Jason Calacanis on the Robotaxi Endgame

I've seen them, been around them, but not since the live launch. I live out on a ranch outside of Austin. But I drive every day on self-driving. There are five Teslas here at the ranch. Number 16 of the Roadster, 16th ever one built in the Signature 100. And then I have Signature 001, the first Model S ever built and sold to the public. And I have those two classic cars in the garage. And then we have two Model Ys and one of the final foundation series of the Model X. So I am all in on Teslas and self-driving.

On the hardware 3 version, I would never use it for anything like more than staying in the lane kind of functionality on the 290 here or something. But for the model, the hardware 4, I use it probably 90% of the time. And then the 10% I don't is unprotected lefts, parking, you know, all those kind of edge cases. And I'd say if I were to estimate how close it is to being level four, like you could take a nap in it, 98, 99%. And that's my personal lived experience. And I would say a year ago it was like 90%. So I think they went from like 90% this time last year to maybe 98.x now. And I'm not sure and I don't have any inside information. Sometimes people conflate my relationship with Elon. We've been friends for forever, 30 years. They sometimes conflate that with me having some inside knowledge. I don't actually know the difference between the robotaxi version and what consumers have, but I'm always in the beta for the latest version on my personal Model Y. That's my daily driver.

Well, I think there's an interesting play there. Elon is also in addition to being a master of factories and at building products from those factories, his skill set is that factory, the dreadnought. He's also very good at business models and where the puck will eventually go. And the suburbs and the countryside. I'm in the countryside and then there's like the outer suburbs, suburbs, infill area and then cities. Probably not worth them running anytime soon. Cybercabs in the country or even the further out suburbs. Certainly infill in the city will be the low-hanging fruit that Waymo and Tesla will go after with their autonomy programs first. So, why not sell people 20 of them? I think they're probably a year or two away from giving it to consumers or I'm sorry, fleet managers because they're going to have a lot of work to do in cities with regulators, with depots and they are obsessed with safety. If Tesla were to have one of the accidents that Waymo had, Waymo killed a cat. Waymo hit a child in Santa Monica and Waymo just clipped a car at about 30 mph. You probably saw the car jet out and it kind of hit it and kept driving. Those three instances under Tesla would be showstoppers. There would be, you know, folks and Elon has said as much publicly, right? We have a different standard. It's the Tesla standard will be different than the Waymo standard, I believe.

Listen, the one thing I'm concerned about is there are a bunch of promoters, typically stock promoters, who trade in and out of certain stocks. And they will paint a picture and they're incredibly vocal and they post four, five, six, you know, YouTube videos a day and they're all dramatic and oh, you won't believe this, you won't believe that. The truth is much more mundane. For people who don't know, I was the third or fourth investor in Uber when it was a $4 million company. I've known Travis also since maybe 96 or 97, 30 years. And I helped raise the first round with them. I pitched Uber to 21 angel investors. I got three of them to do it. 19 didn't do it. It wound up being a 67,000x return, not percentage, X. So, $1 turned into 67,000. It's a pretty legendary investment. And what I watched happen with that company was hand-to-hand combat. And what people don't understand is just how hard it is to get through each city. Each city you have to get through. There's no federal mandate like, oh, everybody has to accept Ubers. We knew Las Vegas would be the last city to fall in London. And then in places like the People's Republic of Santa Monica, or like LAX, LAX has four people you got to get through. SFO has four or five people you have to get through. There's somebody in charge of the parking lots. There's somebody in charge of arrivals and departures. There's somebody in charge of taxis. Like, it is a regulatory mess. And that was really what Travis's gift was. He really knew how to scale and to hyperscale in many cities and that's what really built this unbelievable footprint that Uber has today. But this will be two to three times harder. Why will it be two to three times harder? Well, humans and citizens are going to have two main concerns about AVs that they didn't have about Uber. With Uber, there was some safety concerns, but not too much. There were regulatory concerns and protectionism and regulatory capture. Oh, the taxi medallion companies really went after us. They tried to block us. They paid off politicians. All that stuff. There were even like mafia type situations in certain cities. Like you would think the mafia doesn't exist, but like it does. And like they put arrest warrants out for my guy Travis in certain cities around the world. You try to go to Singapore, you try to go to India, very specific regions. It is hard. So the naive of the promoters in, you know, this space are that, oh well, you've produced a car that can self-drive, therefore 1 million will come off the line this year, 10 million next year, and 100 million in the third year. And we all know that's not how a deployment like this is going to occur. And you also, Grayson, you have a tracker now that shows the number of cars in each city. Yeah, I forgot the name of it, but I look at it often. Maybe you could give me the URL right now. We could just give it a little plug here, but I think that's particularly relevant for people to understand. This will be a much slower rollout than people believe.

