Testing Tesla’s Self-Driving Technology

I knew I was on the right track when the salesman told me that the customer who just preceded me for a Tesla Model X 90D SUV was the Golden State Warriors star basketball player, Stephen Curry. Well, if it’s good enough for Stephen, then it’s good enough for me.

Last week, I received a call from Elon Musk’s office to test the company’s self-driving technology embedded in its new vehicles for readers of the Diary of a Mad Hedge Fund Trader. I did, and prepare to have your mind blown!

I was driving at 80 MPH on CA-24, a windy eight-lane freeway that snakes its way through the East San Francisco Bay mountains. Suddenly the salesman reached over and flicked a lever on the left side of the driving column. The car took over! There it was, winding and turning along every curve, perfectly centered in the lane. As much as I hated to admit it, the car drove better than I ever could. All that was required was for me to touch the steering wheel every five minutes to prove that I was not sleeping.

The cars do especially well in rush-hour driving, as it is adept at stop-and-go traffic. You can just sit there and work on your laptop, read a book, or watch a movie on the built-in 4G Wi-Fi HD TV. When we returned to the garage the car really showed off. When we passed a parking space, another button was pushed, and we perfectly backed 90 degrees into a parking space, measuring and calculating all the way. The range is 255 miles, which I can recharge at home at night from a standard 220-volt socket in seven hours. The chassis can rise as high as 8 inches off the ground so it can function as a true SUV.

The “ludicrous mode,” a $10,000 option, takes you from 0 to 60 mph in three seconds. However, even a standard Tesla can accelerate so fast that it will make the average passenger carsick.

Here’s the buzzkill. Tesla absolutely charges through the nose for extras. The 22-inch wheels are $5,500, the third row of seats to get you to seven passengers is $4,000, the premium sound is $2,500, leather seats are $2,500, and the self-driving software is $2,500. A $750 tow hitch will accommodate a ski rack on the back. There is a $1,000 delivery charge, even if you pick it up at the Fremont factory.

It’s easy to see how you can jump from an $88,000 base price to a total cost of $130,000, including taxes. The middle row of seats DOESN’T fold down flat, limiting your cargo space to 6 feet long and 3 1/2 feet wide. So, if you are a frequent hauler of surfboards and skis, as I am, you will have to order the six-seat configuration and squeeze them between the two middle row seats.

My company will be purchasing the car under Section 179 of the International Revenue Code. The car qualifies because it weighs more than 6,000 pounds and is therefore a truck under tax law. This allows me to deduct the entire $130,000 cost of the vehicle up-front, plus the maintenance and insurance costs for the entire life of the car. However, I will have to maintain a mileage log as a hedge against any future IRS audits. Ironically, Section 179 was enacted as a subsidy for consumer purchases of the eight-mile per gallon Hummer, which was originally built by AM General and owned by General Motors (GM).

After several attempts to sell the division failed, production was permanently shut down. However, the tax subsidies live on for any like-designed vehicle. What was really amazing was to learn how far the technology has moved forward for my 6-year-old Tesla Model S-1. The range is now 310 miles. Only four-wheel drive versions are now made. And it too has the self-driving software.

It looks like I’ll have to buy two Tesla’s this year.

As for “drop-dead’ curb appeal, nothing beats the Model X. Concerning the stock, not so much.