Chart analysis of Tesla's post-market performance on Friday, October 11th.
Core Tips🔔:I will be willing to pay the price of rare large-scale profits and even floating losses for several years due to the upward trend of Tesla as the main trend and long-term trend of investment and trading symbols. However, please do not forget that the most core of the historical development of the bullish and bearish U.S. securities market has always been the progress of high technology, such as Microsoft giving birth to Bill Gates; Apple giving birth to Steven Paul Jobs; Tesla giving birth to Elon Reeve Musk. Wall Street has always been willing to provide high valuations to listed companies with promising development prospects even without realizing the expected profits. You should be prepared to pay the price of missed complete uptrends if you blindly refuse high-growth technology companies out of hesitation and indecision. You should be even more prepared to pay a much more painful price for trying to achieve both long and short sides and not hesitating to short sell Tesla. Up to now, Tesla has invested over 10 billion dollars in transforming from an electric car manufacturer into a high-tech growth listed company deeply involved in Artificial Intelligence development and applications. He is an entrepreneur, business tycoon, Fellow of the Royal Society of the United Kingdom, Member of the American Academy of Engineering. He is the founder, chairman, CEO, and chief engineer of SpaceX, investor, CEO, product designer, former chairman of Tesla, founder of Boring Company, co-founder of Neuralink and OpenAI, and also CTO and chairman of X Company. In 2022, he became the world's richest person with a fortune of 219 billion dollars.
Tesla's bullish camp has split, with some strategic options choosing to reduce their Tesla shares. Although this time Wall Street's capital market has chosen to distrust Tesla, opting to sell off some stocks. However, the 214.380 is close to the classic upward trend channel at a 45-degree angle of the US dollar index and US stocks. The profit chip ratio has dropped to 26.64%, with an interval overlap of 59.55%, experiencing intense momentum and kinetic energy fluctuations. The greatest bullish sign in financial investment trading is when it falls sharply. Previously, Tesla's profit chip ratio has been fluctuating in the high ratio zone and near-high value ratio zone, with extremely limited potential for stock price growth in the short term. Even if there is a strong rally, it will still need to be corrected by a substantial decline afterwards. Moreover, this time Tesla's level of technical perfection is not high, so the main controlling forces have decisively chosen to move downwards. FSD and Cybercab (online taxi) belong to AI's deep development applications, which have a significant difference compared to AI projects with large fault tolerance spaces.
Wall Street's capital has also notified Tesla: please continue to improve the efforts of transforming from an electric car manufacturer to an Artificial Intelligence deep application development company, an energy storage company, a self-driving FSD and RoboTaxis (robot taxis) software company, an Optimus (prime) humanoid robot company. The future is promising, greater glory lies ahead. In this land of freedom, the homeland of warriors: do you see if the flag of shining stars is still fluttering; the flag of shining stars, may it wave long. In God We Trust. We believe in God, this statement will be remembered forever.
The Skyscraper, a monumental achievement of Tesla’s technology, will be extended upwards. This is where Elon Musk, leading Tesla, vows to change the world, and where the bulls believe the world will be changed. The most distinctive feature of the USA is the continuous significant progress in basic scientific theory research and applied technological development, with over 400 Nobel laureates, reaching 417, surpassing many countries with just a slight lead of 17.
Investors who are keen on stability and unwilling to take on huge risks in investment trading should choose to buy on dips and build positions in Nvidia, as it is supported by sustained and stable performance. Nvidia is a very important technological node in the AI industry chain.
To make a significant impact in the financial markets, one must invest rather than blindly speculate, and investing requires three key points:
1. From a macro perspective, your chips are cheap enough.
2. You have a sufficient quantity of low-priced chips.
3. Your holding period is long enough to overcome all obstacles, although it may be tough, but you fully enjoy all the major uptrends. The misconception of re-entering the market after stabilization has blocked the path to success for most people. Plan systematically, in gradients and batches, deal with discrete random variables, and strategically position your investments.
In the end, Tesla will definitely surpass Nvidia.
Tesla's conference did not meet the capital expectations, causing a large drop in the stock price.