Obsession. It would be obsession with safety. They do not want to lose an astronaut. It's no problem losing a rocket during the testing phase, but hitting a cat, like we talked about. Waymo killed that cat. And there were protests about the bodega cat. Like, it's a cat. There's probably a hundred thousand cats that get run over by cars, you know, a year in the United States. It's only an issue when it's a self-driving one. So, there's the regulatory piece, protectionism for job loss, and then on top of it, obviously, safety, right? And we are not going to take twice or society will not take twice as safe as the benchmark. It has to be perfect. When somebody dies or gets dragged by one of these cars, it will be on camera like it was for Cruise. People don't remember the Cruise one. A car hit a pedestrian. Pedestrian then ricocheted in front of a Cruise car. Cruise dragged the person then covered it up, didn't release the information, then got banned and then got shut down. Uber. During our safety tests in I believe it was Arizona, a safety driver decided to play Candy Crush and a homeless person tragically was walking across like an eight-lane dark highway and combination of early technology, safety driver, you know, not doing their duty and playing Candy Crush. The person died. Uber's program shut down. Now, I don't think Waymo and Tesla's programs would be shut down if there was an accident or Nuro or Zoox, but they could get put in the penalty box for a year, maybe two years, three years. And so could other people in that city or region.

Yeah. So, the partnership model we'll get into second. There were two critical mistakes that Uber made. One was ousting one of the greatest CEOs of all time of this generation and ultimately of all generations, Travis. The second was selling off that unit. But you have to understand, nobody believed Uber could ever be profitable with this model. I went on CNBC famously and got in with my friend Deirdre Bosa and she was like, 'Uber lost a billion dollars this quarter.' And I said, 'Deirdre, how many rides did they do?' And she said, 'Oh, they did 500 million rides.' I said, 'Okay, so let's divide these numbers.' So they lost $2 per ride. Let me ask you a very basic question. And she interrupted me. We got into a little kerfuffle. And I said, 'Well, you had me on the show. Let me just ask you basic math. Losing $2 per ride. How many rides do you think they would lose if they added $3 to the cost of a ride and made it $1 profitable and they made a billion dollars in free cash flow?' And she's like, 'Oh, I never thought about it that way.' And I was like, 'You might lose 1, 2, 3, 4%.' People who are taking Ubers or Lyfts at the time, there was no difference. The only reason they were being discounted is Travis came up with a very specific strategy, which was capital as a weapon. He knew he was the best at raising money. He raised a war chest and he said, 'The way I'm going to beat all competitors is I'm going to take their drivers. I'm going to give them incentives and we'll burn a dollar or two a ride and put them out of business. We'll take the oxygen out of the space.' And that strategy worked. But then when they went public, public market investors are totally different. And you're seeing this probably in Tesla stock right now. You venture investors, we suspend disbelief and we're betting on like a vision. And I think the way Warren Buffett said this was it's a voting mechanism and then it becomes a weighing mechanism. Uber's very much in the weighing mechanism like what is the actual results? What's the cash flow? And once they got massive amounts of free cash flow, $10 billion a year, people fell in love with the stock. Tesla is still in the voting mechanism. They get the Elon premium, the innovators premium, and it gets valued like a venture investment, which is to say, I'm not sure if they're at 14 or 15 times sales. 15 times sales, not earnings, times the topline number. And so that is incredible for them, but the markets clearly don't believe that this is going to scale until maybe five, six, seven years out. And I don't know that the market is wrong. I think this is going to take longer than people think.

But hold on let me interject here though. You know the way the markets work for story stocks like this and I've covered many of them over the past 30 years. It almost doesn't matter whether it's year 2, year 5, year 7, year 10. The terminal value whenever they get to that scale, whatever that future market's going to look like, who's going to own it, what's the size of it, and then that's where all the ultimate value comes into. And then to flip that on its head in terms of Jason, your issue that you had with CNBC and Deirdre, I think the same exists today as it relates to Waymo in that when people criticize Waymo, oh, it's $125,000 car, $75,000 car, and like, okay, but these aren't the cars that they're going to have that's going to drive them to that profitability. Not to mention the fact that when you advertise that cost over a half a million or a million miles like you're missing the point. We are such early innings in terms of that cost structure at Waymo that I think the future profitability is well undervalued.

