they might well outcompete Western companies and thereby cause a lot of harm.
What do you mean “hiding it”? Are you suggesting Chinas manufacturing capacity is entirely fraudulent or cooking the books? Or that the state is providing subsidies? Because if its the latter… have you seen the brouhaha over Amazon HQ2? Or seen the number of tax credits/incentives doled out by US cities to companies that “promise” jobs but don’t even deliver them? (but keep their subsidies).
China is capitalist on a state level, that's where they are winning. The US lets things get mired in red tape and special interests because nobody wants to take responsibility for growth.
In China, I imagine that if your company does something relevant to the five year initiative then you get a lot of red tape cut for you.
> China is capitalist on a state level, that's where they are winning. The US lets things get mired in red tape and special interests because nobody wants to take responsibility for growth.
i.e. in China, the government controls capital; in the US, capital controls the government.
> CPC controls and owns production, policy, finance and even consumption levers.
These terms are useless for distinguishing anything -- what you said can be said about literally any capitalist state.
> China is one party system
This is also relatively uninteresting. There have been many countries where a single party has nominally remained in power for about as long as the CCP has. That Deng Xiaoping's coup occurred without nominally dismantling the party makes the "one party system" distinction a superficial one.
> These terms are useless for distinguishing anything -- what you said can be said about literally any capitalist state.
CPC mandates and gets seats on highest boards of companies, combines IP research across civil military, is both producer and consumer of products etc. Look at China's civil military fusion policy on the latest iteration of how they are doing this. In china there is no separate 3-4 branches of govt like in most places. CPC controls all legislative, executive, judiciary, military and private company boards and financial capital.
Again, just about everything you said applies to the U.S. state and its relations to private firms. Regardless of all that, profits accrue to private owners, investment decisions are determined by profit, and labor is hired and disciplined via market relations. All of the political relations you listed only marginally modify capitalist relations; the law of value still operates.
One emperor in US state doesn't control legislative, executive, judiciary, military and private company boards and financial capital. The way you have to look at China it is an empire with bit of communism and capitalism. If the mandate of heaven is favorable emperor controls everything, otherwise power diffuses a little among the emperor coterie.
Making good cars. They can make cheap ones, maybe acceptable ones, but not good ones. They are not there yet. Of course, the general populace doesn’t really care, and the vast majority of the market is not driven by this, but still.
It seems counterintuitive, but this helped Tesla which is why Musk championed it. Basically when that tax credit came out, a bunch of Tesla owners had their cars underwater - loans were more than new cars were selling for and depreciation thru the roof. Plus the tax credit helped their competitors. Now that the credit is gone, Tesla owners are closer to being in the black on their cars and it also caused Ford and GM to cut EV production by I believe 100%. Win win for Tesla.
> It seems counterintuitive, but this helped Tesla which is why Musk championed it. Basically when that tax credit came out, a bunch of Tesla owners had their cars underwater - loans were more than new cars were selling for and depreciation thru the roof. Plus the tax credit helped their competitors.
This makes sense if your business strategy is to get existing Tesla owners to trade their current Teslas to buy new Teslas, rather than to convert non-Tesla owners to buy new Teslas. The latter market is WAY bigger and the tax credit was a huge carrot enticing them to look at a brand they'd never try otherwise in a market where ICE vehicle prices were skyrocketing.
As it stands, there are a ton of Tesla owners who bought their cars with the tax refund, are underwater on them, bitter about it and/or dislike Elon personally, and will never buy a Tesla again. This is churn and brand destruction without a corresponding top of funnel increase.
In contrast, the supercharger network was significant not just for the convenience factor for Tesla owners, but also for the fact that it was a social signal that Tesla was serious about growing the addressable market of EV owners generally by not just making a decent car but making the "EV lifestyle" seem possible to non-EV owners.
If Tesla actually is happy that the tax credit is going away, that seems like they're acknowledging that they're satisfied taking shrinking share of a shrinking market, which is their prerogative, but it's a bad business.
If your existing owners have made a "profit", or at least lost less to deprecation than normal, they're probably more willing to buy a new car from you (trading or selling their existing one) even if that new car is more expensive and they're actually paying just as much to upgrade as they would be anyway.
