Car Wars

Travis Kalanick Says Elon Musk Tried to Trick Him into Making a Huge Mistake

Apparently it backfired.
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From Bloomberg/Getty Images.

When Apple, the world’s most valuable public company, invested $1 billion last year in Uber’s biggest rival in China, Travis Kalanick was rattled. Already hemorrhaging money in his bid to take over the Chinese ride-hailing market, the Uber C.E.O. reportedly called up Tesla’s Elon Musk with an unusual proposal: to team up on developing driverless cars to take on Apple together.

“I said, ‘Look man, we should partner,’ ” Kalanick recalls in Wild Ride, a new book on Uber’s bid for world domination, written by Fortune’s Adam Lashinsky and read in advance by Bloomberg this week. But Musk rejected the idea, Kalanick says. “Elon spent the rest of the call convincing me that it’s too far out, and it’s not realistic, that I should just stick to what we do best and be focused, or I’m going to f--- it all up. That’s when I knew Tesla was competing.”

At the time, both Uber and Tesla were working on autonomous-driving technology. According to Kalanick, one of his top deputies discovered that Tesla had made self-driving cars a priority. (Tesla did not immediately respond to a request for comment. A source told Bloomberg that though Musk rebuffed Kalanick’s offer to partner, he didn’t try to tell Kalanick to avoid working on self-driving cars.)

In the days after Musk turned down Kalanick’s offer to work together, Musk revealed his “Master Plan, Part Deux,” a 1,500-word manifesto outlining the future of Tesla—a future that included Musk’s competing vision for his own autonomous, on-demand taxi fleet, composed of Tesla vehicles rented out by their owners when not in use. “When true self-driving is approved by regulators, it will mean that you will be able to summon your Tesla from pretty much anywhere,” Musk wrote. “You will also be able to add your car to the Tesla shared fleet just by tapping a button on the Tesla phone app and have it generate income for you while you're at work or on vacation, significantly offsetting and at times potentially exceeding the monthly loan or lease cost.”

In retrospect, keeping a distance from Uber and its self-driving ambitions may have been a prescient move for Musk, if for no reason other than the fact that Uber is currently fighting a lawsuit that could potentially devastate its self-driving ambitions. This week, Judge William Alsup issued a partial injunction, ruling that Anthony Levandowski, the elite engineer at the epicenter of the intellectual-property lawsuit Google filed against Uber, could no longer work on any of Uber’s laser-sensor technology projects, though the company can continue developing autonomous cars for now. Tesla, meanwhile, is pursing a completely different approach to driverless cars, combining cameras and other sensors with artificial-intelligence software. It is possible that, like Blu-ray and HD DVDs, only one technology will ever see mass adoption.