Yeah. If you look at the bull, the Tesla bulls or the Uber maximalists, minimalists, etc. or Waymo maximalists, minimalists, when they talk about this, they'll cherry-pick the numbers. So, they are stuck on the $200,000 per Waymo car and then a fantastical $15,000 cost for the robotaxi. And both of those numbers are wrong, right? The robotaxi is probably 30,000 right now, maybe 40. Who knows what the prototypes cost? And they will get down to 20. I think that's probably realistic. The Chinese of course are making $20,000 cars already and you don't see them in America. So then people are super misinformed. The truth is, BYD, if you go to when I was at Davos, BYD is everywhere. And Ubers were driven almost exclusively by these BYD Dolphins. Mexico City, I saw the same thing. Singapore, same thing. Unless you're in a protectionist country like Korea, Japan, or the United States, you're not going to see these Chinese EVs. The Chinese EVs and eventually AVs, are all sub $25,000 already, and they are already able to produce them at scale. The government there wants to win this so much that they are discounting them. They are losing money on them and they're being subsidized by the Chinese government. The CCP is subsidizing them to flood the market and to kill competitors. That's what anybody in the automotive industry will tell you. Waymo's second version is probably sub 100,000 now. Yeah. So, if they can go from 200 to 100 and what these other folks who are making fantastical models that one company wins it all, they're assuming that the people at Google who define the category of Waymo and who are number one on the industry is so dumb. They're so stupid at Google. Google's the stupidest company run by the stupidest people. Waymo, who has the most cars on the road, has done a magnitude more than any other player, with the exception of the Chinese who are on their tail, that they're incapable of understanding, despite the 7,000 videos published every month, explaining that Waymo can't produce a cheap car, that they don't know. Management doesn't know at Waymo they need to produce a two-seat purpose-built car. Of course, they're going to build that car. Now, Waymo has a problem. They don't own a car company. They have to use contract manufacturers. My prediction, and this is jumping ahead in our docket, is that when they spin out of Google, which will probably happen in the next year or two, and then when they cash up through an IPO, which will probably be in two years, somewhere in that time frame, they're going to pull the trigger and buy a car company, whether it's Rivian, whether it's Lucid, you know, etc. and they will then own that factory and be able to produce 100,000, 250,000 and eventually 500,000 cars a year that are purpose-built for self-driving and you won't have the attached lidar and everything and those cars will be under 50,000. Obviously this is obviously what's going to happen. I'm sorry, Google bought YouTube, bought Android. Google is exceptional at doing M&A and M&A is now on the menu since Lina Khan left office. And Trump's like, 'Yeah, buy companies.' Tesla bought, I'm sorry, SpaceX bought Cursor for 60 billion. And there's been a bunch of other obvious acquisitions. Nvidia buying Hugging Face for 12 billion this week. So, M&A is back on the menu. We'll have massive M&A. Waymo has a huge challenge. They are going to need to be able to build cars at scale, and that's their blocker. And then also, they're going to have to build for peak demand. And that's another argument that most people are not aware of. If you worked at Uber or an investor in it, you understood this curve and that's why surge pricing came out and people tried to kill Travis over surge pricing. He said, 'Listen, you want somebody to come drive you on a Friday night from 3 p.m. when you start leaving work to, you know, 10 p.m. That driver has to give up their Friday night. If they're doing this as a gig, it's not their full-time job. They weren't assigned the shift. They don't have a choice like New York cab drivers don't have a choice. They have to just pick which 12-hour shift they're going to work. You have to incentivize them.' And that's where surge pricing came in. Having AVs sitting around is extremely expensive. Utilization is going to be the next critical discussion when they hit scale. And that's where Uber has an advantage. And that's why Uber now owns 10 to 25% of 20 different players. And they're going to use their free cash flow to own many more. And then they too will buy Nuro, Lucid, etc. And Lucid is obviously working. I think that much we know is public. Lucid is working on a two-seater purpose-built AV. So purpose-built AV is coming. Waymo has to buy a company. Uber has 20 partners and they put their orders in already.

Yeah. So Uber has to be able to communicate to their partners their intent right and the Waymo relationship obviously is a bit strained and they also have to do what's right for the business.