Of course, it's 4D chess. This was such a genius move that Tesla profits fell 46% last year and they are ending production of their highest-margin vehicles.
GM wrote down $4B when they reduced their EV production. Despite that, last year GM sold half the number of EVs as Tesla did. If THAT was reduced production by 100%, then Tesla would have been truly fucked had Harris won the election.
Tesla is suffering because Elon Musk was a genius at some point in the past. Then, he got into ketamine and fried his brain.
The cars are expensive, have QC issues, and are facing steep competition from the rest of the world. Tesla's attempt to build an F150 competitor was a disaster, Optimus is years away from being useful for anything, and after 15 years of "We'll totally release FSD this year!" the market seems to finally be realizing that it's not going to happen for a little while.
It really sucks to see a perfectly good company get blown to smithereens, but shareholders did choose to bet on the man.
The problem with being a car company is that they'd have to compete with China.
As if China cannot produce kick ass robots ? What special sauce does Musk have here that a country with a massive pool of highly trained and educated engineers and decades of manufacturing expertise don't have?
I would bet that as soon as someone "solves" robots. China will relatively shortly, that is months or few years produce something that surpasses them. They have all the pieces and all the capabilities. Just look at drones for example. It just requires correct solution and China might even be first to provided that.
I'm sure China can. But nobody is producing consumer humanoid robots at any scale yet, so Tesla can at least make the argument that they'll make better robots when people actually start buying robots. People are buying cars at scale right now, and existing Tesla models have fallen behind their Chinese competitors.
Another 10 years and maybe they will have sold as many as Sony sold Aibo robot dogs. You're making my point---it's not a significant market, and won't be for many years.
Looks like they took Peter Thiel’s animosity towards competition too literally by blocking BYD from the US market. Without competition, they had no incentive to innovate since they were selling into the wealthiest market in the world for their product, the US.
No innovation made them stagnate. Being blocked from the US made BYD innovate.
Elon generated goodwill with DOGE among a group of people. He then alienated them during a public spat with the president. This is also a president who has decided to make EVs synonymous with the opposition political party.
Nobody's buying EVs in the US since the subsidies expired. GM had a record Q4 because it gave up trying to sell EVs and started flogging expensive land yachts again.
Elon's a strange hero for MAGA. All the hardcore rural MAGAs I know hate Elon. They consider him a rich dickhead nerd (and group him with Gates) and they hate EVs with a passion, since they are quiet and produce no black smoke.
Automotive stocks are subject to the rules of gravity, aka "boring", while tech stocks are not. Automakers operate on low margins and high volume, and must compete on price, reliability or luxury brand status. Most automakers have multiple brands to sell to all market segments.
Tesla's value proposition was that it was going to be an iPod in a world of identikit MP3 players, and charge a premium for it. One brand to rule them all, no pesky dealerships, with futuristic EV tech and a touchscreen dash that made gas-powered, tactile button-laden cars obsolete.
That was twenty years ago. Tesla went from leading the pack to struggling to achieve scale, with its limelight-seeking leader increasingly holding it back. The leader wants headlines for pioneering "cool shit" and pushing hype to pump the stock price. Buyers on the other hand want affordable and timely repairs (impossible with their resistance to third party body shops and unit cost of replacement parts). As a mature company, it is completely un-equipped to compete with the incumbents whose leaders, not by coincidence, are all largely unknown to the public.
> Tesla's far more popular models are the 3 and Y, which accounted for 97% of the company's 1.59 million deliveries last year. The Model 3 now starts at about $37,000, and the Model Y is around $40,000. Tesla debuted more affordable versions of the vehicles late last year.
I’m confused as to what’s not clear from the article for you?
Agreed. I also thought it was a very dumb move until I saw that. That said, 3% but it costs 2.5x as much, maybe people option them higher idk, that could be a 10% revenue hit. But maybe that's worth it for them
If they just canceled the S and X I don’t think people would be making quite as much fun.
Saying they’re dropping two products that aren’t profitable so they can make a new product that most people seem to think is a complete joke is the problem.
Apparently Tesla dropped 4680 battery production for the CT by 99%, so the CT isn't long for this world either.
