Tesla is now touting a compact electric pickup truck, a strategic pivot that comes as its long-hyped Cybertruck continues to underperform.

The potential shift was revealed by Lars Moravy, Tesla’s vice president of engineering, who said the company has been actively considering a smaller sibling to the Cybertruck, particularly with an eye on international markets where demand and regulatory requirements sharply differ from the U.S.

“We always talked about making a smaller pickup,” Moravy said during an event in California over the weekend, hosted by Tesla investors and owners. He explained that such a model could align with future plans for Tesla’s robotaxi platform, saying, “That kind of service is useful not just for people, but also for goods… We’ve definitely been churning in the design studio about what we might do to serve that need.”

This marks a possible recalibration of Tesla’s electric truck ambitions, especially as Cybertruck sales remain far below expectations. Tesla had predicted annual sales of over 250,000 units, but the reality has been sobering: just under 39,000 Cybertrucks were sold throughout 2024, and approximately 11,000 have been sold so far in 2025, according to industry estimates. That figure is a fraction of what Tesla envisioned when it launched the “apocalypse-proof” truck with high hopes and cinematic flair in 2023.

At the heart of the problem is the Cybertruck’s design and pricing. Initially promised at a starting price of $39,900, the actual entry-level model now starts at over $60,000, with premium trims inching close to the $100,000 mark. The vehicle’s hefty 6,000kg frame and sharp-edged design have further restricted its global expansion. The truck is not road-legal in many markets, including Europe and China—Tesla’s two largest markets outside the U.S.

Authorities in the UK seized one of the first Cybertrucks imported into the country earlier this year, while another in the European Union had to be modified to pass local safety regulations due to its angular, rigid body. While Tesla has managed to expand Cybertruck sales to Canada, Mexico, Saudi Arabia, the UAE, and Qatar, these remain relatively limited markets compared to the regulatory-tight European and Chinese auto sectors.

Meanwhile, Tesla’s overall vehicle sales have continued to slump. In the second quarter of 2025, the automaker recorded a 13.5% year-over-year drop, marking the second consecutive quarter of declining sales. The disappointing numbers come at a pivotal time for the company, which has been battling mounting criticism over its controversial self-driving technology claims.

California’s Legal Challenge

Tesla’s ability to continue selling vehicles in its home state of California is also under scrutiny. The California Department of Motor Vehicles has concluded a weeklong court hearing on a lawsuit it filed in 2022, accusing Tesla of misleading consumers about the capabilities of its “Full Self-Driving” (FSD) and “Autopilot” systems. The DMV is seeking to suspend Tesla’s sales license in the state for at least 30 days and to impose monetary penalties.

The suit argues that Tesla falsely marketed its driver-assist features as nearly autonomous, citing statements from the company’s website that implied the cars could operate from departure to destination without human input. DMV Commander Melanie Rosario, testifying as a witness, told the court she found Tesla’s branding around “Autopilot” and “FSD” to be confusing and contradictory, saying it gave the impression the vehicles could drive themselves despite disclaimers in the fine print.

Tesla’s legal team pushed back, arguing that the company had always stated drivers must remain attentive and that the systems are not fully autonomous. However, multiple witnesses, including experts in vehicle automation and advertising law, suggested that the language used by Tesla could indeed mislead consumers. The case remains pending, but legal analysts have flagged it as one with potentially far-reaching implications for Tesla’s operations nationwide.

Adding to Tesla’s woes is the public backlash tied to CEO Elon Musk’s recent appointment as the face of the White House’s controversial DOGE Office, which spurred protests outside Tesla dealerships across the country earlier this year. The political spotlight, coupled with growing consumer dissatisfaction, has only intensified the company’s mounting image problems.

Further complicating the situation are several lawsuits. In Florida, a wrongful death case alleges that a Tesla operating on Autopilot struck a parked SUV, killing a 22-year-old woman, while another class-action lawsuit and federal probe are examining reports of “phantom braking,” where Teslas suddenly slam on the brakes without cause, creating safety hazards at high speeds.

Amid the turbulence, a compact pickup could serve as a fresh offering to re-engage markets increasingly wary of Tesla’s bolder bets. Although Moravy noted that it’s still at the design phase, it is not clear whether a smaller truck will succeed where the Cybertruck stumbled.

Nations rise when leaders architect visions. Companies advance when business leaders articulate visions. Out of those visions are missions encapsulated. Simply, the enduring success of firms is intrinsically linked to a clear mission, relentless innovation, and strategic growth. A firm’s mission serves as its guiding star, articulating its fundamental purpose and the value it aims to deliver to stakeholders.

That clear purpose becomes the bedrock upon which all innovation is built, ensuring that new ideas and products are not merely novelties but purposeful advancements that align with the company’s core identity and market needs.