I think they'll TBD. I think it's like a jump ball and it will largely depend on what the gold medal winner. Who's the gold medal winner? And I believe the gold medal winner is going to be Elon and Tesla. Why do I think that they win the gold? I think they will have such a significant advantage in producing hundreds of thousands of cars per year and maybe eventually even a million, two million, outside estimate even three million coming out of that factory, you know, every year. If you look at the number of rides I'm saying will move from people driving themselves to being driven in a car, 2% is, you know, one and a half, 2% globally is what ride sharing is. That includes Didi, that includes Grab, includes Uber, Lyft, everybody else. You take those that 2% ride sharing, you grow it to 30. 15x is a massive amount of growth in 10 years. That's my bullest bullest case. But you could also build this model. It goes from 1.5, 2% to 15 to 20% in 10 years. That still is a 10x. That is a massive increase in the total addressable market. But in order to do that at 25 rides a day, 30 rides a day, which is what these EV AVs are capable of doing between pickups, drop offs, demand, cleaning, you know, best case scenarios of fleet management, you're going to need over a hundred million AVs globally. If those cost 30 or 40 thousand dollars, now you're looking at $5 trillion to build the fleet. You know, if for some reason the Chinese and Elon and Tesla get it down to 20,000, you're still talking about two or three trillion dollars. That is a massive amount of capital. That's bigger than the AI buildout now that we're talking about for data centers. That is a gigantic buildout. Who can afford that? Nobody except the financial markets, creating devices in order to have fleets get built and underwriting them. Just like people have underwritten insurance or homes or many different things in the past. So, you know, getting to a trillion rides, three billion a day and then who wins that? Well, if you do need a hundred million cars, 120, 80 million, let's just use 100 million as your number. Who's capable of making 100 million cars? Well, we make 100 million cars today, but we need to make EVs that have autonomy built in or have autonomy bolted on. That means I think Tesla said they're at like they could conceivably do 500 a week, a thousand a week. Okay, so they're at 50,000 right now. Let's assume they triple that every year. Okay, so they get to 150,000 in 2027 or 100,000 in 2027. 2028 they get to 200, 300,000, then to a half million. It's still not going to be enough to feed this beast. People are going to change their behavior from owning a car. And that was the big secret to Uber that nobody anticipated was it really was an alternative to car ownership for people who lived in cities or suburbs. And most families would have two, two and a half cars, three cars. And then they said, 'Well, when we need the third car or we need the second car, we'll have the kids or the spouse use an Uber, so we'll just get one car instead of two or we'll get two cars instead of three.' That's what's going to happen with self-driving. Young people don't even get driver's licenses now. They don't care about owning a car. So that is the inevitability here. I think Uber plus 20 or 30 partners including the Chinese partners which is critical including Lucid and Rivian which I believe those two companies will pivot and do only robotaxis. I believe the robotaxi market is so significant that instead of building and selling cars they're going to go right for robotaxis. Uber will take 15%, the financing companies will take some percent and it'll be more profitable for them to build cars to drive people. And my core belief is at least a dozen or two dozen people will hit full autonomy in the same 24-month period. The only company that has hit full autonomy in a constrained area is Waymo. Tesla has in a very small area, Austin, Texas, hit a relative amount of safety. What do they have? Two dozen cars without drivers, a dozen cars without drivers, and then you have China. And in China, they have a different view of accidents and people dying. So in this case, I think Tesla with the full stack is going to race ahead. I think Uber is going to take all the other demand and those companies, whether it's Aurora, whether it's Zoox, potentially Waymo, but probably not. Waymo, I think, is going to think they can do it on their own for a while. But every other car company, Lucid, Nuro, combination, etc.

No.