But that's okay! They have the Cybercab that will 100% drive itself For Real This Time, $99/mo Autopilot/FSD subscriptions and robots that will theoretically wash your dishes in an age where most people have an adversarial relationship with anything AI, so.
I'm not disagreeing with your overall take, but Tesla and other EV manufacturers have released the same model of vehicle with different battery technologies at different times. Only saying that dropping 4680 production isn't conclusive proof itself.
Check out videos of Chinese car company factories. They are far more automated and futuristic than Tesla’s. Most of the new ones have almost no humans in them at all. They have great supply chains and partners for everything that is an input into these factories, and they’re often just up the street from the car factories. The costs are rock bottom and the competition between car companies in China is absolutely bananas.
Ignoring who makes it, this kind of gimmickmobile usually sells well for about a year, and then everyone who wants one has one. It was never going to be a tentpole.
Humanoid robots make sense in only one context I can think of, and I definitely wouldn't put it past Musk to enter that market. It will be a big one. He may just be waiting for material science to catch up with his product vision. Much like Steve Jobs waited by the river until capacitive multitouch came floating by, and then pounced on it.
Meantime, as others have pointed out, the Model S and X are not selling enough to justify keeping the factory running. I don't see them going into Optimus production immediately, since as you suggest it's a solution looking for a problem.
If you’re beating around the same bush, I think the material science is already there. It’s more the power draw and the societal blowback that are issues. It is an underrated market, but not a >1T$ market (I hope).
About a decade ago, Musk said he wanted to kickstart the electric car industry, make electric cars cool by showing they can be high performance and promising not to enforce Tesla's patents against competitors. Remember how electric cars used to be perceived? The Simpsons put it as "people will think you're gay". I'd say he completely succeeded in that goal and the whole "make piles of money for investors" is just because investors decided to try doing that.
I would. Someone in the market for a presumably profitable BMW 5 or 7 series isn't going to stay with BMW and drive a 3 series.
Yearly sales of model X have been comparable to the 5 series, at least until last year when musk's political activities took the shine off the brand.
High end cars are more profitable. There are millions of 3 and Y owners with positive experiences who would stay with the brand if it had something to move up to.
My 23 MX is the best car I've ever owned. I wouldn't buy the current iterations of 3 and Y.
Most refresh X owners think it's pretty great (not perfect). There are no alternatives at the moment, mostly because other manufacturers are terrible at software development...and that's not good for software defined vehicles.
It's sad to see Tesla walk away from the luxury segment so they can focus on robots, go karts, and robots pretending to drive go karts.
Tesla have always said the design of the X was a mistake of over-engineering. I'm guessing there was no money to be made from it, especially as the sales dwindled.
Yeah, from the pictures of the underside I saw, it looked like a very solidly-built car. (Makes me considered buying one after they the depreciation curve.) Still its a big $$$ segment for everyone else.
They are almost exclusively focused on autonomous cars, humanoid robots, and energy (batteries now, maybe more solar manufacturing later).
As much as I dislike it, I can't disagree with the business case here. They already have >300k monthly subscribers at about $100/month. That business will grow rapidly from here as well as the robotaxi business itself.
Within 2 years, this business will look radically different just because of these two changes.
At the moment most of them are running notably below capacity.
Tesla's growth plan originally had them doing factory expansions and new factory in Mexico by now, but instead they have pivoted to trying to keep utilization of their existing lines up by introducing cheaper trims of existing vehicles.
The benefit of having control is that they can adapt them to their priorities. Similar Apple designing its own chips when there were already viable producers in the market.
They won’t need to rely on others prioritizing their priorities, like low volume, high cost early investments in batteries designed for a market (humanoid robots) that doesn’t exist.
If they then scale them up, they also have the benefit that there is no 3p supplier who can turn around and sell those to a competitor.
Sure. And selling the most popular car on the planet is a failure?
Didn't the US government put ~$80b into rescuing GM etc, years ago?
Subsidies bootstrapped the EV industry. Stupid policies mean walking away from the investment, ceding the market to foreign competitors, and doubling down on legacy ICE crap the rest of the world no longer wants...and Americans will be less and less able to afford.
Also, if you compare the entire model line up sales, Tesla isn't even in the top ten in sales. Tesla could disappear entirely and the car industry wouldn't even notice.