• 🚗 Investors are looking forward to entry-level models, Tesla has only released self-driving rental cars and robots.
• 📉 Stock prices have dropped significantly due to a large discrepancy between future vision and actual growth.
• 🤖 Self-driving cars face difficulties in implementation, encountering regulatory and safety issues.
The conference was delayed by a full fifty minutes but lasted only twenty minutes. It seems that the capital market is not satisfied with Musk's ambitious vision; they would rather see an entry-level vehicle that meets current demand.
Although Musk stated that this was Tesla's most important event since the release of the Model 3 in 2017, the highly anticipated event only lasted twenty minutes, which was quite unexpected. The self-driving taxi and humanoid robot showcased by Musk do not provide actual assistance to Tesla's recent performance, nor did they announce the much-anticipated news about the entry-level vehicle.
This stark contrast between the promising future vision and the current weak growth clearly disappoints investors. As a result, Tesla's stock price plunged 9% on Friday, marking the largest drop in the past two months; Tesla has tumbled over 12% year-to-date, with its market cap now dipping below $700 billion.
The press conference lasted only 20 minutes.
Yesterday, at the Warner Bros. Studio in Burbank, Los Angeles, California, Tesla held a themed event called 'We, Robot' at the movie set, officially launching an autonomous rental car CyberCab and an autonomous bus Robovan, while showcasing scenarios where the humanoid robot Optimus takes on more daily tasks.
• 🚗 Investors are looking forward to entry-level models, Tesla has only released self-driving rental cars and robots.
• 📉 Stock prices have dropped significantly due to a large discrepancy between future vision and actual growth.
• 🤖 Self-driving cars face difficulties in implementation, encountering regulatory and safety issues.
The conference was delayed by a full fifty minutes but lasted only twenty minutes. It seems that the capital market is not satisfied with Musk's ambitious vision; they would rather see an entry-level vehicle that meets current demand.
Although Musk stated that this was Tesla's most important event since the release of the Model 3 in 2017, the highly anticipated event only lasted twenty minutes, which was quite unexpected. The self-driving taxi and humanoid robot showcased by Musk do not provide actual assistance to Tesla's recent performance, nor did they announce the much-anticipated news about the entry-level vehicle.
This stark contrast between the promising future vision and the current weak growth clearly disappoints investors. As a result, Tesla's stock price plunged 9% on Friday, marking the largest drop in the past two months; Tesla has tumbled over 12% year-to-date, with its market cap now dipping below $700 billion.
The press conference lasted only 20 minutes.
Yesterday, at the Warner Bros. Studio in Burbank, Los Angeles, California, Tesla held a themed event called 'We, Robot' at the movie set, officially launching an autonomous rental car CyberCab and an autonomous bus Robovan, while showcasing scenarios where the humanoid robot Optimus takes on more daily tasks.
The event was scheduled to start at 7 p.m. California time. However, more than half an hour passed without Musk showing up, until 7:37 p.m., when he mentioned on X that someone on-site had an unexpected emergency and needed urgent care. A former Tesla employee suggested that the delay might be Musk's own doing, as he is not very punctual.
It wasn't until 7:55 p.m. that the host took the stage and announced Musk's imminent arrival. The camera then switched to Musk in a black leather jacket, getting into a silver two-door car and driving directly to the event, igniting the atmosphere with this cool scene. Tesla deliberately chose Warner Bros. Studio to unveil the new vehicles, where the buildings and street scenes look both cool and retro. Recently, Tesla's disguised unmanned vehicles have been preparing and rehearsing extensively on the surrounding roads.
This vehicle named Cybercab integrates the styles of several Tesla models: the upper body of Model 3, the rear of CyberTruck, and the iconic scissor doors of a supercar. Inside the car, there are only two seats and a huge central screen, no steering wheel, brake or accelerator pedals. Additionally, the car has no charging port and will use inductive charging. Musk stated that the Cybercab will go into production in 2026 with an expected price below $0.03 million.
