Synopsis
Shashua's challenge was that consumer AVs were still years away due to concerns over safety, regulation, cost, and consumer acceptance. A nearer term use case for AVs was the robotaxi market - fully autonomous, driverless taxis. Shashua and his team were excited about the potential of robotaxis to change the future of mobility, projecting that the market would grow to $160 billion globally by 2030. Mobileye believed that it could generate at least $15 billion in annual robotaxi revenue by the end of the decade. Equally important, Shashua viewed robotaxis as a necessary first step toward consumer AVs. Mobileye could use its experience in robotaxis to improve AV technology, address regulatory challenges, and build high definition maps. The long-term question facing Mobileye was whether to: 1) invest billions of dollars to build-out a global, vertically integrated robotaxi business; 2) use robotaxis as an opportunity learn and then revert back to a horizontal supplier of AV chips and software; and/or 3) do both? During most of Intel's history, the company had been a horizontal semiconductor company which avoided vertically integrating into its customers' businesses. Should Shashua make the case that it was time for a change - and Intel should run a full-stack vertical robotaxi company? Each strategic choice had different capital requirements, risk profiles, and margin opportunities. Shashua needed to decide which direction to recommend to Gelsinger.
