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Tesla-Robot Unveiling Cybercab Prototype and Many More at Tesla company
Tesla’s CEO Elon Musk is set to reveal the company’s plans for a self-driving “robotaxi,” potentially marking a significant breakthrough for investors. This development may validate the decision to delay a highly anticipated vehicle launch.
Musk first introduced the idea of a robotaxi network in April 2019, envisioning a fleet of autonomous Teslas that could transport passengers when not in use by their owners. He projected that a robotaxi would debut in 2023 and enter production by 2024, but those timelines were not met.
Now, after further delays, Tesla appears ready for a “product launch” of the robotaxi, which Musk refers to as the Cybercab. The success of this unveiling could parallel the positive reception of the Model X in 2012 or mirror the disappointment of the 2021 Optimus robot reveal, which was criticized for its lack of substance.
The “We, Robot” event is scheduled for Thursday at 10:00 p.m. ET/7:00 p.m. PT at Warner Bros. Discovery’s studio near Los Angeles. The event will draw Wall Street analysts, Tesla enthusiasts, and investors, and will also be livestreamed on X, Musk’s social media platform.
What to Expect
The Cybercab is anticipated to be Tesla’s first fully autonomous vehicle, eliminating the need for a driver. Currently, Tesla’s electric cars are equipped with some self-driving features, but they still require human oversight.
Tesla’s Full Self-Driving (FSD) and Autopilot systems have faced scrutiny, including legal challenges and investigations by the U.S. National Highway Traffic Safety Administration, which has reviewed hundreds of accidents involving these technologies.
Bloomberg News reports that the Cybercab is designed with two front seats and distinctive upward-opening doors, reminiscent of “butterfly wings,” aligning with concept illustrations found in Walter Isaacson’s recent biography of Musk.
Musk has hinted at showcasing additional innovations during the event, potentially related to three “mystery vehicles” teased at a previous shareholder meeting. There’s also speculation he will discuss integrating FSD technology into the Tesla Semi truck, which has seen limited release.
Analyst Gene Munster from Deepwater Asset Management anticipates that three vehicles will be revealed, including a rumored autonomous passenger van known as the “Cybervan” and a $25,000 Model 2, which may have been scrapped. Munster expects to see a prototype of the Cybercab and previews of the other vehicles.
Competitive Landscape
While Tesla is not new to artificial intelligence and autonomous technologies, it faces stiff competition. Rivals like Waymo have been operating autonomous vehicles for years, building valuable data without the controversies associated with Tesla.
“Waymo has a significant lead, offering thousands of autonomous rides weekly in major cities, while Amazon’s Zoox is set to launch next year,” said Will Rhind, CEO of GraniteShares.
Tesla must also navigate regulatory hurdles and public skepticism about autonomous vehicles. Notably, the upcoming event will take place on private roads, as the company has not yet sought deployment permits from California authorities, according to critic Gordon Johnson.
However, Tesla has amassed over 1.5 billion miles of data from its FSD system, which is categorized as a level 2 automation system.
“There are many questions that industry stakeholders and investors will want answered, including details on insurance, vehicle pricing, regulatory approval timelines, and operational logistics,” commented Dan Ives, an analyst at Wedbush Securities.
Business Model Insights
In June, Musk described his vision for a tesla-robot network as a blend of Airbnb and Uber, allowing vehicle owners to opt-in their cars for ride-hailing services. He emphasized that owners could earn money while their cars worked for the service.
“I’m highly confident that it will far exceed the value” of monthly payments on the vehicles, Musk stated at a shareholder meeting.
Tesla plans to take a percentage of the revenue generated from this service, which analysts suggest could be years away. The timeline for launching the robot-taxi network remains uncertain, and many investors are eager for more clarity on this during Thursday’s event.
JPMorgan analysts have indicated that substantial revenue generation is unlikely in the near term, and Guggenheim Securities’ Ronald Jewsikow mentioned that a credible path to robot-taxi commercialization within the next 12 to 24 months seems improbable.
Ark Investment Management has projected that robotaxis could represent 90% of Tesla’s value by 2029, with stock prices potentially soaring to $3,100 per share. Conversely, if the network is not operational by then, the price target could drop to around $350 per share.
Ark CEO Cathie Wood has suggested that analysts may need to revise their profit forecasts for Tesla due to the tesla-robot initiative, predicting 80% gross margins. “This is not about if, but when for Tesla. The key questions are how quickly they will expand nationally and globally,” Wood noted.