It wasn't until 7:55 p.m. that the host took the stage and announced Musk's imminent arrival. The camera then switched to Musk in a black leather jacket, getting into a silver two-door car and driving directly to the event, igniting the atmosphere with this cool scene. Tesla deliberately chose Warner Bros. Studio to unveil the new vehicles, where the buildings and street scenes look both cool and retro. Recently, Tesla's disguised unmanned vehicles have been preparing and rehearsing extensively on the surrounding roads.
This vehicle named Cybercab integrates the styles of several Tesla models: the upper body of Model 3, the rear of CyberTruck, and the iconic scissor doors of a supercar. Inside the car, there are only two seats and a huge central screen, no steering wheel, brake or accelerator pedals. Additionally, the car has no charging port and will use inductive charging. Musk stated that the Cybercab will go into production in 2026 with an expected price below $0.03 million.
In addition to the anticipated CyberCab, Musk also showcased a square-shaped, spacious Robovan that can accommodate 20 people and can be used as a passenger bus or for freight transport. Musk introduced that the future cost of traveling in unmanned vehicles will decrease to 10-15 cents per mile. Apart from the two autonomous vehicles, Musk also mentioned that Tesla will launch unsupervised FSD (Full Self-Driving) functionality for Model Y and Model 3 in California and Texas next year.
Of course, the most exciting moment of last night's event was undoubtedly when Tesla's humanoid robot Optimus somewhat awkwardly walked onto the stage. Musk stated that Optimus is increasingly capable of handling more daily tasks and once in mass production, the price of the robot may drop to the level of $0.02 million to $0.03 million (for household adoption), calling it 'the most important product ever.'
Of course, the most exciting moment of last night's event was undoubtedly when Tesla's humanoid robot Optimus somewhat awkwardly walked onto the stage. Musk stated that Optimus is increasingly capable of handling more daily tasks and once in mass production, the price of the robot may drop to the level of $0.02 million to $0.03 million (for household adoption), calling it 'the most important product ever.'
Here, the press conference ended just twenty minutes after it started, followed by the live audience queuing to experience the self-driving taxi CyberCab. Many humanoid robots stayed at the press conference venue to interact with the audience, dancing to electronic music, mixing drinks for the audience, and even playing rock-paper-scissors.
The concept of electric vehicles cannot support stock prices.
Why did Tesla's stock price drop significantly today despite such cool press conference? In fact, based on past press conferences, it is normal for Tesla's stock price to decline after the event, mainly because investors had accumulated overly high expectations prior to the conference. The sharp drop in stock price this time is for the same reason.
After a significant cooling of the electric vehicle market in the past year and Tesla's notably weak growth, Musk and Tesla urgently need to create the two future new concepts of 'autonomous driving' and 'robots' to continue supporting Tesla's stock price with a PE ratio of over 60 and a market cap of over 700 billion USD, far exceeding other automotive companies by several folds.
Tesla's stock price surged before due to the electric vehicle concept. From 2019 to 2021, Tesla's stock price soared more than ten times, with a market cap exceeding one trillion USD, becoming the leading global auto stock and Musk ascending to the position of the world's richest person. This is mainly because the market is bullish on the future electrification trend of the automotive industry, and Tesla has an unshakable first-mover advantage in the electric vehicle sector.
However, starting from early 2022, with a significant downturn in the US stock market, Tesla's stock price also began to plummet. Despite remaining the top global auto stock, Tesla's market cap has dropped from a peak of 1.3 trillion USD to the current level of 700 billion USD. Musk also briefly lost his position as the world's richest person.
The main reasons why Tesla's stock price has dropped significantly, apart from Musk's personal distractions and deep involvement in political controversies, are the cooling of the electric vehicle market, with Tesla facing increasing competition pressures, significant growth slowdown, and even declines.
Early this year, Musk publicly admitted that Tesla may face a significant slowdown in the coming year. He no longer mentions the ambitious goal of 50% annual growth as before. The reality is even harsher than he imagined. In the first two quarters of this year, Tesla's global deliveries declined for the first time consecutively, although there was a 6.4% year-on-year growth in the third quarter, it still fell short of market expectations.
