This is an opinion piece - there’s no factual basis (nor any facts quoted) to support this narrative at all. Plus, key things missing from the calculus include:<p>- COVID, that put a strain on manufacturing during lockdowns and the eventual worldwide supply chain disruptions<p>- the new administration and its anti EV stance<p>- emergence of AI<p>- betting the future of Tesla on Optimus (product) and Robotaxi (service)<p>How much could JB Staubel have influenced Tesla during these times is anybody’s guess.
Isn't Tesla trying to be SpaceX's vertically integrated robotics division? My gut feeling says they are trying to move out of the EV business as crazy as that may seem to us normals.
Being in the EV business means having to accept predictable revenues that then tie to more predictable stock prices. Being in the business of "some future technology" doesn't.
The big problem for Tesla is that they cannot sustain their valuation from the car manufacturing business. There's a perpetual need to justify why Tesla should be valued an order of magnitude more than other automakers. Selling the dream of future profit is Tesla's main business.<p>(For the record Tesla makes roughly 10% of Toyota's profits and has almost 3 times the valuation, no Tesla shareholder is ready for a 97% share price drop so Tesla has to keep the dream machine at full steam).<p>Edit: Tesla is 3 times Toyota in valuation, not 5 as I said earlier, not that it changes the argument much.
You can laugh at it, and most likely it will crash and burn.<p>But at the same time, maybe they are doing the correct analysis.<p>"If we stay here and grow fat the others will eat us. To infinity and beyond!".<p>100 years ago your business was your warehouse or your locomotive. These days, maybe your business is defined by your rate of change?
Tesla and Space-X.
They are a battery company. The cars are just a way to sell batteries.
Very expensive batteries compared to the competition
The comparison is actually even worse if you compare it to other companies on the battery sector. How is Tesla supposed to be five times more than CATL ffs?
The cars are actually a way to drive yourself around town. Yes they also contain batteries.
SpaceX and Tesla are just another form of the Star Citizen phenomenon.
That's an awesome analogy, I'm stealing it right away.
"Irrational exuberance" is, I believe, the most concise description.
Being in the EV business means having to compete with China. This market is dictated by manufacturing costs and so it is not where you want to be.
It's sort of Tesla's core thesis that want to to attain the world's lowest manufacturing costs, by doing novel things with robotics and AI that automate away humans.<p>Everyone gets this backwards. Tesla isn't <i>abandoning</i> their low-margin auto manufacturing in order to switch to high-margin robotics tech; they want to capture the margin of robotics for themselves first. If their manufacturing half fails, that means their robotics half also failed at its primary task.
Chinese cars are effectively excluded from the US market mainly to keep Tesla afloat.
no, they mostly not allowed to keep fords, gm, and other inefficient manufacturing afloat.<p>Proofs? tesla exists in China and cable to compete there. There is no ford or GM in it's US shape, only sub brands that loosing ground.
Which begs a question: Is it really possible to compete with China on consumer products? The price and cost of labor advantage, indeed state sponsorship and support, would suggest that it's not.
For electronics, sure. iPhone and Android are American products. Playstation and Switch are Japanese. If you mean "can we compete on cost of manufacturing," no. They all build in China.
Veblen goods can compete. China is unique in cheap high tech products. As production scales down and shipping costs go smaller markets open.
Musk's companies are some with the most state sponsorship on the planet. Remove the tax credits, government buying, and commercial barriers, and there's nothing.<p>Even then, he is losing to Chinese competition. It's pure incompetence.
That seems like a major issue national security wise. I wonder why no one has brought that up?
Musk basically lost to China competitition, but can't assume it.
Well fsd and robotaxi are still mere futuristic concepts and semi vaporware but I get it, that doesn't sell shares anymore
Not crazy at all. Tesla gave up being a car company a few years ago, but there's lot of inertia and the 3 and Y are still competitive products in the marketplace.
Why would Tesla pivoting seem strange? They've lost the global EV race, they've sabotaged their American market and they haven't done anything but weak publicity stunts in years. Their profits are tanking, their brand is toxic and their prospects are dim. That doesn't scream 'bright future' to me.
That roadster demo proved to me they are not serious about making EVs anymore. Strapping rockets to a car makes an interesting spectacle, but is utterly impractical for a real consumer vehicle.
