Tesla's robotaxi plan faces many unanswered questions

• Impatient investors want details. But so far, Musk isn't providing much information aside from vague promises that Tesla's value will soar when its robotaxis materialize.
• "ARK Invest thinks on the order of $5 trillion; I think they are probably not wrong," Musk told investors Tuesday, referring to an investment firm's particularly bullish predictions.

Yes, but: Tesla is worth $700 billion today.

• Even Uber, whose ubiquitous ride-hailing network operates in 70 countries, is worth just $140 billion.

Driving the news: During a call to discuss Tesla's disappointing second-quarter results, analysts pressed Musk on what to expect ahead of an Oct. 10 robotaxi introduction, which was originally planned for August.

• "Obviously, my predictions on this have been overly optimistic in the past," Musk said, adding that he thinks "unsupervised full self-driving" — key for robotaxi operation — could be ready by the end of this year.
• "I'd be shocked if we cannot do it next year."

The big picture: Musk envisions turning Tesla's existing customer-owned fleet into a commercial robotaxi network like "Airbnb on wheels," he said.

• When Tesla owners aren't using their cars, the thinking goes, they can send them out to pick up riders 50 to 60 hours a week, sharing a portion of the fares with Tesla.
• Asked how long it will take to scale a ride-hailing service, Musk said: "We will have a fleet that's on the order of 7 million vehicles soon. ... This is basically instant scale with a software update."

Reality check: Currently, Tesla only has about 2.2 million vehicles on U.S. roads, and virtually all of them would require updated computers and cameras to enable full autonomy.

• Some customers paid as much as $12,000 extra for full self-driving features they've yet to receive; it's not clear who would pay for the required hardware updates.
• Plus, Airbnb on wheels already exists through peer-to-peer rental companies like Turo.
• Yet only a tiny fraction of car owners choose to list their cars for rent on the Turo platform.

Musk thinks the numbers will be much higher on a prospective Tesla robotaxi network.

• "The entire Tesla fleet basically becomes active. Maybe there's some number of people who don't want their car to make money. But I think most people will."

Zoom in: A separate fleet of Tesla-owned cars will also be part of the network, Musk said — presumably the robotaxi that has yet to be unveiled.

• But Musk dodged specific product-related questions, including whether its robotaxi design will need a regulatory waiver to operate without a steering wheel or pedals.

Context: General Motors' Cruise unit just killed plans for a dedicated robotaxi without those controls, citing "regulatory uncertainty."

• Musk, on the other hand, said he doesn't think regulatory approval will be a limiting factor.

Rather than the city-by-city strategy that rivals Waymo, Zoox and Cruise are pursuing, Tesla is working on a "generalized solution" that would allow its robotaxis to drive anywhere.

• "It would even work on a different Earth," said Musk, whose interplanetary ambitions are well known.

Between the lines: Besides the remaining technical challenges, there are still a slew of unanswered questions about how Tesla would turn its customers into business partners in a robotaxi service.

• Who would be liable in case of an accident or theft?
• How will owners' and riders' privacy and safety be protected?
• How will Tesla ensure that owners' cars are clean and properly maintained, or that they're sufficiently charged to get riders to their destination? Tesla's brand reputation is on the line, after all.

The bottom line: Given all the complexities of autonomous driving, Tesla is likely to commercialize its Optimus robots far sooner than its robotaxi service.