In china, the world's largest electric vehicle market, tesla faces fierce competition from chinese auto manufacturers, with its market share gradually falling to 6.2% as of august this year (data from the china passenger car association). In the usa and europe markets, tesla also faces unfavorable factors due to the overall cooling of the electric car market, especially in the usa weak charging infrastructure and high electric vehicle prices, directly impacting consumer purchase intentions.
Elon Musk's strong political stance also affects tesla's main consumer cohort. In the third quarter of this year, tesla's sales in the usa dropped by 3.2%, reaching only 0.15 million vehicles. Year-to-date, tesla has sold 0.468 million vehicles, a decrease of 4.6% compared to the same period last year; unless unexpectedly, tesla may experience negative growth in the usa this year. In california, the largest market in the usa, tesla's delivery volume plummeted by 24% in the second quarter of this year.
Far water does not quench near thirst.
The lack of new car models is an important reason for the slowing sales of tesla. Although the Model Y and Model 3 are still the best-selling electric car models globally, they have been released for over five years. Tesla has yet to release a follow-up entry-level model for the household market. Therefore, investors are eager to see tesla introduce its planned $20,000 entry-level model, the Model 2, to bring new sales growth momentum to tesla as its growth slows down.
In early april of this year, Reuters exclusively reported that tesla had abandoned the entry-level model. This news caused tesla's stock price to plummet by over 6%. Musk angrily refuted this as fake news and then announced that tesla would showcase a self-driving car on august 8th (later postponed to october 10th), which helped drive the stock price back up.
Against the backdrop of significantly slowing growth in electric vehicles, autonomous driving and robots are the two main concepts that Musk has been emphasizing this year. Since Musk announced in april that tesla would release a self-driving taxi, tesla's stock price has started to rise again, accumulating a 40% increase. Musk has once again become the world's richest person. Clearly, tesla's current stock price already includes external expectations for tesla's future growth in self-driving cars and robots.
But in addition to self-driving cars and robots, investors are still keen to see Musk announce more practical products, especially news about entry-level models. Because Cybercabs and robots unveiled by tesla yesterday will take several years or even longer to possibly hit the market for delivery, they will not help tesla's current actual performance. Tesla's investors are hopeful that Musk continues according to plan to release a new entry-level model next year. However, at this recent release event, he did not disclose any related information, leaving the capital markets disappointed. CFRA analyst Garrett Nelson stated, 'tesla's recent product roadmap lacks detail, which is disappointing.'
In july of this year, Musk also stated that they will continue as planned to release a new entry-level model next year. However, he did not reveal any related information at this recent event, which has left the capital markets feeling disappointed. CFRA analyst Garrett Nelson said, 'tesla's recent product roadmap lacks details, which is disappointing.'
Tesla and Musk have a long tradition of 'issuing futures', with new products at press conferences often taking several years and multiple delays before actually hitting the market, especially for brand new models. The attractive prices promised by Musk also require years of mass production to achieve. The Semi electric truck was announced in October 2017, but production and delivery did not happen until the end of 2022. The CyberTruck was unveiled in April 2020, but production and delivery are expected by the end of 2023.
Self-driving rental cars may also face delays. While Musk claimed at a press conference that Cybercab production would begin in 2026 at a price not exceeding 0.03 million USD, well-known tech analyst Mingxi Guo from TF Securities indicated that Tesla's autonomous taxis are unlikely to be produced until at least the first quarter of 2027 based on supply chain information assessment. This delay may not provide the much-awaited boost to Tesla's stock price.
Difficulties abound in the implementation of self-driving technology.
Even Musk's demonstration of the two cool self-driving rental cars yesterday did not meet the expectations of the capital markets. Musk merely gave a brief introduction, stating that production of these cars would start in 2026, without providing more details sought by the capital markets: technical specifications, safety assurances, business models, and regulatory requirements.
Automotive website Edmuds analyst Jessica Caldell stated, 'The leap from the present to fully autonomous (especially fully driverless vehicles without pedals or steering wheels) is so vast that we believe Tesla's goal of achieving this by 2026 is overly ambitious.'