Car buyers are not confused. The market is naturally highly segmented. My needs "every day low distance compact car that can cope with city centre narrow streets with once a month motorway driving" is not met by the same car as "family of 5 with big dog living in a village"
it's very difficult to have a conversation about this, because it would appear that sincere answers to your question will get downvoted. one POV is that, if you accept the bear case from Internet commenters that these guys are incompetent or stupid - blah blah blah, Cybetruck - the existence of their autonomous taxi product is extremely bullish. they managed to pull off something similar to Waymo despite being so much worse at it, yes? I'm not sure they will even need a diverse product line of premium cars, if they can sell an autonomous 3 for the price of a small house. on the flip side, the bear case there is, if they could figure it out, so will a lot of other car companies. and yet, Cruise ceased operations, and Tesla will seemingly pay a manageable amount of blood money for Autopilot and move on.
nobody really can predict the future, so unsurprisingly, "reading various articles about this doesn't make it more clear." but people on the Internet keep getting worked up about it. to me, people do not comprehend the meaning of "high risk, high reward."
Their autonomous taxi program is a joke right now, especially compared to Waymo. Way fewer cities/rides, and they haven't even deployed their cybertaxi thing.
Tesla doesn't even trust their own full self driving system. They still have safety monitors for their self-driving taxi service.
The Las Vegas Loop continues to have actual drivers and that's an enclosed space entirely controlled by Tesla. If you can't even trust it in a single lane space you completely control, how can you trust it in the real world?
If you think it is, take your hands of the wheel and close your eyes. Fall asleep at the wheel. Not willing to do so? I guess your car isn't really driving you everywhere.
Your view on how stocks work is interesting as well — you realize most of the investors are regular, uninformed non-techies who invest based on vibes, right? Vibes like "my car is driving me everywhere, this is the future!" — the exact same thoughtless, surface-level analysis you're going off of.
Therefore, you're trying to beat the market by using the exact same reasoning 99% of its investors have used. Good luck.
> they managed to pull off something similar to Waymo despite being so much worse at it, yes?
similar?! what exactly is your definition of similar? tesla and waymo are so far apart that it is difficult to accept any argument that tries to make this comparison. they cannot co-exist in the same sentence unless to explain one’s success against the other’s failures
When Tesla started producing cars, everyone wanted what they proposed. Now, no one wants the cybertruck. No one is really asking for humanoid robots. Their self driving is vastly inferior to waymo when it comes to taxies, I can't see them winning that market. Their batteries and solar panels, like their cars, seem to be more or less abandoned.
So, it's pretty easy to see why people are confused and upset. Tesla is discontinuing all the things people like about Tesla, and selling vapourware that no one really wants anyways, instead. It's also not "a difficult conversation."
What seems more likely is that Musk, in his extreme shift to the right, has abandoned the original goal of Tesla: producing sustainable electric vehicles. He's become more and more delusional, with failing like the Boring machine and the Cybertruck starting to pile up. He's alienated his existing customer base by both getting into politics and dropping any pretext of trying to help the environment.
From my point of view, Tesla is a failed company with a leader who has gone off the rails, and a board that refuses to reign him in. Revenues are falling off a cliff outside of US governmental money, and it's betting the whole ship on only two ideas: self driving, which is so far no where close to being where it needs to be, despite the progress, and on yet another fairy tale that is humanoid robots.
The board cannot rein him in because doing so risks having the stock valued as a car company stock and not as a tech company or meme stock. I think they can only fix this after the stock has crashed.
imo their competition for autonomous vehicles doesn’t come from car companies, but from tech companies.
Amazon has a lucrative incentive to automate its supply chain up to and including last mile delivery. Waymo has proven out the tech and could easily partner with Uber or Lyft for the rider experience and reach.
If you’re FedEx, for example, would you rather buy from Amazon or from Tesla? Who is more likely to be a sane and trustworthy partner?
I don't think that Uber or Lyft are going to invest in self-driving taxis. The capital model is completely different: Uber and Lyft are by design capital light, they own nothing more than the software (1), and someone needs to buy all of these self-driving machines and then someone needs to maintain them, whereas their current model doesn't do that- they can't offer that to any tech partner.