I hope so. Nuro, a management team that we obviously respect. They have a great relationship with Lucid. Lucid's a great car. Obviously, they've got some financial challenges for them. It would be a huge win if by June of next year they had 300 cars in any market in the US. 300 cars like and at that point Waymo is going to have 10,000. So then at some point maybe they can scale up. But then are we putting our eggs in Lucid scaling up the volumes that they need relative to Waymo's partner or what Tesla is doing and in terms of the number of cars assuming they don't also do the same thing that Waymo did and leave Uber. Well, BYD, WeRide, Pony, Didi. So here's the difference. Those companies in order to build an actual network will require about $100 to $300 per acquired customer. So in order to build a network that has 200 million members in it, you are going to need to spend $300 per member, $100 per member at the bottom. The only other company that has some advantage here with distribution is Elon because he can tweet and get a million users and get earned attention. And if Google decides to put Waymo into Google Maps and other products, they would have an advantage there and their acquisition costs would go down to $10 per person or even free. There's no way WeRide, Pony, Nuro, Rivian are going to be able to keep the expense up of making these cars, doing fleet management, and then building a network where it costs 100, 200 or 300 depending on which city you're in to acquire new customers and to displace existing customers. So this is where a lot of my experience comes from Robinhood which did an exceptional job when mobile came out of beating E-Trade and some of those stock apps. They did some clever things for it but they were a one of one and it is very expensive to acquire customers. Probably they spent $30, $40, $50 by giving a free share to each person. Uber did that same playbook. It's called give to get. I give you a $25 free ride. I get a $25 free ride. That was one of the secrets to Uber. So there's just no way somebody else is going to build another Uber-scale network with hundreds of millions of people who have put their credit card in. BYD Go is a possibility but they also are going to look at it and just say there's so much opportunity here if it really is going 10x like I'm saying or maybe 20x in the next 10 years is it easier to just take 80 cents on the dollar, 60 cents on the dollar and give it to Uber. If they do give it to Uber and Uber has fleet management through their partners or baked in and they take that on, either of those are possibilities or both is the most likely possibility, then they get to make 60 cents on the dollar, 70 cents on the dollar and not have to build a giant network and a brand. And when you see Uber having every ad when you get off the airport in Dubai or Tokyo, that free cash flow gives them a massive advantage and their user base. Uber One which gets people to do a lot more and people forget ride sharing has now become less than the Uber Eats business. So they have, whenever we talk about this, it's half of Uber's business. The other half is getting restaurants to agree to be part of a network. Again that's really hard to do because you have to get each local business to decide to sign up. So this idea Uber goes down to zero. Even if they only get 35% of the gains here in AVs, that's incredibly accretive to half the business.

Well, they're getting 25% now. And I think they'll take a smaller percentage on AVs.

Make 1.8 million cars a year. I think 1.7 and I think they almost hit two one year. And maybe they'll hit two next year with all the Model Y's. It's just not going to be possible to put that many out there due to regulations. And that's the next piece of the puzzle. Regulatory is going to slow this down. And the other thing people are not taking into account is the burn the Waymos, block the data centers vibes that are going on in America specifically. In China, people are 80% bullish on AI. And in China, they have now stopped giving licenses for autonomous vehicles. You can look this up. No more vehicle licenses because...

Yeah. So that is going to be the trend. In China their number one thing is harmony and employment and that signal is going to mean they're going to slow it down. Not for technical reasons and not for safety reasons. In China they'll have a totally different view of a child being hit by a self-driving car. And I think there was a video of that happening. They'll have a totally different view of cats getting killed and accidents. They look at individuals dying there totally differently than they do in America. And the safety, you know, required to even build a car there is totally different than the United States. So even with 80% popularity of AI in China, they love AI. They think it's great for the world. Here in the United States, it's like 80% of people think the opposite. They think it's terrible.

If they're going to stop it and slow it in China because of jobs, that is going to be exactly what happens in the Northeast and other protected areas, Boston, Jersey, New York, DC, these rumblings are already happening. And this is where this controversy of regulatory capture, Grayson, that I think you were pretty passionate about, is going to need to be worked out. And we're going to need to have a licensing. This is not like what I want. This is reality of people losing jobs. If your premise, Walter, is these things are going to get deployed fast and they're going to have a negative impact on people's jobs, which is what you just said, right? They're not going to have it. So, you believe that. And Grayson, you believe, you know, oh my god, Uber's so evil for wanting to have a soft landing for drivers and have a slower roll out and to work with the unions. The fact is there'll be no AVs. It's completely possible that Boston, DC, New York, New Jersey will just ban them completely. They'll just say, 'Yeah, we don't want these right now.' And if you don't believe that, look at Shapiro and what he did with data centers and Abbott. Those are the two governors who have been the most pro data center. And they flipped in 60 days to being completely anti-data center doing press conference with it. The politicians are going to use self-driving cars as their personal virtue signaling. We are going to protect jobs into the 2028 election is my prediction. And you have to negotiate the roll out of these with those unions and with those politicians.