This marks Musk's Nth commitment to achieving full self-driving capabilities. Over the past decade, he has continuously portrayed a vision of a future with fully autonomous driving on many occasions, with each given timeframe being two years. As early as the end of 2015, Musk claimed Tesla was just two years away from fully autonomous driving, pending regulatory approval.
A decade has passed, and Tesla has successively released two generations of Autopilot and FSD products. However, these are advanced driver assistance systems (ADAS) in the autonomous driving field, categorized as L2+ level, requiring driver attention and readiness to take over, with a significant gap from the fully autonomous L4 level.
Even so, Tesla's Autopilot and FSD systems are facing numerous investigations and lawsuits. On the first day of FSD official release in November last year, a Tesla abruptly braked in FSD mode on the San Francisco Bay Bridge, causing an eight-car pile-up, fortunately at low speeds with no casualties. This incident is currently under investigation by the NHTSA. In addition, Musk and Tesla are facing lawsuits in California for alleged over-promotion of autonomous driving technology.
More importantly, Musk did not mention the regulatory barriers and safety levels of the self-driving taxi business in the press conference, which also concerns the capital markets. Musk has been describing the bright future of Tesla FSD since 2019, saying that in the future, cars can autonomously pick up passengers and make money for the owners. However, how Cybercab will operate in the future, whether Tesla will build its own fleet or sell to consumers to pick up passengers, these key operational mode information that the capital market wants to know, Musk did not disclose.
Although Musk has always claimed that autonomous driving technology is safer than human drivers, most of Tesla's current traffic accidents are mainly the responsibility of the car owners. Once we truly enter the fully autonomous stage like Cybercab without pedals and steering wheels, Tesla will be solely responsible for all accidents. If any accident occurs unexpectedly, Tesla's self-driving taxi business may suffer a major blow.
Currently, the two leading companies in the self-driving taxi industry are Waymo under Google and Cruise under General Motors. Both companies have been operating in many major U.S. cities for years and obtained official operational licenses from the California government last year. However, one accident can ruin years of Cruise's operating efforts.
In October last year, a major accident involving Cruise's taxi occurred in San Francisco. Despite a pedestrian accidentally falling under the front wheel of the car, the taxi continued to drag the pedestrian for tens of meters before coming to a stop, causing serious injuries to the pedestrian. After the accident, Cruise's taxi license was suspended by California, forcing a shutdown for rectification and safety checks on all its autonomous vehicles. Subsequently, General Motors also restructured Cruise's top management and underwent significant layoffs. In just three months, Cruise's valuation has been halved.
The capital market still wants an entry-level car.
The most crucial reason for Tesla's sharp stock price decline today is that Cybercab does not appear to be the entry-level model that the capital markets want to see from Tesla. Ross Gerber, CEO of Tesla's major shareholder, Gerber Kawasaki Fund, expressed his excitement about self-driving taxis like Cybercab and Robocan, but he would rather see Tesla release a more traditional and affordable entry-level electric vehicle model that can be launched in the near future.
Musk's vision is promising, but it needs someone to implement it. In the next 24 months, Tesla will still be selling electric cars, so why not focus on the electric vehicle business?
The concept of electric vehicles cannot support stock prices.
Why did Tesla's stock price drop significantly today despite such cool press conference? In fact, based on past press conferences, it is normal for Tesla's stock price to decline after the event, mainly because investors had accumulated overly high expectations prior to the conference. The sharp drop in stock price this time is for the same reason.
After a significant cooling of the electric vehicle market in the past year and Tesla's notably weak growth, Musk and Tesla urgently need to create the two future new concepts of 'autonomous driving' and 'robots' to continue supporting Tesla's stock price with a PE ratio of over 60 and a market cap of over 700 billion USD, far exceeding other automotive companies by several folds.
Tesla's stock price surged before due to the electric vehicle concept. From 2019 to 2021, Tesla's stock price soared more than ten times, with a market cap exceeding one trillion USD, becoming the leading global auto stock and Musk ascending to the position of the world's richest person. This is mainly because the market is bullish on the future electrification trend of the automotive industry, and Tesla has an unshakable first-mover advantage in the electric vehicle sector.