The reason that you don't see more Waymo areas has nothing to do with rider pool or experience, it is because their tech requires pre-mapping everything with LiDAR several times- the advantage is that if you know what is static (because it was in all of that LiDAR mapping) then a simple difference algo can tell you everything that is dynamic in the environment. (Also, they are just starting to hit cities with significant precipitation- SFO, LA, ATX, PHX are all pretty dry cities, they are going into ATL, MIA, DC, DEN, etc.)
1: With a lot of suspicion that much of their profit comes from drivers not understanding depreciation of their vehicles, something that the accountants who work for Uber and Lyft will understand very very well.
I'm talking about after, of course. They retained a massive investment in Aurora as part of that deal. They invested in Waabi not long after, then Nuro, Avride and started partnerships with Waymo, Motional, and others.
Nvidia follows the same strategy because having a large end-to-end model is how you get your customers to buy GPUs with their AI slush fund (and I don't think they limit themselves to vision).
His rationale at this point seems to be mostly stubbornness, coupled with a healthy dose of anxiety when he considers how much money he'll have to spend to deliver FSD to the people who bought it 10 years ago.
Its not that strange; normally manufactures are focused on volume and brand.
So you have the 3 and Y in numbers where they can compete in the mass market price range; and CT and FSD for brand notoriety.
S and Y are not special enough to do anything for the brand, they dont qualify as halo products anymore. Probably still wouldnt be that interesting even if refreshed.
CT is still interesting, it looks different and has some tech inside that seems worthwhile to iterate on.
And unlike traditional brands, tesla has FSD, Optimus, and Musk to do enough to keep the brand itself healthy.
My guess would be they are deciding what they can learn by iterating the CT, and might decide to drop it in a year or two when the roadster takes the halo role.
They will keep trying to improve on volume for 3 and Y.
Elon for years has said Tesla is not a car company. He’s also said the “factory is the product.” Tesla also has energy divisions and investments, as well as xAI investments now.
Logically given that Model S and X are something like less than 5% of deliveries (and have been for years), if they’re right about Optimus, that capacity will generate far greater revenue.
They can probably hire enough random dudes in India, especially if AI reduces the need for call center employees.
It will be slightly creepy when the Optimus walks into the bedroom and stares while its owner is ... in the middle of something, but that's a small price to pay.
Plus the Tesla employees in the U.S. will also be able to share the video, so it's a win-win.
This is interesting. If Optimus hardware is supposed to be $15k, and Indian workers remotely operate it, there must be jobs in the US and elsewhere that it can handle. Median Indian salary is $4000 a year. No US minimum wage, no overly expensive health care, no Union fees, no workers comp, no visa. 86% savings over a US worker at $15 an hour. Plus, if they are a maid, there's a chance they'll get a free peek.
Optimus is complete vapourware. The quoted 1M units a year would be utterly unbelievable from any company, let alone Tesla with their history of over-promising.
Full disclosure: I am pretty sour on the current Amazon/AWS leadership as I think, well, they couldn't lead a company out of a paper bag (former manager at AWS). Is there data that Amazon/AWS is still hiring junior devs? I've heard it's very hard to get into student programs these days but I don't have the data. My grumpy position would be Garmin saying one thing and doing another.
If it's obviously useful then people shouldn't need to be prodded into using it. Maybe there are actual downsides to rushing through everything with AI, maybe people can't actually work on the hard things 100% of the time.
I just don't understand this need to rush, software already moves fast without AI tools. Software developers already make a lot of money for their companies that their salaries are easily covered. Realistically people could develop software 10x slower than now and the world would still keep progressing.
If I were to summarize how we attacked this when I was on AWS (different team)
formal methods. Some of this started a long time ago so not sure if it was TLA, TLA+, or something else. (I am a useless manager type)
fake clients / servers to make testing possible
strict invariants
A simulator to fuzz/fault the entire system. We didn't get this until later in the life of the service but flushed out race condition bugs that would have taken years to do.
We never got to replaying customer traffic patterns which was a pet idea of mine but probably the juice wasn't worth the squeeze.
"Tell me about a time when you had to work with a difficult team member"
Note that the above is the type of question my HR department tells me is scientifically validated. I have not read the research myself, nor do I know how to find it. As such if someone responds "that isn't" they might be right, you will have to judge their expertise themselves: I'm not qualified to know if they are right.
not quite true - there are some regions that have a different set of AWS users / credentials. I can't remember what this is called off the top of my head.
