I'm sorry, but this is the very blindness the old smartphone manufacturers exhibited. Nokia, Sony-Ericsson, RIM, they all had well-established offerings of smartphones with the on-paper capabilities matching, or rivaling, that of iPhone. Unified messaging, camera, keyboard, handwritten recognition, web browser, you name it. Even apps ecosystems. All good, right? And yet the iPhone won via software. And via the hype. And via the app store in the longer run. And via tight integration with other Apple offering in the longer run. And via upmarket, "cool" brand.

The customers were sold "the experience of future, today". Cringe? Sure, but it worked.

>An electric car has the same features as a gas car, with the exception that its drive chain has a different source of power.

Wrong, very very wrong. A gasoline car is goods sold via dealership network at about zero margins, with the tacit understanding the customer will be back frequently to change oil & filter & timing belt, service the engine (almost every new generation of ICE comes with serious deficiencies), upgrade firmware, and all the jazz. The money for the dealership is in the servicing, not in the initial sale.

An electric car is, for better or worse, mostly absent those services. You rotate tires, replace brake pads & shock absorbers once every several years, and that's that. Any money to be made is in the charging network, if at all.

There is a dual shift - software/perception/hype, and also the business model. The traditional vendors have already mostly figured out how to put electricity in cars (if at low efficiency); but they desperately need to un-learn how to sell cars via the legacy business model. Right now they aren't ready to ditch the dealerships, while at the same time they want to sell ever more of the dealership un-friendly electrics. Talk about stuck between rock and hard place.

Citation needed.

This quora answer claims net margins at 1-2% back in 2013 (a lifetime ago) but there is no citation: https://www.quora.com/What-is-the-profit-margin-of-a-new-car...

Especially at 30k/vehicle price points.

Point 1)

Tesla does not have SAE Level 5. It is an absolutely ridiculous claim. At most Level 3, but the SAE levels are kind of fuzzy between 2 and 3, so you could even argue level 2. [1]

Tesla Autopilot cannot and will not be able to deal with ALL situations that can possibly occur - which would be SAE Level 5. They are spouting marketing bullshit in face of their poor quarterly results. Most engineers in the space will agree that level 4 will be the highest level reached for decades - if ever. Showing an Autopilot in heavily trained-for area during perfect weather and road conditions with infinite retries for getting the video right means nothing.

This has to be viewed separate from some real progress and contributions that Tesla has made in the space. However, that doesn't mean they get to throw around the "Level 5" term yet. And they likely won't within the next decades. Level 5 is a whole other beast than Level 4 and nobody is even remotely close to get there.

Point 2)

Have you ever sat in a modern car beyond 1995? They ARE computers. And in most recent years, user access is widened. 10 years ago an onboard computer would calculate your air-fuel mix and you wouldn't ever interact directly with it. Today there are huge and ever growing interfaces and you can use voice control to make your car perform certain tasks.

So yes, software is eating up the industry. Doesn't mean the steel hunks disappear.

[1] https://cyberlaw.stanford.edu/blog/2013/12/sae-levels-drivin...

Where did you see Tesla make the claim that they have SAE Level 5?

No, it was made by Marc Andreessen in reference to how software companies were taking over. It had nothing to do with replacement of humans.

https://a16z.com/2011/08/20/why-software-is-eating-the-world...

The OP's comments are spot on IMO.

Tesla is presenting a new model for automobiles where your car isn't outdated every year by a new trim design or every 5-7 years by a generational uplift. Instead your car evolves as you own it and enhancements are made incrementally both to the software and hardware rather than being held back for annual or generational releases.

In the less than 6 months I've had my Tesla Model 3 it has had software updates to:

- improve braking performance

- increase surpercharger performance

- increase power output, speed, and acceleration

- increase range

- enhanced automatic electronic braking

- enhanced lane departure warnings

- add dashcam recording capabilities

- add deterrence, video monitoring, and logging security features

- add climate control management for pets

With a traditional car company all of those things would be added incrementally in subsequent years or not at all.

*edited for clarity.

But I see the advantage of Tesla's approach. On the other hand I can sign up with our family Peugeot for regular updates for free for, it was, 2 years or so. Not over the air the registration is a pain. But it's not that it isn't there.

My Chevy Volt has had two software updates in the past 6 years.. not user noticeable improvements. I love my car but the car I was sold in 2013 is the same (problems and all) car I have now. My friends who have had their TM3s for over a year have drastically improved cars in almost every aspect.