Uber vs. Tesla, Robotaxi Timelines, and the End of Human Driving | Uber CEO Dara Khosrowshahi | #243
In a Nutshell
Uber CEO Dara Khosrowshahi details the company's turnaround from $4.5B annual losses to $10B+ profits by focusing ruthlessly on core strategies, positioning Uber as the leading platform for autonomous vehicles through partnerships with Waymo, Nvidia, Pony.ai, and others—aiming to facilitate more robotaxi rides than anyone by 2029 via standardized APIs, data sharing, and hybrid human-AV fleets. Autonomous adoption will be gradual due to existing car inventory, but every new car will be AV-ready in 10 years, slashing costs 4x below ownership, boosting safety 10x, and expanding into delivery (drones, sidewalk robots), eVTOLs with Joby, and global markets like the Middle East. Drivers transition to fleet owners amid growing demand, with Uber's intense work culture emphasizing impact through hard work and flexibility.
These notes were generated by AI and may contain inaccuracies.
When Dara Khosrowshahi joined Uber, the company was losing $4.5 billion a year. Today, it earns over $10 billion a year. He focused the organization by saying no to ideas, amplifying the yeses and pointing the company in a singular direction.
A hundred years ago, the shift from horse and buggy to cars took 15 years for 50% of vehicles to be cars. The transition to 50% self-driving cars will take a very long time due to existing car inventory with average US car life over 10 years.
Khosrowshahi left a $200 million stock package at Expedia, one of the highest-paid CEOs, to join Uber.
Strategy Lessons
Strategy is just as much about what you're doing and what you choose not to do.
Uber will win with autonomous communities. Autonomous vehicles are increasingly a reality after 15-16 years of development. Waymo is a leader and partner in Austin and Atlanta. The outcome won't be binary; it will develop in a hybrid way with fleets mixing autonomous and human-driven vehicles. Uber has over 20 partners including Nvidia, WeRide, Pony.ai, Wabi. Uber wants every terrific licensed robot driver on the platform like human drivers. By end of year, in 15 cities with partners. By 2029, Uber will facilitate more autonomous and robotaxi rides than anyone else.
Elon Musk's approach is vertical, even owning their refinery. When Tesla's camera-only FSD is safe, Uber would love Teslas on platform; already tens of thousands of Teslas with some drivers using FSD.
Uber as poster child for Exponential Organizations that scale with technology. Humans more complicated than robots due to unexpected behaviors and differences like Bangalore vs. San Francisco. Standard APIs for autonomous partners. Uber provides data for model training (pick-up/drop-off locations), fleet management. Uber handles car ownership, repair, cleaning so partners focus on safe, affordable autonomous driving.
Tech Ecosystem
Announcements with Lucid, Nvidia, Nuro at CES.
- Demand aggregator: Uber
- Autonomous drivers: Waymo, WeRide, Pony.ai, Nvidia, Nuro, Avride, Wabi, Zoox
- Cars: Lucid (redundant steering, braking, sensors)
- Fleet management/ownership: Uber buys early, later asset-light like Marriott with financial players (Blackstones) owning fleets for 9% yield
Another trillion-dollar marketplace. Streets safer: autonomous drivers don't get distracted or tired. Regulation ensuring safety.
Early Tesla FSD data suggests 10x safer, though most have backup drivers.
Uber provides commercial insurance for human drivers. Autonomous providers like Waymo responsible for their drivers/software. Liability will come down, savings passed to consumers. Waymo cars ~$150k, Cybercab $30k. Asset cost important for profitability.
In 10 years, every new car sold will have autonomous software and sensor stack (lidar/camera costs dropping). 10+ providers like fragmented OEM industry.
Uber in business of wiring up things that move: trains, boats in UK/Spain. Expanding Uber Eats to grocery, retail (Best Buy, Sephora, makeup) within an hour; growing faster than expected.
Never underestimate the power of human laziness.
In next 10 years, every new car autonomous-ready. Huge existing inventory slows turnover. Autonomous 4x cheaper than owning a car; cost per trip down, safety up, personalized (music, privacy). Expands TAM for mobility/delivery.
