UPDATED 22:05 EDT / OCTOBER 20 2016

NEWS

Tesla to launch ride hailing in 2017, bans owners from Uber, Lyft

Tesla Motors Inc. will prevent owners of its new self-driving cars from providing ridesharing services on Lyft Inc. and Uber Technologies Inc. and will instead restrict them to using Tesla’s own yet-to-be-detailed ridesharing program.

The discovery came by way of the fine print in a disclaimer about the self-driving functionality on new Model S vehicles.

“Please note that using a self-driving Tesla for car sharing and ride hailing for friends and family is fine, but doing so for revenue purposes will only be permissible on the Tesla Network, details of which will be released next year,” the disclaimer reads.

This isn’t the first time news has come forward that Tesla plans to build its own ridesharing service, but it is the first time it has been mentioned that Tesla owners will be restricted from using competing services.

According to Fusion, the original idea of a Tesla network was first mentioned in the company’s revised master plan released in July, which described the service as follows:

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. This dramatically lowers the true cost of ownership to the point where almost anyone could own a Tesla. Since most cars are only in use by their owner for 5% to 10% of the day, the fundamental economic utility of a true self-driving car is likely to be several times that of a car which is not.

In cities where demand exceeds the supply of customer-owned cars, Tesla will operate its own fleet, ensuring you can always hail a ride from us no matter where you are.

Anti-competitive

Tesla blurs the lines between automobile and software, and as such it might be able to enforce such a ban on people who use their Teslas to drive for Uber and Lyft through the cars terms of service, in a similar way to software makers.

That doesn’t necessarily make it acceptable to owners, however, as essentially Tesla is dictating how a person may or may not use their vehicle. That goes against more than a century of vehicle ownership, let alone that it at least looks anti-competitive.

It’s not clear exactly when the Tesla network would be rolled out other than an announcement will be made “next year.”

Image credit: Robert Couse-Baker/Wikimedia Commons/CC by 2.0

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