Truth. However it's pretty great marketing, fairly certain every car enthusiast on the planet has seen that demonstration. Eyeballs that likely can't be bought otherwise. The flying version will never be made for a human occupant, but if they do make a few they will be collectors items.
To be fair, I did not believe for a moment that this was a serious idea. Instead it looks a stunt to be performed, not a serous consumer feature. Surely? Such a feature would never pass FMVSS muster.
It’s especially crazy since they sell cars and do not sell robots. Both of Musk’s public companies are little more than financial fraud. That the SEC allows any of this gives me zero confidence in the entire market.
> That the SEC allows any of this gives me zero confidence in the entire market.<p>It will be truly nasty for the next President. All of this shit is going to blow up <i>hard</i>, even worse than 2007 was. With any luck, it will blow up during Trump's final months, but in the truly worst case it will collapse during the early time of whoever the next President is, which means no matter who gets the job will get <i>smoked</i> in the 2030 midterms - in turn ending up like Obama who didn't have a majority of his own for six years (or, in the even worse case, end up like Biden who didn't survive the reelection against someone as unlikeable as <i>Trump</i>).
Obama didn't do much with his two years of majority anyway.<p>Plus, president's don't usually have more than two years of majority.
The Affordable Care Act is the biggest non tax cut legislation of the previous 30 years.
And to add to this, for also properly dealing with the 2008 financial crisis. Just as a reminder to those out there, the strategy of recent administrations for crises like this was to cut federal spending in order reduce deficits, and many of the politicians at the time were calling for cutting spending. Obama listened to his economic advisors who told him to stimulate the economy and get money into the hands of the people. There were some rough edges to their stimulus spending but it seems to have worked and our recovery was the envy of most of the world. In recessions, stimulus seems to have now become the norm.
I would argue that the Affordable Care Act was nothing more then a common sense consumer protection legislation for a consumer market that should not exist in the first place.<p>The fact that it was this big and this hard to get and with this many compromises against consumer interest, speaks more of the disfunction of the USA government at the time then it does about the value of that legislation.
You mean other than Obamacare, Dodd Frank, GFC stimulus, Auto industry support, repeal of DADT?<p>Yeah, you're right. Much better to have Trump who just passed tax cuts for billionaires and corporations, imposed tariffs on Penguins and pardoned a bunch of people, some of whom he said he didn't even know.
Don't worry, American tax payers will come to rescue the companies.
The cynic in me would say, "all according to plan", it will be right before the new house and senate are going to roll out universal healthcare or something equally good for the average person. Better to get head of it before that happens.
Hyundai has been making robots for decades. Imagine the hype if Tesla did half the things Hyundai is doing.
They <i>have</i> to move out of the EV business. Their shareholders have eyed up the big potential returns from optimus/cybercab/next-moonshot and valued the company sky high as a result.<p>When you have a sky high valuation, spending capital on something that just gives steady returns is a net negative for everyone. You <i>have</i> to put all the capital into the moonshots.
Pretending Tesla isn't a car company and SpaceX isn't a satellite services company (Internet, maybe mobile) is wild stuff. The only real profits are from those traditional industries. All the sci-fi hype is for investors and fanatics.
FYI, Tesla makes a large fraction of its profits off the margins from selling grid-scale ("Megapack") batteries to utilities; renewable energy projects (buffering energy generated by e.g. private wind farms); and most recently, data centers (where they act either as giant battery-backed UPS systems, or as reservoirs between on-site power generation and fluctuating on-site demand.)<p>They probably have also been <i>trying</i> to penetrate the military energy storage market (a.k.a. "tactical microgrids"), but so far they haven't. They need more vertical integration for that. Right now they don't own battery-cell manufacturing, so the defense contractors that build ruggedized battery packs skip them and go straight to sourcing from the battery-cell manufacturers.<p>(Fun fact: Tesla's Gigafactories <i>as physical spaces</i> produce a ton of battery cells, but <i>Tesla itself</i> doesn't. Tesla leases space in its Gigafactories to cell manufacturers like Panasonic, who actually produce the cells, so that Tesla can then directly consume some of the cells produced into battery packs, without any intervening logistics costs.)<p>It's always been my own personal stance that Tesla is a battery company, that happens to sell some of its battery packs in the form of cars. (Remember that 80% of the depreciated value of an EV is its batteries.) The cars were never the core of Tesla's business model; they were a useful vertically-integrated B2C demand-sink they used to bootstrap their B2B battery sales business.