Vision: AI anticipates needs via calendar/home cameras; autonomous Uber arrives automagically, e.g., lie-down bed if poor sleep detected from data.
Middle East most pro-autonomous (Abu Dhabi, Dubai, KSA): young, tech-savvy governments. Already in Abu Dhabi with WeRide. Europe opening up, excited about UK with Waymo (software stack for OEMs). France improved since banning Uber initially.
Secondary benefits: In Paris banlieues, Uber dropped crime 10x in 18 months (vs. $40B government failure); reduces drunk driving.
Uber pioneered eVTOLs with Elevate conference, sold to Joby (right decision for focus; decade away). Now partnered with Joby (extraordinary CEO, Toyota manufacturing/safety partnership).
Vision: End-to-end trip planning. Abu Dhabi end of year: Uber to vertiport, Joby flight, Uber to destination, saving hours in traffic. US next year pending licensing, production, AI oversight.
Uber as platform for flexible work: driving, delivering, shopping, Uber AI Solutions (data labeling, model selection, image tagging).
Transition drivers to fleet managers/owners: displaced drivers buy cars that work for them, enabling agency from labor to capital.
There's always some work involved in maintaining the fleet. Buy 100 cars, have them going around LA. Put LEDs on the side and have a clawbot experiment with different marketing pitches as it's driving down the street, differential pricing.
I will make sure I give you a call when we open up in LA.
Besides flying cars, drone delivery. Zipline is an amazing company; Keller Rinaudo from Zipline is here tomorrow. Starship is the wheeled ground robot. Uber is talking to Keller and working with drone companies like Sky Trax, Mana, etc.
Delivery is harder than passenger mobility because food doesn't get to the car or out of the car. Positioning of pickup and drop-off is different. Robots could jump out of the car as part of the solution; it's a first mile, last mile issue.
Two modes for delivery:
- Drone delivery for suburbs, markets without high-rises. Excited because suburban markets are a new growth opportunity. Drone delivery will be a surprise and delight moment: get food in 10 minutes (usually prep time is 10 minutes, plus two more), within 15 minutes, spectacular.
- Sidewalk robots in urban markets like Coco or others. In Santa Monica, they're all over the place. Right for short deliveries within a mile or two because they don't go very fast and use the sidewalk.
Ultimately, a multimodal delivery network: sidewalks, sky, and eventually specialized delivery robots on bike lanes or roads.
Roughly a million active drivers in the US, more than 10 million globally.
Looking to 2030, significantly more drivers on the platform, including the US, than today due to business growth over 20%; audience growing almost 20%. Need to add drivers to keep up.
Autonomous: around 20% of drivers slough off every year; they find something else, full-time work, etc. As autonomous is introduced, slow down recruitment of new drivers so existing drivers have just as much work.
Autonomous brings new customers, expanding the market. Austin and Atlanta markets growing faster than average nationwide, suggesting more business to go around, especially as prices come down.
That's what we do: give your time back. That is the value Uber represents, whether working in the car or not going out to the restaurant.
One of the most extraordinary tech CEOs. Philosophies about running the company: not shy about telling employees they got to work their butts off.
Post-2020 COVID era, people out of office. Philosophy to drive Uber's success, inspiring/directing employees.
Didn't come to Uber thinking it was a layup; Uber was going through a very difficult time. Joined in 2017. Personality at Uber: likes running to the fire, doesn't run away.
Biggest reason to join: go to a place where you can make impact, having impact in the world. Impact doesn't come with a free lunch; have to work your ass off.
It's an intense work culture. Work with super smart people working really hard. Comes with trade-off, but flexibility around work. Fun to work hard and succeed at difficult things. Gives another level of satisfaction. Uber offers that; very plainspoken about it.
Recently introduced Dara avatar for employees to practice pitches and get feedback.
It drives me nuts. All these prep meetings are a waste of time. Just come in, let's talk. We're human beings. Fancy title doesn't mean endless prep.
People say the avatar is amusing and helps prep. Should do a pitch in front of it.
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