Tesla launched “Cybercab” on October 10, 2024 in Burbank, California.
Electric car maker stocks Tesla The company’s long-awaited robotaxi event — in which CEO Elon Musk unveiled the company’s Cybercab self-driving concept vehicle — failed to impress investors on Friday. The impression caused the company’s stock price to plummet.
Tesla shares were down 5.7% in premarket trading as of 5:20 a.m. ET on Friday.
On Thursday night, Musk revealed Tesla’s Cybercab concept – a low-slung silver two-seater with no steering wheel or pedals. The plan is for the car to drive itself when started.
The Tesla boss said the company hopes to produce the Cybercab by 2027, but did not provide details on where the car would be produced. He said consumers can buy Tesla Cybercab for less than $30,000.
He also said that Tesla is expected to install and run “unsupervised FSD” on Model 3 and Model Y electric vehicles in Texas and California next year. FSD, which stands for Full Self-Driving, is Tesla’s advanced driver assistance system, and a “supervised” version is now available for Tesla electric vehicles.
The technology still requires a human driver to take the wheel, ready to swerve or brake at a moment’s notice.
“Momentum tapering off ahead of event”
In response to Thursday’s events, Barclays analysts said the revelations did not highlight any near-term opportunities for Tesla, but instead prioritized Musk’s vision for a fully autonomous future.
Barclays’ U.S. Auto and Mobility team wrote in a report earlier: “As expected, like Tesla’s previous product launches, this event did not focus too much on the details, but instead emphasized the support for Tesla. The vision of developing efforts in the field of AI/AV (autonomous vehicles).
“However, there were no updates indicating near-term opportunities. Tesla did not show off its low-cost model, which it plans to produce in January 2025,” they added. “We have also not been provided with any recent updates on FSD’s progress, or data reflecting improvements to the system.”
“Most transaction-oriented companies will not be disappointed by the debut of robotaxis,” Piper Sandler analysts said in a separate note on Friday.
“We would not be surprised if the stock sells off in the coming weeks as momentum weakens before the event,” the investment bank analyst said in a note.
They added that while there were moments during Thursday’s live event where it was “hard to suppress a smile,” many investors expected the company to “deliver something more concrete.”
With self-driving cars expected to be several years away from becoming a mainstream reality on public roads, regulators are concerned about the safety features embedded in such vehicles.
Google-owned Waymo is one of the few companies to successfully launch self-driving cars on public roads. The robotaxi service has been available to the public since June.
—CNBC’s Lora Kolodny and Michael Bloom contributed to this report
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