When they say in ancestral Igbo that a good product sells itself, the message is simple: through great products, product-market fits are readily attained. Oliver de Coque has noted that great music comes from God; and I paraphrase that great products emerge out of an innovation vision.

Innovation, in this context, is a continuous pursuit – from disruptive technologies to incremental process improvements – all designed to create new value, differentiate the firm, and overcome market frictions, ultimately driving its competitive edge.

Growth, therefore, is the natural outcome of a well-defined mission married with sustained innovation. It’s not just about expanding size but about enhancing market relevance and impact. Tekedia highlights that true growth involves scaling operations, capturing new market segments, and creating sustainable value for stakeholders. This strategic expansion allows firms to build “category-king” positions, solidifying their presence and influence.

Vision. Mission. By consistently revisiting their mission, fostering a culture of innovation, and executing intelligent growth strategies, firms can navigate dynamic landscapes, secure long-term viability, and contribute meaningfully to the broader economy.

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Samsung Electronics has secured a landmark $16.5 billion contract to supply semiconductors to Tesla, marking one of the largest chip deals in the electric vehicle and AI sectors.

The agreement, effective from July 26, 2025, will run through December 31, 2033, according to a regulatory filing by Samsung and a confirmation post by Tesla CEO Elon Musk on X.

Although Samsung initially withheld the counterparty’s name, citing a confidentiality request “to protect trade secrets,” Musk later confirmed on X that Tesla is the customer.

“Samsung’s giant new Texas fab will be dedicated to making Tesla’s next-generation AI6 chip,” Musk wrote. “The strategic importance of this is hard to overstate. Samsung currently makes AI4. TSMC will make AI5, which just finished design, initially in Taiwan and then Arizona.”

Musk added that Tesla will actively participate in optimizing Samsung’s chip production.

“Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress,” he said.

He also suggested the actual value of the agreement could exceed $16.5 billion.

A Strategic Bet on AI and EV Hardware

The new deal gives Tesla a critical hardware edge in its race to dominate the AI-driven electric vehicle space. The AI6 chip is believed to power Tesla’s next-generation Full Self-Driving (FSD) and AI inference systems, potentially transforming the company’s vehicles into more autonomous, intelligent machines. Samsung, in turn, gains a marquee client and a fresh opportunity to regain ground in the AI semiconductor race — an area where it has recently fallen behind rivals like SK Hynix and Micron.

The agreement is a boost to Samsung’s foundry business, which has seen sluggish orders in recent quarters and has struggled to match AI demand for memory chips. As recently as April, the company had set a goal to start mass production of 2-nanometer chips, the most advanced manufacturing node currently in development. These chips feature smaller, more compact transistors, delivering greater processing power and energy efficiency — key requirements for high-performance AI workloads.

South Korean media have also speculated that Qualcomm may soon join Tesla in placing orders for chips manufactured on Samsung’s 2nm technology.

Samsung Rallies on News Despite Tough Earnings Outlook

Investors cheered the Tesla news, sending Samsung’s shares soaring more than 6% on Monday, their highest level since September 2024. The deal comes just days ahead of Samsung’s scheduled earnings release on Thursday, where the company is expected to report a more than 50% drop in second-quarter profit. Analysts attribute the sharp decline to underwhelming foundry orders and weak memory chip sales, particularly in high-bandwidth memory (HBM), where Samsung trails rivals.

While SK Hynix has emerged as the lead supplier of HBM chips to AI giant Nvidia, Samsung has reportedly struggled to get its latest HBM offerings certified. A recent report indicates that Nvidia’s validation of Samsung’s new HBM chips has been postponed until at least September, further delaying its attempt to regain footing in a fiercely competitive market.

Foundry Wars and AI Chip Race Intensify

Samsung’s renewed push in the foundry space — particularly with U.S.-based manufacturing — appears to be a calculated move to gain ground against Taiwan Semiconductor Manufacturing Company (TSMC), the dominant force in global chip fabrication. TSMC is currently building out major operations in Arizona and has already secured Tesla’s AI5 chip production.

Samsung now ensures it will remain integral to Tesla’s long-term roadmap by securing the AI6 chip order, especially as competition in AI hardware intensifies. With governments and corporations increasingly seeking supply chain resilience and geographic diversification, Samsung’s U.S. fab in Texas is positioned to play a central role.

But the company isn’t out of the woods yet. Despite the Tesla deal, Samsung warned in its filing that investors should exercise caution, noting that “main contents of the contract have not been disclosed… and there remains a possibility of changes or termination.”

Nevertheless, the strategic value of the partnership cannot be overstated. It is expected to secure the chip supply for Tesla’s future vehicles and AI systems. For Samsung, it’s a chance to reassert itself as a top-tier player in both the foundry and AI semiconductor race, at a time when tech giants are scrambling for silicon.