However, starting from early 2022, with a significant downturn in the US stock market, Tesla's stock price also began to plummet. Despite remaining the top global auto stock, Tesla's market cap has dropped from a peak of 1.3 trillion USD to the current level of 700 billion USD. Musk also briefly lost his position as the world's richest person.
The main reasons why Tesla's stock price has dropped significantly, apart from Musk's personal distractions and deep involvement in political controversies, are the cooling of the electric vehicle market, with Tesla facing increasing competition pressures, significant growth slowdown, and even declines.
Early this year, Musk publicly admitted that Tesla may face a significant slowdown in the coming year. He no longer mentions the ambitious goal of 50% annual growth as before. The reality is even harsher than he imagined. In the first two quarters of this year, Tesla's global deliveries declined for the first time consecutively, although there was a 6.4% year-on-year growth in the third quarter, it still fell short of market expectations.
In china, the world's largest electric vehicle market, tesla faces fierce competition from chinese auto manufacturers, with its market share gradually falling to 6.2% as of august this year (data from the china passenger car association). In the usa and europe markets, tesla also faces unfavorable factors due to the overall cooling of the electric car market, especially in the usa weak charging infrastructure and high electric vehicle prices, directly impacting consumer purchase intentions.
Elon Musk's strong political stance also affects tesla's main consumer cohort. In the third quarter of this year, tesla's sales in the usa dropped by 3.2%, reaching only 0.15 million vehicles. Year-to-date, tesla has sold 0.468 million vehicles, a decrease of 4.6% compared to the same period last year; unless unexpectedly, tesla may experience negative growth in the usa this year. In california, the largest market in the usa, tesla's delivery volume plummeted by 24% in the second quarter of this year.
Far water does not quench near thirst.
The lack of new car models is an important reason for the slowing sales of tesla. Although the Model Y and Model 3 are still the best-selling electric car models globally, they have been released for over five years. Tesla has yet to release a follow-up entry-level model for the household market. Therefore, investors are eager to see tesla introduce its planned $20,000 entry-level model, the Model 2, to bring new sales growth momentum to tesla as its growth slows down.
In early april of this year, Reuters exclusively reported that tesla had abandoned the entry-level model. This news caused tesla's stock price to plummet by over 6%. Musk angrily refuted this as fake news and then announced that tesla would showcase a self-driving car on august 8th (later postponed to october 10th), which helped drive the stock price back up.
Against the backdrop of significantly slowing growth in electric vehicles, autonomous driving and robots are the two main concepts that Musk has been emphasizing this year. Since Musk announced in april that tesla would release a self-driving taxi, tesla's stock price has started to rise again, accumulating a 40% increase. Musk has once again become the world's richest person. Clearly, tesla's current stock price already includes external expectations for tesla's future growth in self-driving cars and robots.
But in addition to self-driving cars and robots, investors are still keen to see Musk announce more practical products, especially news about entry-level models. Because Cybercabs and robots unveiled by tesla yesterday will take several years or even longer to possibly hit the market for delivery, they will not help tesla's current actual performance. Tesla's investors are hopeful that Musk continues according to plan to release a new entry-level model next year. However, at this recent release event, he did not disclose any related information, leaving the capital markets disappointed. CFRA analyst Garrett Nelson stated, 'tesla's recent product roadmap lacks detail, which is disappointing.'
In july of this year, Musk also stated that they will continue as planned to release a new entry-level model next year. However, he did not reveal any related information at this recent event, which has left the capital markets feeling disappointed. CFRA analyst Garrett Nelson said, 'tesla's recent product roadmap lacks details, which is disappointing.'
Tesla and Musk have a long tradition of 'issuing futures', with new products at press conferences often taking several years and multiple delays before actually hitting the market, especially for brand new models. The attractive prices promised by Musk also require years of mass production to achieve. The Semi electric truck was announced in October 2017, but production and delivery did not happen until the end of 2022. The CyberTruck was unveiled in April 2020, but production and delivery are expected by the end of 2023.
