Tesla plans to equip new vehicles with self-driving hardware

The technology will not be deployed until sufficient real-world testing has been performed, CEO Elon Musk said.
UPDATED: 10/20/16 1:55 pm ET - adds details

After receiving scrutiny from regulators worldwide, Tesla Motors has ratcheted up its self-driving efforts by equipping all models with hardware that could enable fully autonomous driving.

Vehicles currently in production -- including the upcoming Model 3 -- will now have “Hardware Two,” which includes eight camera sensors (an increase from one) and 12 ultrasonic sensors, Tesla CEO Elon Musk said Wednesday on a conference call with journalists. The new hardware will disable certain functions of Autopilot, the automaker’s semiautonomous software, and Tesla vehicles already on the road will not be upgraded.

“This is different from Autopilot,” Musk said, adding the hardware would be the “highest level” of autonomous technology.

Though vehicles will have fully self-driving capability, the technology will not be deployed immediately. After “millions” of miles of real-world testing, gradual upgrades will be delivered to vehicles over the air every two to three months beginning at the end of 2016, Musk said. Much of the research will be done while the hardware is in “shadow mode” -- evaluating driving situations while the driver is in control without acting.

Musk said the added cost of the new hardware is about US$8,000, compared with Autopilot, which is US$3,000.

Tesla shares fell 2.4 per cent in morning trading today after a 2.2 per cent increase Wednesday leading up to the announcement. Shares have declined 15.2 per cent thus far in 2016. Analysts have been skeptical of the electric automaker’s profitability since it said in June that it planned to merge with energy company SolarCity.

“The capital intensity of the [SolarCity] business…will increase the risk profile of [Tesla’s] business,” Credit Suisse analyst Patrick Jobin wrote in a note to investors following the merger announcement.

On Oct. 28, the companies plan to showcase a jointly developed solar roof, battery and Tesla charger in the San Francisco Bay area.

Regulatory scrutiny

Tesla’s update follows months of scrutiny over the name and function of Autopilot. In May, Florida driver Joshua Brown was killed when his Tesla Model S crashed into a truck while the technology was engaged. This month, German regulators told the automaker to stop using the term “Autopilot” in advertisements, calling it “misleading.”

Musk said such reports have halted the progress of autonomous technology by preventing widespread public acceptance.

"If you're writing an article that's negative, that essentially dissuades people from using [self-driving technology], you're killing people," he said.

Tesla also announced the plans in a blog posted on its website. The blog includes a video showing a self-driving Tesla demonstration.


You can reach Katie Burke at kburke@crain.com -- Follow Katie on Twitter: @KatieGBurke

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