Should Tesla Just Buy Uber

Someone made the case that Tesla should buy Uber. Is this something Tesla should do?

Should Tesla buy Uber

Tesla is very serious about its plans for autonomy and in fact, Tesla will try to sell every car it makes in order to do this. With the upcoming compact cars coming in a few years, Tesla is going to reach record highs in vehicle production.

What this means is that if FSD and autonomy truly pans out for Tesla, which I think it will start in 2024, then there will be millions and millions of Tesla vehicles ready to offer autonomous ride hailing services.

Gary Black, a fund manager, said on Twitter that Tesla should buy Uber. When he said this, I thought about it and have a few things to say. There are a few good reasons to buy Uber, but some terrible reasons that overshadow any good reasons.

Tesla is acquiring companies. Recently, Tesla bought Wiferion, a wireless charging company based in Germany. I think that Wireless charging will need to eventually happen with EVs, as plugging in a charger every time becomes cumbersome.

We know that Tesla will acquire a company where it is absolutely necessary or there will be great benefit to the business. Let's go over what acquiring Uber would be like.

Can Tesla Buy Uber

Uber has a market cap of around 94 billion at the time of writing this article. This means that Tesla does not have near enough cash to buy Uber for that price. That makes it impossible, right?

Not quite - Tesla can raise money, take on debt, and "pull some strings" in order to make this deal happen, just like Elon Musk did when he acquired Twitter (now x.com).

I think Tesla should not buy Uber at a $94 billion market cap, that just seems crazy to me and if Tesla is moving to autonomous ride hailing, then why would having Uber with human drivers make any sense?

It only makes sense for the platform and user base. That's it. Uber has around 137 million customers that take about 25 million trips per day. If Tesla has Uber, it has all of this and the users ready to go.

I think the price is too steep, however, and Tesla can roll their own ride hailing app when autonomy is ready. The moment someone uses the Tesla app and pays much less money for an autonomous ride, word is going to spread like wildfire and Tesla ride hailing is going to grow rapidly. That's my prediction.

Tesla could buy Lyft, however, for $5 billion, and that might be a nice way to get into ride hailing without selling everything you have to buy the company.

Either way, when Tesla autonomy becomes rock solid and rides start happening and people see that they are much cheaper, it is going to spread very quickly.

What do you think? Should Tesla try to buy Uber?

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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News. Image Credit, Tesla, Screenshot