Tesla Investor’s Critical Summary of Tesla Robotaxi Event

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Tesla had its big robotaxi event last night. Pre-market, the stock is down nearly 7%. I think it’s fair to say that Tesla unveiled some very cool looking robotaxi concept vehicles, but also did very little to show how or when it’s getting from where it is today to these robotaxis actually being sold to customers and on the road in full operation.

The most bullish hopes for last night’s event would have been the hope that Tesla would launch robotaxi operations in some markets immediately, but that was unlikely. By the end of the year would have been close enough and very bullish. Though, I would hope that most followers and investors would not be expecting that. If they were, they must be disappointed, because there was no mention of that happening. I think the more realistic but bullish expectation was that Tesla would show a production-ready robotaxi, provide a clear timeline for when it would launch as a robotaxi, and indicate which jurisdictions (states) would permit launch by that time. This, to me, was too bullish but I assume must have been what many investors were hoping for.

One very notable Tesla investor, Gary Black, was more skeptical, and I’d say completely in line with my expectations, and thus my reaction to what Tesla revealed. Before I go further, I’m embedding his tweet and then the Tesla reveal video itself if you haven’t watched it (note that the presentation starts about 53 minutes in).

$TSLA “We, Robot” was long on promise and short on specifics and for us, was largely as expected. TSLA did not unveil a $25-$30K compact, but did reveal a 20-person autonomous Art Deco bus. The event didn’t address how Tesla will make the leap from selling supervised FSD to… pic.twitter.com/tCRWxUbkN4

— Gary Black (@garyblack00) October 11, 2024

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So, a few key highlights, including quotes from Tesla investor Gary Black’s tweet:

“TSLA did not unveil a $25-$30K compact, but did reveal a 20-person autonomous Art Deco bus.” So, yeah, the wait for a more affordable Tesla car goes on.
“The event didn’t address how Tesla will make the leap from selling supervised FSD to unsupervised autonomous vehicles.” Indeed. This is the most I was hoping for — some clear explanation of how they’d get from A (where we are today) to B (robotaxi operations). Nope.
“Elon promised TSLA would offer unsupervised FSD by 2025 year-end on current SX3Y and CT models in Texas and California, where miles per necessary intervention are likely the highest, and a production robotaxi before 2027.” Okay, this is something like a plan, but it’s also just the vague kind of prediction/forecast Tesla has provided for several years and then missed targets on. A year+ is still far enough out that one would think a Tesla prediction can’t be super solid, and Elon Musk’s predictions on such timelines in the past have been super poor. Of course, 2027 is far off for an actual production robotaxi, and far enough off than any Tesla prediction right now is more of a wild guess. Naturally, if you were expecting a production robotaxi to be shown last night, you’ve got to be sorely disappointed.
“He did not provide a business model for how the robotaxi would generate revenue other than to say consumers could buy a Cybercab for under $30,000 and entrepreneurs might invest in a ‘flock’ of robotaxis that could work 100 hours/week instead of the roughly 10 hours/week they operate today.” I’m not going to lie — this is where things really got a little off track for me. I know there were strong hints of this, but Musk also proclaimed many times that Teslas with FSD would appreciate in value once they cracked the robotaxi nut. Yet now they plan to sell a robotaxi for only $30,000? How is my 2019 Tesla Model 3 with FSD going to appreciate in value? Were those totally false claims that Musk has given up on? Is there legal recourse for those who feel swindled? I’ll leave it to others to chatter about and potentially hire lawyers for. Not my game. In any case, yeah, it’s a cool Cybercab concept, and similar to what I expected Tesla was working on, but the doors look impractical for a robotaxi and the concept is still far away from production. Overall, this is much more of a miss than a hit, imho.
“Elon did not disclose TSLA’s current intervention efficacy data.” Of course now.
“Musk’s presentation lacked technical details and glossed over topics including regulation or whether the company will own and operate its own fleet of Cybercabs or leverage third-party ride hailing platforms.” Frankly, this feels very similar to a presentation from years ago, with similarly low level of details and far-off grand forecasts you just have to have faith in.
“We very much liked the design of the new $TSLA cybercab. It will be a two seater with two doors that open skyward, with no steering wheel or pedals. The cybercab borrowed heavily from today’s Cybertruck design and was very futuristic looking.” Yes, it looks cool. It also looks like many other concept vehicles shown at auto shows over the years — fun, futuristic, and unrealistic. Will Tesla come through and actually build it. Probably. But on the timeline and at the price projected? I’m not holding my breath.

Tesla is still struggling to get Cybertruck production volumes up and costs down. I’m not saying it won’t do so, just as it did with all of its previous models, but it’s clear there are challenges the company is still facing on this. And there are also issues with reliability and repairability. It is nowhere close to a finished product. So, another vehicle that is a kind of combo of a Cybertruck, a Model 3, and a Model X seems like a fanciful far-off dream that has many hurdles ahead before it is in a customer’s hand. 2027? Maybe. We’ll see.

As far as Full Self Driving (Unsupervised), we really don’t have any more info than we had before 10/10, do we? Any hope for a big announcement about progress on FSD, intervention rates reaching a critical tipping point, or regulatory approval was misguided hope, as we now know.

One thing I wonder: was anyone truly thrilled by the news of the event last night? Aside from seeing the designs of the vehicle concepts, was there anything unveiled at the event that anyone wasn’t really expecting?