Your premise is that local politicians are going to let this happen because the federal government's going to tell them that's not going to happen. Grayson, the local governments are incredibly powerful. Incredibly powerful. That flies in all evidence, Grayson. If you look at what happened with Uber when they tried to go into New York, when they tried to expand, it was regulatory capture all the way down. Same thing with Vegas. The federal government's not going to flip a switch and say, 'Yeah, everybody can yolo. You can put any number of these robo taxis anywhere you want.' And if they do try something like that, they're going to get sued to heaven by all these local communities and it'll be total chaos. Look at Flock for an example. Flock is we can get into a Flock debate, but states have Texas, for example, preempted local control. Florida preempted local control. Arizona under Ducey preempted local control for autonomy. And if you read the transcript for the last six months of Secretary Duffy and Administrator Morrison from NHTSA, there is a clear passion that this where this White House wants to go is preemption because it comes down to economics. You're talking a lot about China and controlling the whole market. Yes, they might be controlling the whole market, but they're exporting it to Europe. They're putting the Kazakhstan, build a factory, get the EU certification, and then Uber's there accelerating it. And just this week, there was a letter from Secretary Duffy to Jim Farley, CEO of Ford where he said, 'Reliance on technologies from foreign adversaries is not acceptable.' Well, what's Uber doing? Uber's accelerating that Chinese technology. So, that's a risk.

Steak dinner.

Fine. Done. Here's you don't know my Boa bill. I'm ordering that Wagyu beef from Australia. It's like 200 bucks a pop.

Hey, they're not incremental jobs. There's already people cleaning these cars, so I don't believe it's incremental jobs. I think there's no world in which drivers are not going to be the first group of mass unemployment due to AI. That will be the number one group. And I'm not saying that it shouldn't happen. What I'm saying is you need a plan if you're in this industry. And I'm a shareholder in all these companies like I'm a shareholder in Zipline as an example. Autonomy is coming. These jobs will be going away. They're hard jobs. Autonomy does it better. We'll be sitting here in 10 years and obviously there'll be less human drivers than there are today. How you get there and how you manage it as a society is going to be critically important. So when you see Uber paradoxically trying to balance their massive number of millions of drivers and the possible ban, it's quite reasonable to say we're going to cap the number of people losing their jobs at 10% a year or 20% a year for 5 years. And by the way, I think the technological roll out will probably align with that regulatory capture that's going on or being suggested by the unions.

Does that number include DoorDashers by the way?

What pace do you put it at? You think 10% a year, 5% a year?

They will demand it. That's true. That's what we saw with Uber and ride sharing as people demanded it and the public pushed the politicians. You know, the Airbnb experience is pretty illustrative. They were allowed and then they were constrained. They were allowed. They were constrained back and forth. Hawaii right now, Dallas, a lot of different areas are constraining them and licensing them. I think, and again, this isn't like my wish. I'm just telling you the game on the field as I see it. The game on the field as I see it is these are going to be licensed and they're going to be capped and then it's going to be who's willing to pay 10 or $25,000 a year for a license. I won't call it a medallion because it's not like an independent party's going to be able to buy it. I know Grayson you don't like this concept. I don't like it either necessarily, but I think that's what's going to happen. The same way Wuhan said we're going to give out licenses. This is going to be a licensed and that's what Vegas did, right? They just announced like they're giving a certain number of licenses to folks. It's going to be licensed just like Airbnbs are in Lake Tahoe where I have a home. They limit they cap the number of them. People line up to get them. They auction them and only a certain number of people can get it. That's the likely scenario here. It's not that I'm endorsing it or I think it should happen. I think everybody will want these. But we're going to have some responsibility as an industry to negotiate with local politicians and unions to deploy them intelligently.

Who's Sean O'Brien in this? Sorry.

Oh, got it. Okay. Yeah. I'm not in good standing with the Teamsters after my Uber investment.

Your position is local governments and countries around the world will not cap the number of AVs. That's your position, Grayson.

Isn't Vegas already capping them? So, aren't you wrong already?

Okay. Yeah. Walter, you agree? Where do you stand? Will it be capped in most cities or many cities in the United States?

