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Reuters//Lucy Nicholson
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NON-DENIAL DENIAL

Tesla CEO Elon Musk on potential Uber partnership: “Hmmm”

By Shelly Banjo

Reporter

Could a partnership between electric carmaker Tesla Motors and ride-sharing company Uber be in the making?

During a conference call discussing Tesla’s second-quarter financial results, an analyst asked Tesla CEO Elon Musk about recent proclamations from Uber CEO Travis Kalanick that if Tesla produces autonomous cars by 2020, he would buy all of them for his ride-sharing service. The analyst also asked Musk if Tesla would consider operating its own ride-share business.

The questions were met with a bit of hemming and hawing, followed by awkward silence. Here’s the exchange:

Morgan Stanley analyst Adam Jonas: [Venture capitalist and Tesla board member] Steve Jurvetson was recently quoted saying that Uber CEO Travis Kalanick told him that if by 2020, Tesla’s cars are autonomous, then he’d want to buy all of them. Is this a real—I mean, forget like the 2020 for a moment. But is this a real business opportunity for Tesla supplying cars to ridesharing firms? Or does Tesla just cut out the middleman and sell on-demand electric-mobility services directly from the company on its own platform?

Elon Musk: Hmmm, that’s an insightful question.

Adam Jonas: You don’t have to answer it.

Elon Musk: [Long pause] I think—I don’t think I should answer it.

Adam Jonas: Okay, let’s move on. … Sometimes you can tell more from the non-answer than the answer.

What doesn’t quite shine through in the transcript is how Musk seemed to clam up at the question, opening up more questions than answers about what a future Tesla-Uber tie up might look like.

Tesla’s big plans to produce 500,000 cars with autonomous functions by 2020 has sparked interest from Uber because the ride-sharing company stands to save a lot of money—and avoid legal and employment headaches—by having autonomous cars drive customers around instead of hundreds of thousands of drivers. For Tesla, having a big customer like Uber lined up for a still nascent and somewhat frightening technology could be a big win. And getting into the ride-sharing business, albeit a less likely move, could provide big competition to Uber, Lyft, and other ride-sharing companies.

With Elon Musk’s reputation of forging into untested areas, the idea might not be too far off.

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