Tesla (TSLA, Financial) CEO Elon Musk recently made several ambitious announcements at the highly anticipated Robotaxi event. Musk pledged that Tesla's popular Model 3 and Model Y vehicles would achieve full autonomy in California and Texas next year. Additionally, he introduced plans to produce the autonomous Cybercab for under $30,000 by 2026 and showcased a robot van capable of transporting 20 people within urban settings.
Musk also unveiled a dancing and bartending humanoid robot, indicating Tesla's intent to sell these robots priced between $20,000 and $30,000 each. Despite these exciting prospects, some Tesla investors and experts are seeking more concrete details on how the company plans to transition from electric car manufacturing to becoming a leader in autonomous driving and artificial intelligence.
Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management and a long-term Tesla investor, expressed that while Musk's vision is captivating, Tesla should focus on electric vehicle sales over the next 24 months. He also expressed interest in seeing a more affordable and conventional vehicle from Tesla in the near future.
For years, Musk has promised the release of a $25,000 starting price car, a pledge investors deem crucial for attracting new customers. Although a report in April suggested Tesla had scrapped this project, leading to a decline in Tesla's stock price, Musk later announced plans for a robotaxi, initially scheduled for release in August, but eventually delayed to October.
Musk aims to surpass current autonomous vehicle companies like Alphabet’s (GOOGL) Waymo by adopting a low-cost technological approach. However, Tesla's simpler and cheaper strategy has its challenges, notably the AI technology underpinning its self-driving system, which makes diagnosing accidents or other faults difficult and could raise regulatory concerns.
Creative Planning's Co-Chief Investment Officer Ramesh Poola, a Tesla shareholder, expressed admiration for Musk's presentation but emphasized the need for more details on how Musk plans to monetize new AI and robotics technology. He anticipates regulatory hurdles as Tesla advances toward full autonomy. While the demonstration of prototype vehicles was exciting, Poola believes widespread adoption of self-driving Cybercabs may take three to four years.
Musk's previous plans to operate a fleet of self-driving Tesla taxis were not mentioned at the event, leaving Tesla investors like ARK Investment Management's Head of Investment Analysis, Tasha Keeney, eager for more insights on the associated app. Despite this, Keeney remains hopeful about the proposed autonomous system's deployment in Texas and California next year, seeing it as a step towards launching autonomous taxi services.
In pre-market trading, Tesla saw nearly a 6% drop, reflecting investors' cautious stance amid concerns about competition from cheaper electric vehicle rivals. However, Tesla's stock has surged nearly 50% since Musk's robotaxi announcement in April. In contrast, ride-hailing giants Uber (UBER) and Lyft (LYFT) experienced pre-market upticks, suggesting Musk’s declarations are not perceived as immediate threats to these companies.