So, there's the hope. I think Grayson, you're channeling hope. Walter is channeling reality and I'm channeling negotiation. Like, I think we're all fans of the technology. We all want to see people not die. And the crazy thing about the just a total weird aside, we got less drunk driving and we got more distracted drivers. So now we got the same number of road deaths, 30,000 a year despite drunk driving going down. Why? Because these teenagers are on their freaking phones and adults too. And that's the number one cause. And that's actually I think Tesla and maybe a good pivot Walter to one of your premises you've talked about on the show before. Or sorry to take over as moderator, but you know, will people just own a self-driving car, take it to work, and then say, 'Yeah, go circle or go be part of the fleet, or go park yourself back at my house and let the next person at my house use it, and hey, I'm going to be leaving work at 5:15. Be here at 5:15 waiting for me.'

$300 a month is what you're describing maybe 400 all in the insurance will go down because it's safer and then if B I don't know if you saw but there was a congresswoman, I think, who just this week said part of she's visit two weeks, Trump's going to open up America to Chinese auto manufacturers. I don't think that's true, but it certainly sounds like the Chinese are asking for that. And if that happens and we can buy 20k, 15k BYDs and Xiaomi and all this other stuff, like I think it's just going to be a crazy world where these cars are so cheap and I believe AV is going to be commoditized. I think in 24 months there'll be 10, 20 providers and this doesn't even take into account Nvidia and what they're doing. Nvidia is giving the world model the technology and they just want to sell chips. I think that's going to be open-source commoditization of the space and then Waymo and Tesla and Nuro. They're going to be looking at a world in 24 months where maybe their self-driving software is maybe not that special or unique. I'm not saying that's guaranteed to happen. I'm saying that's a possibility on the table here. A lot of this requires capital, right? And a lot of those companies, some of the companies you mentioned, Nvidia for sure, but it's not Nvidia, they're offering a stack, but they have to get an OEM that actually deploys it and does it well. Mercedes is their...

But here's the thing for you to watch. Here's the big moment which I believe is going to come by Q1 next year when we get concrete details on Waymo's Toyota's relationship and what those vehicles look like because don't forget Toyota former Tesla investor one of the early Tesla investors they can pump out cars faster than anyone in the world including Tesla and that relationship when it comes to that and there's a dedicated line in Japan this is just going to accelerate it.

It was an intent to an intent of intent to have a conversation to consider.

Yes, it felt like BS to me. But I do think that is another possible endgame is that and Elon's kind of again really smart go-to market guy. If he says to Toyota or to you know pick your company, hey you can have FSD for free and if people subscribe to it, we'll take 50 bucks a month. You take 50 bucks a month. Why wouldn't he take that deal? And he just says as part of that if they want to be part of a network they got to be part of the Tesla network, not anybody else's. Might be antitrust issues there, competition issues, but that's another possibility here. But in 24 months, no less than I wonder in 36 months if you'll be able to buy a car that doesn't have level four autonomy in it. Like you'd have to be like purposely'd be like buying a car without airbags.

I think Uber still goes up because they have many different businesses. And I think the number of people who will still want to own and house a car, this is why my bull case stops at 30% of rides, one in three, because I think a large number of people paradigm shift wise, can afford their own car and will prefer to have their own car. Then there's another group of people who either can't afford to have their own car or don't like the overhead of it, right? It's like almost like being a renter versus owning a home. I have many affluent friends who are like, I don't ever want to own a home. I just want to rent an apartment. It's a better deal for me. So, that's where the devil's in the details and I don't actually have the answer to that. That's also generational. I think people who are over 40 or over 30 years old, they're just going to want their own car. They want to leave their kids stuff in it. They don't want anybody else puking in it. I mean, and then there's another group of people who just will not want to have the overhead or even put the $5,000 down payment or have the $500 payment. They just want to use it on demand.

God. Yes.

So, Travis is your bud. First of all, have you water skied with him?

I love it. Steve Jobs returns. I've been saying it for years. I've been advocating for it and that would be great. I will be very excited day when Travis asked me to join the board of Uber and combines it with Adams. That would be my dream scenario.

