Tesla’s roller-coaster saga continues, Elon Musk has rescheduled the much-anticipated Robotaxi reveal to October, deeming everything beyond autonomy as mere “noise“.
This comes against the backdrop of Tesla’s second-quarter earnings report, which shows a dramatic 45% plunge in net income despite a modest 2% revenue increase to $25.5 billion.
Tesla’s gross margins, often a source of bullish dreams, remained in the spotlight with a slight uptick to 18%, up from 17.4% last quarter.
However, this is hardly a victory, considering it’s still lower than Q2 2023 and at a six-year low thanks to Musk’s strategy of rampant price cuts and cooling demand.
Tesla remains optimistic
Despite this financial mess, Tesla’s letter to shareholders painted a rosy picture, celebrating the global growth in EV penetration, and talking about media manipulation…
According to the company, the world is finally seeing the light about EVs as myths around range and charging are dispelled. “A pure EV is the optimal vehicle design,” Tesla proclaimed, hinting at a utopian future where everyone drives Teslas and world peace is achieved.
Powerwall & @Tesla_Megapack together achieved record storage deployments of 9.4 GWh in Q2 pic.twitter.com/cDO7lS2UP4
— Tesla Energy (@teslaenergy) July 24, 2024
Amidst the chaos, Tesla reported better-than-expected delivery and production numbers earlier this month.
Though production and deliveries are down 4.76% and 14% respectively from last year, Wall Street had braced for worse, and Tesla’s stock briefly soared on this faint glimmer of hope.
The Robotaxi dreamboat
Tesla’s quarter was nothing short of a soap opera.
The company first ditched plans for an affordable “Model 2” vehicle, only to recommit to it.
Musk announced an August Robotaxi reveal event, then postponed it to October, citing a need to redesign elements of the prototype. He assured investors that the delay would lead to a better product and “a couple of other things,” leaving everyone guessing what those might be.
Musk has made it clear that the future of Tesla lies not in selling more EVs, but in achieving full autonomy. This vision, however, hasn’t been cheap.
Musk laid off over 10% of Tesla’s global staff earlier this year to refocus on AI development, including the Optimus humanoid robot, another ambitious project now quietly delayed.
This restructuring cost Tesla a cool $622 million, further denting its earnings.
The man in question does not stop with technology
Amidst all this, Musk’s political antics added a delightful twist. Endorsing Donald Trump for president, Musk plunged Tesla into turbulent political waters, potentially jeopardizing its brand and sales.
What could possibly go wrong when the CEO of a leading tech company takes a polarizing political stance? Right?
The financial report showed Tesla’s profit padded by a record $890 million in regulatory credit sales, which helped soften the blow of the sharp decline. Automotive revenues, however, dropped 7% to $19.9 billion. For a company supposedly on the cutting edge, this backslide in its core business is rather telling.
Facing the prospect of selling fewer EVs in 2024 than in 2023, Tesla has reassured investors that it’s just in a lull between “two major growth waves”.
Pinning hopes on the expensive and divisive Cybertruck and some mysterious, lower-priced models, Tesla continues to promise the moon while grappling with earthbound challenges.
Tesla Robotaxi unveil on 8/8
— Elon Musk (@elonmusk) April 5, 2024
Musk’s long-standing promise of fully autonomous vehicles remains unfulfilled, with Tesla under scrutiny from various government agencies and facing lawsuits from disgruntled owners. On the recent earnings call, when asked about the timeline for unsupervised Robotaxi rides, Musk’s response was predictably optimistic—perhaps by the end of the year, or maybe 2025. Classic Elon.
As the October 10 Robotaxi event looms, Tesla’s future seems precariously perched on Musk’s grandiose visions of autonomy. The specifics of what will be unveiled remain shrouded in mystery, but Musk’s track record suggests a mix of hype and delayed reality.
For now, investors are left waiting, watching, and hoping that this time, the promises might just be more than hot air.
Featured image credit: Prometheus/Unsplash
