Amazon's latest acquisition did not go unnoticed by Elon Musk. The Tesla CEO took to Twitter to attack Jeff Bezos.
Elon Musk’s saltiness over Jeff Bezos’ growing encroachment on his turf is no longer concealable.
Hours after it was revealed that Amazon (NASDAQ:AMZN) had acquired self-driving startup Zoox at $1.2 billion, the Tesla (NASDAQ:TSLA) CEO alleged that Bezos lacks originality.
In a half-emoji-half-word tweet, Musk labeled Bezos a copycat while linking to an article detailing the acquisition.
This is not the first time Musk attacked Bezos publicly. Years ago, Musk’s go-to plan was to play the contempt card.
Now the stakes are higher, and the meme lord is employing his favorite weapons.
Here are three reasons why Jeff Bezos’s latest move terrifies Elon Musk.
According to Guidehouse Insight’s 2020 ranking of firms developing autonomous cars, Tesla ranks 18th. The electric carmaker’s overall score in the survey was 31.6.
Zoox, on the other hand, ranks ninth. It boasts an overall score of 66.5. Citi Research has also rated Zoox’s improvement in the space as “notable.”
Per sources, Amazon intends to collaborate with Zoox in developing robotaxis. Elon Musk has long claimed that Tesla’s self-driving technology will unlock the full value of its cars when it reaches full autonomy.
ARK Invest has even projected that Tesla’s stock could rise above $20,000 when its self-driving technology reaches Level 5 autonomy. The stock is currently trading below $1,000.
With Zoox’s technological edge, coupled with Amazon’s legendary competitiveness, the path just got tougher for the much-hyped Tesla’s robotaxi.
Amazon currently has about $43.7 billion cash on hand. Tesla’s cash pile stands at $6.3 billion. The amount rose because of a $2 billion stock offering less than four months ago.
Tesla is yet to generate an annual profit, a feat that Amazon achieved 17 years ago.
With its parent company holding such a cash pile, Zoox is now in a better position to bring its ambitious vision to reality without being hindered by resources.
And amid the pandemic, Amazon has become one of the biggest beneficiaries of the stay-at-home orders. This puts the Bezos-led firm in a position to keep its cash pile growing.
Tesla, on the other hand, deals with consumer discretionary products. It faces multiple risks that will not go away until the global economy starts improving. Tesla may have to burn through its cash pile to stay afloat, which could also mean scaling back some aspects of the business.
Tesla’s success or failure concerning battery electric vehicles and autonomous car technology solely rests on its efforts. Amazon has hedged its bets, though, increasing the odds of success.
After acquiring Zoox, Amazon assured that the startup would remain independent with no changes to its leadership. With Amazon as its backer, Zoox has the potential to boost self-driving autonomy significantly.
Besides Zoox, Amazon last year invested in autonomous car firm Aurora Innovation. Amazon also invested in Rivian, an electric vehicle startup that is also working on autonomous cars.
With the bets spread among several startups, surely one of them will be a home run. For Tesla, though, all the eggs are in one basket.
Disclaimer: This article represents the author’s opinion and should not be considered investment or trading advice from CCN.com. The author holds no investment position in the above-mentioned securities.
Last modified: September 23, 2020 2:01 PM