Well, he's hard driving. And Dara has been incredible at calming things down with regulatory environments and got us to profitability. And he's been an incredible steward of the brand. I think in a way like maybe Tim Cook was an incredible steward of Apple. And now you have Prashanth in who's an engineer. Maybe they'll release a new product. I think if Travis were back, you would see a very very aggressive an even more aggressive push into AVs. Now, I don't know what that would be, but I think big M&A is on the market and maybe owning or more partnering. You know, this is my inside theory. My inside theory on Uber is place a lot of bets. And many times in my career, and I've only been an angel investor for 12 years, I've seen partnerships turn into purchases. And I coined that term in our industry, partnership to purchase. And so if you look at the group of partners, Lucid is backed by the Saudi PIF. Who was the big backer of Masayoshi and the Uber deal? PIF. Okay, now we're getting some footprints. How much is Nuro worth? 2 billion? Three billion? What's Uber's free cash flow next year? 11, 12 billion? It's a pittance. And so, and Nuro is nothing, too. No offense to the management team, but relative to what Uber would it would cost Uber to buy it. So, if you could buy Lucid, Rivian, and Nuro and AV ride, let's see, you know, maybe there's some redundancy there. And maybe, hey, throw in Volkswagen. I don't know what's out there and available that people want to spin out. Volkswagen ID seems to have been a bust. It was a cool car. I rented one once. Now we could be talking about a full stack Uber that is able to produce hundreds of thousands of cars a year, exactly like Elon is and exactly like Waymo isn't. That's what I believe is going to happen in the next 36 months.

I'm setting records here.

I do. But here's the most important thing. When Brunson can get four rings, then we're correct. So, I'll put that there for the...

I think they're afraid of their investors though because you know a lot of these things would be capital intensive. I think they've been easing them into that. But yeah, I think that's a great take whether it's Dara or Travis. I hope they go that route. I still own a significant portion of my Uber stake from the seed investment. But I've cleared a lot of it. Obviously, it was like 98% of my net worth at one point. And so I had to slowly diversify like you're supposed to. But I still have a big piece of it. And if they told the market today, nothing would make me happier than them saying, 'We're going to be break even for the next three years and we're going to pour $10 billion a year, not into stock buybacks, but into building AVs.' I would be so happy. And if the stock went down to 50 on that announcement, I would be fine with it because the amount of stock I have remaining, I would hold for 10 years. And all that matters for that half of the business is that they get the bronze or silver medal. We talked about this a lot when we were doing international expansion at Uber and when I say we like I was a very diminutive player in all this so I don't want to exaggerate it but I was involved in a lot of the conversations or I was witness to a lot of them in every market Travis said we're going for the gold we will accept the silver but if we're going to be bronze we're selling and taking equity in the gold place winner Didi they did that Grab they did that and those stakes collectively became worth like 10 billion which was the total amount that had been invested into Uber from the beginning. And this is the thing, when you have a big chip stack, I think Tesla's got 40 billion right now. They've got a big chip stack. They're going to be able to do creative things like that. That's why I picked Tesla as gold, Uber right behind them with silver, and then Waymo third. And to our earlier question that I didn't answer, I think the Waymo Uber dynamic is a little rocky right now. Because Waymo got tweaked that Uber was doing so many partnerships. I think Waymo realizes Uber can have five, six partners in a market and those five or six partners that aren't Waymo are going to be fine with it. But Waymo is going, 'Wait a second. Aren't we the leading category or shouldn't we get exclusivity in Dallas, Houston, New Orleans, whatever?' And I think Dara just said, 'No.' And they were like, 'Well, that pisses us off.' And then plus you're going to throttle in these northeast markets and you're gonna work with the unions to do this that piss them off a little bit. But if the two of them see Tesla run away with it, which I think is probably the default in the US at least is that Tesla's going to make a very strong showing because I think they're at 99 something or 98 point something in terms of safety. And competing against Elon is like you're going to lose. It's just the nature of it. I think that may make them strange bedfellows where they go, you know what, we need each other. Maybe it's a third of a chance, 30% chance that they come to that conclusion that we're stronger together. Waymo will have their own app and you can get a Waymo in an Uber. And the reason you guys debated this, why can't you get a dedicated AV in the Uber app? That was because I believe...

The contract with Waymo was, you know, we're going to abstract you or they didn't want to be selected, you know, as the default and have a long wait time.

Yeah. But I think now the market has proven there's a group of people who will wait 10 minutes to be in a self-driving car because they don't want to have a driver. Whether that's because of the hygiene of the drivers, what like some people say,

The consistency, privacy, I want to make out with my girlfriend. I don't know what the two of you guys are doing when you do your inspections of different areas. I don't know if you guys are holding hands back there. I don't know what's on your playlist.

Don't go breaking my heart.

What's on this? What's on your mutual playlist? What are you guys playing? Liki D and Elton John. Don't go breaking my heart.

I'm eclectic. Our rides become eclectic.