Self-driving rental cars may also face delays. While Musk claimed at a press conference that Cybercab production would begin in 2026 at a price not exceeding 0.03 million USD, well-known tech analyst Mingxi Guo from TF Securities indicated that Tesla's autonomous taxis are unlikely to be produced until at least the first quarter of 2027 based on supply chain information assessment. This delay may not provide the much-awaited boost to Tesla's stock price.
Difficulties abound in the implementation of self-driving technology.
Even Musk's demonstration of the two cool self-driving rental cars yesterday did not meet the expectations of the capital markets. Musk merely gave a brief introduction, stating that production of these cars would start in 2026, without providing more details sought by the capital markets: technical specifications, safety assurances, business models, and regulatory requirements.
Automotive website Edmuds analyst Jessica Caldell stated, 'The leap from the present to fully autonomous (especially fully driverless vehicles without pedals or steering wheels) is so vast that we believe Tesla's goal of achieving this by 2026 is overly ambitious.'
This marks Musk's Nth commitment to achieving full self-driving capabilities. Over the past decade, he has continuously portrayed a vision of a future with fully autonomous driving on many occasions, with each given timeframe being two years. As early as the end of 2015, Musk claimed Tesla was just two years away from fully autonomous driving, pending regulatory approval.
A decade has passed, and Tesla has successively released two generations of Autopilot and FSD products. However, these are advanced driver assistance systems (ADAS) in the autonomous driving field, categorized as L2+ level, requiring driver attention and readiness to take over, with a significant gap from the fully autonomous L4 level.
Even so, Tesla's Autopilot and FSD systems are facing numerous investigations and lawsuits. On the first day of FSD official release in November last year, a Tesla abruptly braked in FSD mode on the San Francisco Bay Bridge, causing an eight-car pile-up, fortunately at low speeds with no casualties. This incident is currently under investigation by the NHTSA. In addition, Musk and Tesla are facing lawsuits in California for alleged over-promotion of autonomous driving technology.
More importantly, Musk did not mention the regulatory barriers and safety levels of the self-driving taxi business in the press conference, which also concerns the capital markets. Musk has been describing the bright future of Tesla FSD since 2019, saying that in the future, cars can autonomously pick up passengers and make money for the owners. However, how Cybercab will operate in the future, whether Tesla will build its own fleet or sell to consumers to pick up passengers, these key operational mode information that the capital market wants to know, Musk did not disclose.
Although Musk has always claimed that autonomous driving technology is safer than human drivers, most of Tesla's current traffic accidents are mainly the responsibility of the car owners. Once we truly enter the fully autonomous stage like Cybercab without pedals and steering wheels, Tesla will be solely responsible for all accidents. If any accident occurs unexpectedly, Tesla's self-driving taxi business may suffer a major blow.
Currently, the two leading companies in the self-driving taxi industry are Waymo under Google and Cruise under General Motors. Both companies have been operating in many major U.S. cities for years and obtained official operational licenses from the California government last year. However, one accident can ruin years of Cruise's operating efforts.
In October last year, a major accident involving Cruise's taxi occurred in San Francisco. Despite a pedestrian accidentally falling under the front wheel of the car, the taxi continued to drag the pedestrian for tens of meters before coming to a stop, causing serious injuries to the pedestrian. After the accident, Cruise's taxi license was suspended by California, forcing a shutdown for rectification and safety checks on all its autonomous vehicles. Subsequently, General Motors also restructured Cruise's top management and underwent significant layoffs. In just three months, Cruise's valuation has been halved.
The capital market still wants an entry-level car.
The most crucial reason for Tesla's sharp stock price decline today is that Cybercab does not appear to be the entry-level model that the capital markets want to see from Tesla. Ross Gerber, CEO of Tesla's major shareholder, Gerber Kawasaki Fund, expressed his excitement about self-driving taxis like Cybercab and Robocan, but he would rather see Tesla release a more traditional and affordable entry-level electric vehicle model that can be launched in the near future.
Musk's vision is promising, but it needs someone to implement it. In the next 24 months, Tesla will still be selling electric cars, so why not focus on the electric vehicle business?
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