Baron Capital Chairman and CEO Ron Baron recently saw first-hand how Tesla’s self-driving technology is developing while touring near the company’s California campus.
Billionaire Investor told CNBC on Thursday that he visited Elon Musk’s SpaceX near Los Angeles on Monday morning, meeting with engineers and finance staff. Then in the afternoon he headed to the coast at Tesla to see employees working on self-driving technology and the “geeks.”
Baron said the 12th iteration of the technology benefited from the vast amount of data collected by Tesla cars and more computing power driven by artificial intelligence. This came after earlier versions required more hand coding, which slowed down progress.
“People can’t do this. Now they have computers to figure it all out. So now you are on the cusp of autonomous driving in your car,” he explained. “So I said, ‘Okay, show me.’
Tesla employees discussed the technology with him for a couple of hours. Afterwards, Baron told them he wanted to see how it worked before he had to return to New York.
So they got into a car in the parking lot, accompanied by an analyst and two Tesla employees, he recalls.
“We’re sitting in the car and it’s like, ‘Where do you want to go?’ – continued the Baron. “I said, ‘I want to see Steve Jobs’ house.’ And they say, “OK,” and dial the address.”
The car drove off on its own, driving through the Tesla parking lot and waiting for traffic to pass before entering the road.
He turned again and drove behind other cars. After reaching the stop sign at the intersection, the vehicle waited for other drivers before turning to take its turn, checking traffic in both directions at the same time.
The pedestrian then began to cross the street and the car stopped, Baron said. The pedestrian waved to the waiting car, which then resumed driving.
“Then he pulls up, turns left and heads towards Steve Jobs’ house,” he added. “It’s a nice house, but it’s just a house.”
After that, the car drove back: “It went on its own.” When CNBC asked about the timing of Tesla’s self-driving capabilities, Baron simply replied, “Now.”
Tesla did not immediately respond to Fortune request for comment.
Tesla’s first-hand demonstration of self-driving technology comes at a critical time for Musk’s electric vehicle company. Tesla on Tuesday reported a sharp drop in first-quarter profit as falling sales and lower prices hit profitability.
But Wall Street breathed a sigh of relief when Musk also said Tesla was moving forward with a cheaper electric vehicle model, after some analysts previously worried he would instead prioritize his robo-taxi ambitions. Meanwhile, Tesla also announced job cuts and a number of top managers are leaving the company.
For his part, Baron remains bullish on Tesla shares, which represent the largest position in his portfolio. Citing low-cost cars and robo-taxi, he predicted stocks “will skyrocket. Now it’s rock bottom.”
However, he also expressed some disappointment at the stock’s earlier performance, which is up just 1% from last year and overall down since the start of 2021.
“It’s not that exciting to grow 1% in a year when the market is so strong,” he told CNBC. “I look around all the time and see everyone getting rich – and I’m not poor, but I haven’t made much progress in the last three years, so I think it’s like a rubber band – I’m going to catch up again.”