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At a high-profile event called ‘We, Robot,’ Tesla CEO Elon Musk presented the long-awaited Cybercab, a fully autonomous robotaxi, and the Robovan, an ambitious new transport vehicle. The event generated excitement among Tesla enthusiasts. However, investor reactions highlighted significant concerns regarding the practicality and feasibility of these future vehicles.
Musk presented the Cybercab, a sleek two-seater electric vehicle designed for the autonomous ride-hailing market. Its design borrows elements from both the Model 3 and the Cybertruck. The doors open upwards, and the minimalist interior is devoid of traditional controls such as the steering wheel or pedals. Instead, the Cybercab features a single large infotainment screen, reinforcing its futuristic character.
Musk touted a price point below $30,000, potentially undercutting even the Model 3, which starts at approximately $42,490. This enticing price, however, raises eyebrows given Musk’s track record of optimistic projections; the Cybertruck’s initial pricing promise has ballooned to over $80,000, creating doubt about the Cybercab’s affordability in practice.
With Musk’s optimism, the market’s reaction was surprisingly muted. Following the announcement, Tesla’s shares dropped about 9%, wiping out approximately $70 billion in market capitalization. Analysts were disappointed by the absence of concrete facts about the Cybercab’s features, operational model, and availability schedule. This left many investors feeling that the event focused more on showmanship than substance.
According to Tom Narayan of the Royal Bank of Canada, investors expected more substantive information to back up Musk’s grandiose predictions.
“Investors we spoke to at the event thought the event was light of real numbers and timelines. The event seemed more focused on branding and marketing the Tesla vision rather than delivering concrete figures and timelines,” he told the Wall Street Journal.
This feeling matches broader investor anxiety about Musk’s tendency to make great statements with little follow-through.
Along with the Cybercab, Musk also presented the Robovan, a fourteen-seat autonomous shuttle designed to change public transportation. The Robovan’s design is futuristic, with hidden wheels and LED accents. It is said to be versatile enough for a variety of applications, including school buses and mobile workshops.
However, similar to the Cybercab, Tesla presented it without key technical details, such as battery capacity, operational specs, and market release dates.
Musk just hinted at how fleets could use the Robovan in a manner similar to ride-hailing services like Uber and Lyft. However, with clarity about Robovan’s operating framework and commercial strategy, it is easier to estimate its potential success.
Musk has heightened expectations for the Robovan and Cybercab because of his continuous claims regarding Full Self-Driving (FSD) technology. During the occasion, he mentioned that future updates would soon make the Model 3 and Model Y fully autonomous in certain states. However, distrust is widespread due to the history of missing deadlines and inflated projections.
Analysts at Morgan Stanley said Musk’s inability to explain the FSD’s development and preparedness for regulatory approval harmed investor confidence in Tesla’s ability to execute its ambitious objective. Since these vehicles are designed to operate fully autonomously, regulators and experts still need to address questions about compliance and real-world performance.
Many industry professionals wondered if Tesla could indeed transform transportation after the Cybercab and Robovan were present and if these cars would have to start over. Critics argue that the Cybercab’s design, which lacks traditional controls, may encounter considerable challenges in obtaining regulatory approval and public acceptance. Furthermore, these vehicles may remain conceptual.
Even Donald Trump, an unlikely critic, expressed alarm about the technology, calling it “a little worrisome” and vowing to do everything in his power to keep such vehicles off American roads.
The feedback from investors and industry analysts makes it clear that a reality check is in order. The Cybercab and Robovan showcase Tesla’s commitment to innovation and sustainability. However, the project still lacks the concrete details and realistic planning necessary for success. Without these elements, these bold ideas may remain flashy concepts, struggling to become genuine contenders in the highly competitive automotive market.
Of course, there have also been some positive opinions, but most experts still need to be convinced. A Model 2, the much-discussed $25,000 budget Tesla, would likely have been more persuasive. However, at this point, the long-awaited affordable model may never see the light of day.