Those are just side projects. SpaceX is now an AI company. All their phony future revenue projections are dependent on magic numbers cooked up by a drug addict who convinces people to believe his stream of lies.
Value the company by the sizzle not the steak. And before it fails completely fold it into the next grift. Sounds far fetched but it's been working for Elon for years.
The problem I see is with focus. Elon/Tesla seems to go after the next big thing every couple of years without a real plan.<p>I'm surprised that the markets have given Elon the amount of slack he's gotten. Once you merge Tesla into SpaceX, what's the plan? Tesla can't seem to roll out new vehicles with different body styling. Is robotics or AI the next big thing? What will happen to their car business? Will it just be CyberCabs? Will they become a mobile phone carrier?<p>The list of questions goes on and on. All this feels like a YC company looking for a new line of business because they just figured out their current line of business isn't all that great.
I think it’s pretty obvious: sell the machines that replace humans as AI improves, and be ready to run that AI at massive scale.<p>First off is robotaxis and semis (99% of highway driving and 80-90% of city driving driver jobs have been very effectively replaced right now by machine, look at Waymo if you don’t believe Elon), and then Optimus for stuff that needs hands, like warehouse workers or other low-skill “move heavy things from here to there” jobs.<p>My six year old Tesla 3 just drove me from Vegas to LA, door to door, without me having to give it any control inputs. Not a lot of people seem to be paying attention to how good it is now.<p>I imagine Optimus will be a really big deal once they get it working as well as Teslas drive.
> First off is robotaxis and semis (99% of highway driving and 80-90% of city driving driver jobs have been very effectively replaced right now by machine, look at Waymo if you don’t believe Elon)<p>Waymo hasn’t achieved that, though, right? They’re deployed in minimal markets, and I would be surprised if they had even replaced a majority of taxi rides where they are deployed.<p>Your trip still requires you to be at the wheel and conscious because the technology can’t be guaranteed to not try to murder you. How many miles do you go between driving accidents? Really asking: how many miles do you go between intervening with self driving?<p>The lack of complete market takeover is a sign the technology just isn’t there yet.
Neuralink brain uploads! Preorder now for immortality!
The line of business is fine. Tesla & SpaceX both make things people want. Neither cars nor rockets are being disrupted by AI. They could achieve good-to-great growth under stable, full-time, drug-free management. But if you feel you need a large amount of capital <i>and</i> you want to retain control of SpaceX and Tesla, bolting these startups onto them is a way to double down. It's just a shame to see those existing things get torched.
It's not "crazy," it's flim flam. It's what Elizabeth Holmes would've look like had she bought a health tech firm before starting the Thernos scam so she could pump her stock to a P/E ratio over 300 instead of scamming naïve noob tech investors.
is this something that's actually happening, or just something elon told investors at his optimus event with the obviously fake robots a couple years ago?
It's not crazy at all. Elon, in all his genius, built up an EV company and then alienated the core demographic for his product. They tried to salvage it with a wildly over-priced, virtue-signaling "truck" and that didn't work. There are literally millions and millions of Americans who would have other wise loved to buy a Tesla but will never buy one because of Elon. They have to pivot.
Musk's companies are good at entering a stagnated industry and proving that it can work better if radically changed. But once the new concept is proved, they seem kinda spent, a pivot makes sense to me.<p>It'll be interesting to see if they can do well in places where there aren't a bunch of stagnant incumbents to upset. I'm sure Musk would love to edgelord his way through a conversation where he offends a bunch of people by implying that they have been doing asteroid mining all wrong, those idiots, and then go prove himself right, but there's just nobody doing that.
> My gut feeling says they are trying to move out of the EV business as crazy as that may seem to us normals.<p>It's not that crazy. The last new release of a truly mainstream car was the Model 3 <i>a decade ago</i>. Anything ever since has been facelifts and the ill-fated Cybercuck.<p>The major problem Tesla faces is that on the one side their brand image is in the gutters and has been for years and on the other side, "established" car companies finally have brought competitive cars to the market at relevant scale. They'll need to invest <i>a lot</i> of money to develop a new model from scratch with a high chance of not making back the money.
