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Elon Musk About Tesla Making a Phone: “We Could, but Hopefully It Isn’t Needed” – Explains Why It Will Be Easy For Tesla To Produce a Phone

As Tesla grows to become more than an auto maker, Elon Musk has revealed an often-overlooked advantage Tesla has if the company chooses to create a smartphone; this advantage is Tesla’s in-house operating system.
Tesla, Elon Musk

Only a few years ago, cars were primarily mechanical products, whereas technology was left to the tech giants in Silicon Valley. However, in large part due to Tesla’s contribution, the line between tech and auto manufacturing has blurred to the point that vehicle manufacturers are now as much tech companies as they are car makers.

This shift primarily happened due to the emphasis on software. Software, which was mostly an afterthought for most automakers, now plays a large role in determining user experience in any vehicle.

As I have already alluded to, Tesla is at the forefront of offering the most polished software experience in the automotive world.

This has given Tesla a reputation as more than an automaker. When discussed in the media, the EV maker is mentioned together with Apple, Google, Nvidia, and Microsoft, more than it is next to GM and Ford.

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Tesla’s technological prowess has become even more important as the company races to create the world's first level 5 fully self-driving vehicle.

Considering these facts together, there have been long-standing questions about whether the EV maker will officially enter the tech market and produce a Tesla-branded smartphone.

Mostly, no one took these suggestions to heart; however, today, Elon Musk addressed the issue of the Tesla phone.

Musk commented on the issue of a Tesla phone in response to a research note by Morgan Stanley’s Adam Jonas, who suggested Tesla would make a phone. Morgan Stanley’s research was titled “Will Tesla Do a Phone? Yeah, We Think So.”

Some of the key points Morgan Stanley highlights to come to this conclusion include…

• From our continuing discussions with automotive management teams and industry experts, the car is an extension of the phone. The phone is an extension of the car. The lines between car and phone are truly blurring.

• For years, we have been writing about the potential for Tesla to expand into edge computing domains beyond the car, including last October, when we described a mobile Al assistant as a 'heavy key.' Following Apple's WWDC, Tesla CEO Elon Musk re-ignited the topic by saying that making such a device is 'not out of the question.' As Mr. Musk continues to invest further into his own LLM/genAl efforts, such as 'Grok,' the potential strategic and user-experience overlap becomes more evident.

• From an automotive perspective, the topic of supercomputing at both the data center level and the edge is highly relevant, given that the incremental global unit sold is a car that can perform OTA firmware updates, has a battery with a stored energy equivalent of approximately 2,000 iPhones, and has a liquid-cooled inference supercomputer as a standard kit. What if your phone could tap into your vehicle's compute power and battery supply to run Al applications?

• Edge compute and Al have brought to light some of the challenges (battery life, thermal, latency, etc.) of marrying today's smartphones with ever more powerful Al-driven applications. Numerous media reports have discussed OpenAl potentially developing a consumer device specifically designed for Al.

• The phone as a (heavy) car key? Any Tesla owner will tell you how they use their smartphone as their primary key to unlock their car as well as running other remote applications while they interact with their vehicles. The 'action button' on the iPhone 15 potentially takes this to a different level of convenience.

Here, Morgan Stanley shows how the car has become more than a mechanical object and packs similar or better tech features than a smartphone. Adam Jonas specifically points out that in some areas, modern cars are like smartphones, and in other areas, cars are better.

  1. Similar to a smartphone, a Tesla car can receive over-the-air software updates that add brand-new functionality or significantly improve the user experience.
  2. Tesla vehicles have battery power equivalent to that of 2000 iPhones.
  3. Tesla vehicles have more powerful AI inference computers than any smartphone (Tesla says the hardware 4.0 autopilot computer has eight times the capacity of Apple’s M3 chip found in Macbooks)
  4. The phone has already become an extension of the car since most Tesla owners use their phones as their primary way of unlocking their vehicle

With all these factors added together, it’s no wonder Morgan Stanley believes it is a logical next step for Tesla to make a phone. Now Musk agrees, adding another often-overlooked advantage Tesla has in tackling the smartphone market.

In response to Adam Jonas's research stating that Tesla will make a phone, Musk wrote, “We could, but hopefully it isn’t needed. Tesla is one of the few companies that has its own tech stack (not iOS, Android, or forked Android).”

The overwhelming majority of smartphones currently in the market either use Apple’s IOS operating system or Google’s Android system and its derivates. This gives the two tech giants an unparalleled advantage and control over the smartphone industry.

However, Tesla has chosen to develop a brand-new operating system for its vehicles based on the open-source Linux operating system. This means Tesla could already leverage the in-house operating system that runs its vehicles and the company’s manufacturing prowess to develop a smartphone.

This is all good, and Tesla has several technological advantages that will make producing a smartphone relatively easy. However, it’s also important to remember that billions of iPhones and Android smartphones are already on the market.

This gives the tech giants a massive first-mover advantage that will be difficult for Tesla to penetrate. As of now, Musk has not made any concrete plans to create a Tesla-branded phone; however, we’ll be sure to keep you posted if we receive any updates on this front.

Until then, visit our site, torquenews.com/Tesla, regularly for the latest updates.

So, what do you think? Would you be interested in switching to a Tesla phone? Do you think such a product will be successful? Let us know your thoughts in the comments below by clicking the red “Add new comment” button.

Image: Courtesy of Tesla, Inc. 

 

For more information, check out: My Tesla Charger Got Stuck and Won’t Unlatch from My Cybertruck – I Found a Secret Cybertruck Compartment that Allowed Me to Solve the Issue

Tinsae Aregay has been following Tesla and the evolution of the EV space daily for several years. He covers everything about Tesla, from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.

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