[lacker]

It seems tough culturally.

If you look at it from an outside point of view, right now Tesla is worth $1.6T, Waymo is worth $130B, and GM is worth $72B. If Cruise were actually a third viable competitor in this race, it would probably be worth more than the rest of GM. Self-driving is just a far more valuable business than car-making.

So from that point of view it would make sense to say, don't worry about the rest of GM too much, you should be willing to sacrifice all of that to increase the changes of making Cruise work.

It's hard to change the culture at a place like GM though. Does the GM CEO really want to take a huge amount of risk? Would they be willing to take a 50-50 shot where they either 10x the company's value or lose it all? Or would they prefer to pay a few billion dollars to avoid that risk.

[Alive-in-2025]

Using tesla valuation is not useful. It's a meme stock, has AI bs overvaluation over it. It's value is completely unconnected from reality. The car business is declining steadily. It's a good day when the famous CEO doesn't do something incredibly destructive to the brand name. It's just going down.

At the same time, if Musk went away, the stock would crash back to reality but a non-idiot leader could just do impossible, crazy, hard stuff, like ... working on obvious new models and basic steady improvements.

Tesla PE is 398 today (after a drop). Toyota's PE is 13. Toyota at the least is not hemoraging market share, sales, revenue, profits. Tesla is losing on all thoes things. Tesla would need a 30x price reduction to get down to much much more stable and profitable toyota. It's gets worse because Tesla's sales and profit keep going down each quarter.

There's no doubt value in self driving but the overall value is questionable. If there are many companies providing it, and at least waymo is doing great, plus there are many many other companies in China in good shape, the value multiple won't be there.

What's the market value of all taxi compannies combined in the us? It was about $230 billion in 2024 (https://www.skyquestt.com/report/taxi-market). Will tesla get 100% of the us self driving business in the future? No, waymo at least will be a serious market competitor, tesla's service doesn't really work.

Because there are going to be muiltiple competitors with working products (we'll see if/when tesla ever gets there), Tesla's huge valuation will never make sense. Robots are much farther behind than robotaxis (there's no brain, no prototype of a learning system, maybe one day).

This got way too long, I think GM just saw it as a money sink. I think that was a big mistake, though.

[lacker]

It's funny to use "the market value of all taxi companies combined" as a proxy for how valuable the self-driving market will be, because that's exactly the reasoning that led people to underestimate Uber. The market value of all taxi companies combined was pretty small when Uber started.

That said, you could be right! Maybe self-driving will never be worth more than that. It's really hard to tell what business models will be like in the future. But this is the cultural mismatch, it seemed like GM leadership did not want to be in a risky business where they were betting billions of dollars on the success of self-driving. Clearly, to some people, that seemed like a really good bet to make. Time will tell.

[refulgentis]

Cosign, there's a reason it took forever and a day for Waymo to actually scale. It's great stuff, changed the way I live, but they gotta wince at the economics.

[Eridrus]

Waymo has been attracting outside capital just fine.

I think the bigger issue is that Cruise was not succeeding at building the driver.

Cruise was shutdown after a safety incident, same as Uber.

[mkozlows]

I feel like the bigger issue is that Cruise evidently had an unsafe company culture (like Uber): It wasn't just that they had an incident, it's that they lied about the incident and tried to cover things up.

This has been a pretty consistent pattern -- Cruise was always less transparent about its safety data than Waymo, and its claims tended to be opaque and non-measurable, whereas Waymo was partnering with insurance companies to get hard data.

Waymo is going to have incidents, too, but I think they have made the (correct) decision that being open and transparent about safety stuff is the way they move past those; Cruise made a decision in the opposite direction, and it killed them.