Refusing to drive could work when starting out, but handling changing conditions on the road is harder.
A scaled request for the driver to take over as conditions get worse can train the driver not to use the self-driving system in adverse conditions, so hopefully it wouldn't have to refuse (unless the driver is negligent).
Getting back to the OP, Musk may have a point: people are terrible at evaluating risk for low-probability/high-consequence events like a car accident, so LIDAR might lose in the market even if it is worth it. But if there were standards for when the car asked the driver to take over and LIDAR is able to pester its drivers less often because it is more capable, then perhaps LIDAR can justify its place in the market.
A scaled request for the driver to take over as conditions get worse can train the driver not to use the self-driving system in adverse conditions, so hopefully it wouldn't have to refuse (unless the driver is negligent).
Getting back to the OP, Musk may have a point: people are terrible at evaluating risk for low-probability/high-consequence events like a car accident, so LIDAR might lose in the market even if it is worth it. But if there were standards for when the car asked the driver to take over and LIDAR is able to pester its drivers less often because it is more capable, then perhaps LIDAR can justify its place in the market.