> The last new release of a truly mainstream car was the Model 3 a decade ago.<p>I'm no Tesla fan, but having longevity in car models is a good thing. My fun car was built by VW in Germany for a decade and then by VW in South Africa for another decade; parts availability is great.<p>In today's marketplace of very samey cars, models that work should probably last a decade or more.<p>That said, Tesla could have built out a couple more styles, such as maybe a minivan/workvan/delivery van, although van sales can be pretty cyclical, and Tesla parts and service was (is?) notoriously poor in some cases, so I dunno if commercial users would be interested.
Not to mention that internationally they are competing with Chinese EVs which are very compelling alternatives.
$100 per month in a $40k vehicle that allows it to drive sufficiently well 99% of the time such that it reduces driver stress and liability is worth something.<p>Other car manufacturers somehow can’t even provide dashcam recordings in a $40 vehicle.
There's too many confounders to say that JB Straubel is the cause.<p>Examples: Covid controversies around musk in 2020, Twitter acquisition in 2022, Musk becoming the world richest person in 2021
look at the source. i think they hate elon so i discount their opinion.
The Cybertruck grossly misunderstood the target audience.<p>Look at the Maverick sales, when it was 20k. Slate Auto seems to have gotten it right.
Cybercab seems to have had a very promising start, metrics are good. This seems far more of a political hate piece than one based on any data.
Isn't it completely overshadowed by Waymo? From what I've heard Waymo is more profitable and has substantially fewer accidents due to better technology.
From the outside in this is how I see it (being in Austin which seems to be ground zero for a lot of the testing):<p>Waymo is betting that cutting zero corners and being rigorous will pay off down the line. They seem best in class.<p>Zoox seems to be betting that reducing time to get passengers in and out while providing a novel platform will be a differentiator. More sensors than Tesla but fewer cars than both the others.<p>Cybercab seems to be about cutting cost (and corners) wherever they thing they can get away from it and betting cheap will win the day (sort of like a discount airline). This assumes they're not doing something O(N) expensive behind the scenes, like having every ride monitored by a human operator in another country.<p>I remember some company dragging a person for awhile and the car not realizing. I'm worried tesla will find itself in a situation like that (or another edge case). I feel safer being around a Waymo as a pedestrian than a cybercab. I even had a Waymo stop for me at a pedestrian crossing when I was waiting for it to go by (I wasn't trying to cross).<p>In the long run Waymo will have to figure out how to have a cheaper platform and Tesla will have to toe the cheap/good-enough line. Zoox is still seemingly unlaunched so IDK about them. Time will tell.
Tesla has had a massive surge in cybercabs in Austin over the last few weeks. I would venture to say they have surpassed the number of Waymos over here. Don't have any numbers to back this up though. As for being profitable, it seems the cost of a cybercab should be much less than a Waymo.
It may be the other way around if the pace in Austin is repeated elsewhere. Cybercab rides per week has already surpassed, Waymo, allegedly.<p><a href="https://x.com/KHerriage/status/2114902145627504719" rel="nofollow">https://x.com/KHerriage/status/2114902145627504719</a>
Did you take a look at amount of money waymo is losing let alone profit?<p>Unsupervised robotaxi has lower (at fault) accidents than unsupervised waymo.<p>All notable cybercab accidents have been done by remote driving.<p>The only thing waymo have are
- large fleet thus large miles/week
- many cities<p>In last week or so, Tesla went from tiny to equal/more than waymo in Austin seemingly in just a few days.<p>They'll do that in other cities too in due time.
> <i>Unsupervised robotaxi has lower (at fault) accidents than unsupervised waymo.</i><p>Waymos exist and have for years. Whatever fabricated data Musk came up with here has no relation to reality.
Do either of them have _any_ at fault accidents?
There always gonna be both Pepsi and Cola.
Tesla's taxi business isn't real. Waymo has been transparent about how their cars handle situations that require human intervention. Waymo's most important technology isn't superior sensors, it's the ability to be truly autonomous without continuous oversight, even when putting a human in the loop to make a decision. Humans never drive a Waymo remotely, because that's dangerous and stupid. Tesla won't say how their remote intervention works, but it's probably a sketchy as a Chinese Robo taxi but without the Chinese 5G network that actually is low latency.
