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Tesla’s third-quarter profits beat expectations, boosting its shares.
CEO Elon Musk used the good news to preview Tesla’s ride-share service.
The Tesla Network could arrive for passengers by 2019.
After a controversial couple of months, things appear to be looking up for Tesla CEO Elon Musk. Tesla announced on Oct. 24 that its third-quarter profits beat Wall Street expectations, to the delight of its investors: Shares rose more than 12 percent following the report. Musk also purchased $10 million worth of Tesla stock on Oct. 29, boosting his ownership of the company to nearly 20 percent. Now, it looks like Musk has returned his focus to the ride-hailing industry.
“Tesla will operate its own ride-hailing services and compete directly with Uber and Lyft, obviously,” Musk said following the earnings report, according to CNBC.
What to Expect From Tesla Network
The potential ride-share service would be called Tesla Network and Musk said in May it could be operational as early as the end of 2019, Business Insider reported. The timing hinges on Tesla further developing its autonomous vehicle system and getting the sign-off from regulators. The plan is that customers plugged into the network will be able to offer their vehicles to other drivers and remove them at will, similar to how homeowners can offer rentals on Airbnb. Tesla would also offer vehicles from its own corporate fleet to account for demand when there are not enough customer cars to be lent out.
Tesla still has advances to make in its self-driving system. Its current incarnation of a self-driving car is essentially glorified cruise control. Although the system can handle some driving tasks, drivers are still required to keep their hands on the wheel at all times.
The idea to incorporate Tesla’s self-driving cars into a ride-sharing model has been floating around the company since at least 2016. Musk’s guiding essay, “Master Plan, Part Deux,” which he revealed in summer 2016, included this statement:
“When true self-driving is approved by regulators, it will mean that you will be able to summon your Tesla from pretty much anywhere. Once it picks you up, you will be able to sleep, read or do anything else en route to your destination.”
The move into ride-hailing feels like a natural progression for Musk’s future-focused businesses. It also signals a new revenue and investment opportunity: The ride-hailing industry is expected to reach $276 billion by 2025, according to a 2017 Research and Markets report. Given Musk’s erratic behavior in the last year coupled with his increased ownership, it’s a tough call what his plans will really mean for shareholders.
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This article originally appeared on GOBankingRates.com: Elon Musk Will Take on Uber and Lyft to Give You Another Ride-Hailing Option