CEO of Tesla Elon Musk has announced plans to unveil the much-awaited Robotaxi on the 8th of August.
Musk posted this announcement on his X handle after denying reports that the company would cancel its lower-priced EV, typically referred to as the Model 2.
Tesla’s robotaxi reveal came on the heels of a report by Reuters that the company had abandoned Musk’s long-touted plan to manufacture an electric car model selling close to $25,000 to drive adoption in the mass market.
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Recall that Musk has promised shareholders a robotaxi for years but has not yet managed to deliver on his self-driving dreams and promises. The recent plan to roll out Tesla’s Robotaxi sent the company shares higher on Monday. The stock was up 4.7% at $172.71, while the S&P 500 and Nasdaq composite were but close to break even.
The surge in share price is coming after the company reported worse-than-expected first-quarter earnings for 2024 on April 2.
Tesla delivered about 387,000 vehicles over the first three months of the year, falling short of analysts’ expectations of 457,000. This marked a 9% decline compared to 423,000 deliveries recorded in Q1 2023,
The EV company has suggested that its next-generation vehicle platform will underpin both a cheaper car and the dedicated robotaxi, and the vehicles are expected to be similar.
Notably, Musk has continued to bet that Tesla customers and shareholders will stick with the Tesla brand regardless of self-driving delays.
However, despite the announcent to roll out Tesla Robotaxi, the managing partner and co-founder of The Future Fund LLC, an SEC registered investment advisor, Gary Black said investors are not excited about the unveil until Tesla can provide assurance FSD will be 99.99% intervention-free, and that the company is prepared to assume liability for injury or damages to appease regulators tasked with granting robotaxi licenses.
In his words,
“Our view on $TSLA is that investors will not get excited Electric-vehicle sales have struggled industrywide, and Elon Musk’s automaker is no exception to economic forces. Until TSLA can provide assurance FSD will be 99.99% intervention-free, and that TSLA is prepared to assume liability for injury or damages to appease regulators tasked with granting robotaxi licenses.
“TSLA investors are so far believing the robotaxi unveil potential, as we saw Friday after the market closed and Elon tweeted the Aug 8 robotaxi event. Hopefully, this won’t delay production of the TSLA $25K compact.”
Gary’s statement is coming following Tesla’s disappointing deliveries in the first quarter of 2024, but the problems exceed deeper than a single quarter. Tesla’s sales haven’t been boosted by lower prices, and that indicates a demand problem.
The company shares have tanked 34% this year. Investors raise doubts over whether the EV maker will return to form. As Electric vehicle sales have struggled industrywide, and Elon Musk’s automaker is no exception to economic forces, the company has carried out numerous price cuts of its cars significantly hurting its profits to boost sales.