These are different AWS partitions. They are completely separate from each other, requiring separate accounts and credentials.
There's one for China, one for the AWS government cloud, and there are also various private clouds (like the one hosting the CIA data). You can check their list in the JSON metadata that is used to build the AWS clients (e.g. https://github.com/aws/aws-sdk-go-v2/blob/1a7301b01cbf7e74e4... ).
I think this is an astonishingly dumb take. Regardless of what you think of Musk, SpaceX is building a fundamentally important reusable lift technology that can be the underpinning of some many future developments. Who cares if China gets to the moon first? This is how NASA historically gets into a mess with its launch system - political pressure, conflated goals and requirements (see the Space Shuttle - does it launch people?, military payloads?, oh goodie - let's do it all). If anything I wish NASA would do more to make sure we have a decent starship competitor which its hard to see blue origin being anytime soon (but I am not an expert on this topic)
Yes, but there are several additional dimensions of perhaps-malicious idiocy that you didn't call the NYT on:
- The reason that NASA is stuck in this mess with Musk is that "their own" SLS, Orion, Lunar Gateway, & Co. program is a landfill of Congressional pork, trying to pretend to be a moon mission. And Washington has been talking smack about actually returning to the moon. And now China appears to be calling them on that cheap talk.
- Compared to the costs of SLS & Co., SpaceX's "one of his largest ever" contract for getting to the moon is small change. Has the NYT heard the old saying about "fast, cheap, and reliable"?
- Any manned Lunar mission must start with heavy lift to LEO. SpaceX utterly dominates that market. And has for years. On all 3 of the available, cheap, and reliable dimensions. Even if Starship could only do unmanned heavy LEO, having it operational would just make Musk an even-more obvious choice for that part of things.
- Musk has an available, reliable crew capsule - which is another difficult must-have for any manned Lunar mission. Vs. NASA's Orion capsule has been to orbit once, uncrewed, 3 year ago. And had major heat shield issues during the reentry.
Sounds more like an object system (immutable) with the veneer of a file system for their use cases. I sort of read the doc - sounds like data is replicated and not erasure encoded (so perhaps more expensive?).
I think many people have said this, but "file systems" get a lot easier if you don't have to worry about overwrites, appends, truncates, etc. Anyway, always interesting to see what people come up with for their use cases.
Append-only is pretty much the only way to do robust replicated storage at scale, else you get into scenarios where, instead of a given logical block having two possible states (either existing somewhere or not existing anywhere), the block can exist with multiple values at different times, including an unbounded number of invalid ones, for instance in case a client died halfway through a block mutation. Immutability is just plain a very strong invariant.
It also does not at all preclude implementing a read-write layer on top of it, for instance with a log-structured FS design. That's however the solution to a problem these people are, it seems, not having.
I did Symbian programming back in the day. IIRC the Sony-Erricson P800. It was not developer friendly. The memory management model was hard to program and could crash easily. Also did some work with Nokia on the N60. I was working at Orange at that time and we had hired a contractor to integrate push to talk (because for some reasons Orange though push to talk would take off in Europe, lolol). I got a couple of free trips to Tampere to theoretically help Nokia debug this third party push to talk app. I seem to recall Nokia not being too enthused to work with some pushy American hacker who wanted to open a debugger and fix things. I remember that we had some nice reindeer dinners.
Early mobile is littered with dead operating systems. not really that surprising. PalmOS, Symbian, SaveJE, windows mobile, etc. not worth crying over.
As a Tampere native working with a lot of old Symbian folks, it's good that you remember the dinners :) Hope you liked the city in general, we certainly do!
Palm OS is better described as "undead, and slowly reviving itself". There are ongoing efforts to port it to diverse new hardware (a couple of new-parts ARM boards, and the Nintendo DS among other targets), an alive community that preserves old software and writes brand new software, and at least one reimplementation project (Pumpkin OS).
Development was unfriendly because S60 supported running without virtual memory, so you had to be really careful releasing memory. I.e. it was targetting small CPUs. The wonky "cleanup" was a big part of this.
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