Tesla and Uber Could Soon Become Foes in the Driverless Car Market

Electric car maker Tesla Motors Inc (NASDAQ:TSLA) will soon face a new competitor in the autonomous car market: privately-held ride-sharing behemoth Uber.

Tesla was the first company to make self-driving cars a reality. Its Autopilot feature on select vehicles allows drivers to just sit back and enjoy the ride on a highway, while the car itself handles acceleration, braking, and steering.

The company also unveiled plans recently to offer ride sharing capabilities not just for its cars, but in upcoming trucks and buses as well.

Now Uber is joining the mix and beating Tesla to the self-driving ride-sharing party. From TechCrunch:

Uber revealed today that it would put self-driving Volvo SUVs on the road in Pittsburgh, picking up actual passengers, with a driver on board only to make sure everything goes smoothly. It’s a launch of near-complete autonomous vehicles that seemed to come out of nowhere – just like Uber itself.

In Bloomberg’s telling of the launch of Uber’s self-driving program, they note that Uber starting road-testing their vehicles in May, something the company has managed to keep under wraps until now. Uber also formed its self-driving business in earnest only a little over one year ago, in January 2015 with the hire of John Bares and employees reporting to him. The apparent goal was to replace its human drivers with robots in as short a time as possible, which Bloomberg says could be interpreted by some as “audacious, even reckless.”

Audacious? Yes. Reckless? Perhaps. Ambitious? Most definitely.

The move also flies directly in the face of Tesla, which until now held a monopoly on “self driving” cars (Tesla models still require a driver in the driver’s seat). Uber’s “reckless” foray into the space, and Tesla’s ambitions for ride-sharing have put the two companies a collision course that cannot be avoided.

So while Uber doesn’t make cars, it’s definitely a shaping up to be a major competitor to Tesla — and vice-versa.

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Tesla shares were mostly flat in afternoon trading at $223.12. TSLA has fallen about 7% since the start of 2016, versus a 7% rise in the benchmark S&P 500 during the same period.

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