You mean Coca-Cola. Pepsi Cola is a Cola from Pepsi.
Except I can go to the store and buy a Coke and a Pepsi. Musk’s vaporware doesn’t actually exist in the market.
Meh, not a Muskboi but it's public now, no invite needed.<p><a href="https://www.youtube.com/watch?v=T1Id2aas5wI" rel="nofollow">https://www.youtube.com/watch?v=T1Id2aas5wI</a> (you can find more using Youtube search or Chat)<p>Is it global, or US wide? Nope, Waymo isn't neither.
Waymo isn't profitable at all. It's a massive money loser. And in some cities Tesla is nearly at parity
If a few things work out for Tesla they can do overshadow Waymo very quickly.<p>Waymo’s entire fleet is estimated at about 6000 cars.
Tesla produces this many cars in a little over a day.<p>The cybercab is also likely to end up costing 1/10th of a Waymo car<p>It’s not that Tesla is winning here. But the economics of their solution can totally tilt the entire market in the future.
> If a few things work out for Tesla they can do overshadow Waymo very quickly.<p>If.<p>I've been reading the same thing each year since basically the first version of Tesla's car AI. I'm sure I've even <i>written</i> similar things.
Waymo's total is probably 5000 or fewer. But they operate 24/7. They are providing half a million commercial rides a week.<p>Tesla hasn't got the scale or operating consistency to even truly call itself a commercial service. Elon keeps claiming the Tesla will overwhelm everybody in the whole fleet will wake up one day and be a moneymaking taxi machine.<p>No it won't. Here's the reality:: <a href="https://autonomixinvestor.com/robotaxi-tracker/" rel="nofollow">https://autonomixinvestor.com/robotaxi-tracker/</a>
The Cybercab has not had a promising start. Years behind schedule, available nowhere and Musk has negative brand value. Another DOA Tesla scam.
I think Cybercab is cool but I think its continued reliance on cameras is not the best path for this technology.
Lack of lidar isn't the biggest problem. Nor will adding it make Tesla's cabs suddenly reliable and useful. They don't have Google's geospatial data, they don't have the remote intervention infrastructure, they haven't expanded it across multiple cities and built out the service infrastructure to clean and repair their fleet. They don't have the financial history to go to Pimco for term loans paid out of cash flow.
There are millions of Americans like me who will never step foot in one because of their association with Elon Musk.<p>That's an insane negative attribute that Waymo doesn't have to worry about. I hate the Alphabet guys too, but not to the same extent of completely boycotting all their products (yet).
Speaking as someone who follows the NFL, people will forgive all kinds of horrendous behavior if the player's team is winning. It's easy to say things in the abstract like "won't buy a Tesla" because most people aren't really shopping for a car all that often. But if the cybertaxi works and is cheap, then I would guess a lot of people won't be sticking to their proclaimed values. That said, I have my doubts that cybercab will really work all that well.
I was a Cleveland Browns fans for literally my entire life until they signed Deshaun Watson. I watched every single game, but now I haven't watched a game in like four years. I was already concerned about the effects of CTE, but I couldn't go on cheering for a team that knowingly signed a rapist.<p>You should surround yourself with people who are willing to stand up for their convictions.
> There are millions of Americans like me who will never step foot in one because of their association with Elon Musk.<p>You guys have to realize at some point that you're not a significant part of the market. There are a lot of people who don't particularly like musk but the amount that would never use a cybercab isn't a significant part of a 300m person market.
It was very strange, in the beginning people celebrated Tesla, they raved about it, the sales were great, but then as soon as the politics got involved, suddenly it's all turned negative.
"Politics got involved" from the beginning. In the context of USA politics, being an EV company while your CEO talked about how important electrification was to stave off the effects of human caused climate change is 100% a politically coded act.<p>What happened wasn't "politics got involved", what happened was that CEO started talking other politics.<p>And to say that "politics got involved" is a ridiculously passive statement. Elon has full control over how he publicly acts. Politics "didn't get involved" from 2022 onwards, Elon's publicly articulated political views significantly shifted, AND THEN Elon personally led massive organizational changes in the federal government.<p>Regardless of if you support or oppose DOGE, it's completely dishonest to wall off his actions at DOGE into a separate category of acts that you can clearly separate from his business.
This is a business lesson that most competent CEOs are intuitively aware of.
Elon's cognitive decline from drug addiction affected both his business and political decision making. pre-ketamine Elon delivered the Falcon 9, Model 3/Y, and Starlink. post-ketamine Elon gave us Cybertruck, Starship (aka the SpaceX Cybertruck), and a bunch of fake products like the flying roadster, humanoid robots, and Cybercab.
Almost as if journalists were paid partisan hacks.
> Cybercab seems to have had a very promising start, metrics are good. This seems far more of a political hate piece than one based on any data.<p>What? This is just a political hate piece because of the potential of something that just started five minutes ago? You're damning Tesla with faint praise yourself and don't even know it.
Tesla is one china EV tariff away from bankruptcy
If we are to be charitable to Tesla, new car development isn’t like new tech product development. The shortest possible period of time to develop a new car is probably about 4-7 years.<p>I’d also say that the YL is something of a new product and a very successful one, even though it’s more of a long wheelbase variant.<p>Still, I agree with the thesis of the article. Where are the smart decisions?<p>The Cybertruck could have been a home run product for the US market, but Tesla’s own hubris about that market really buried it. They focused on styling and marketed it as a cyberpunk lawless society survival vehicle where angry mobs of cyberpsychos can’t break your window.<p>Hello, Tesla, you needed to put the truck in NFL advertisements and show how it’s going to be amazing for your blue collar cosplay sessions and how it’s going to get 300 miles of range while towing a boat (which it was supposed to but it didn’t).<p>The Cybercab being a two-door coupe is insane. How did that pass the first design discussion? Look at how the Waymo Zeekr cab is designed, look at a how a London cab can fit like 5-6 people in a normal-sized car, look at the Nissan NV200 as NYC’s exclusive taxi from 2012-2018.<p>None of these are two seater low entry coupes.<p>Where is the full size 3-row family vehicle to convince upper middle class suburban moms to not buy an EX-90? Where is the European city car?<p>What is Tesla doing with their time?
MKBHD made a good observation about the Cybercab[1]. The way the doors are designed, you will get high incidents of “collision with an open door of a stationary vehicle” also known as a dooring accident. If it was intended to be a robotaxi, why didn’t they just make the doors swing up in a vertical plane rather than chickenwing out like that. Another impractical vanity door feature just like with the Model X doors. Most likely conjured up by none other than the boss himself, designer of the Cybertruck.<p>1: <a href="https://youtu.be/fo-uubnajWM?t=3m30s" rel="nofollow">https://youtu.be/fo-uubnajWM?t=3m30s</a>
Is this a paid piece behind the scenes by JB Straubel? It reads exactly as someone who was paid or got exclusive access to write something to over highlight someone.
The stock is the product
You make an excellent point. So long as the stock of a company continues to rise, or at best stable, is the only thing that seems to matter. Regardless of customer service, quality, etc. it's the stock price. I think we have seen that enough across other companies to reach some conclusion on the assumption.
Exceptional success is both timing and having an exceptional team. But yea, let's keep attributing it to great man theory, because that's more digestible and people like to mythologize a single person.
Elon had an insane talent of finding the right people with wild moonshot ideas to run his companies while he was getting the credit and the limelight.<p>Then he got older, got into politics and fully bought into the marketing about himself. He thinks he's a genius and that everything he touches turns to gold.<p>Well... Turns out stuff works as long as he is <i>out</i> of the loop and doesn't make any direct decisions.
> Turns out stuff works as long as he is out of the loop and doesn't make any direct decisions<p>This is not unique to Musk - many tech CEOs learn this the hard way when they start meddling in the day-to-day. Bezos built an empire, but the projects he took personal control of (like FirePhone) tended to be unmitigated disasters.
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FSD that actually works and the massively popular in live markets robotaxi service are the obvious answer to “big-deal things that came after this CTO left”<p>$2B cybertruck failure barely registers vs how impactful FSD has been on model Y / 3 sales. Tesla is supply constrained again, with multi-month waits for the model Y L edition
Tesla Model Y is the best selling car in the world for like 3 years in a row. They don't need a new product any time soon.<p>Edit: All you Tesla haters just google "best selling car in the world last 3 years" and you'll see.