What to expect from Tesla's robotaxi event
Sep. 28, 2024 10:10 AM ET
By: Clark Schultz, SA News Editor
 Hiroshi Watanabe
Tesla will host a high-profile robotaxi event with the title "We, Robot" at Warner Bros. Studios in Burbank, California on October 10. The event was originally scheduled for August 8 before Elon Musk said the company needed more time to make an important design change and to prepare to show off a few other things.
The highlight of the event is likely to be the reveal of a Cybercab protype, which is anticipated to be a two-door sedan with a front that is relatively similar to the Model 3. Elon Musk and gang could also deliver estimates on the size of the robotaxi market, a timeline for achieving unsupervised FSD, the potential for incremental AI-driven revenue, and other applications of the company's growing robotic technology.
Bank of America said expectations for the event have tempered since it was pushed back in terms the timing of a robotaxi fleet launch, but sees the event as helpful for investors to understand the current capabilities of Tesla's (NASDAQ: TSLA) Full Self Driving technology, how the robotaxi business might operate and be structured, and updates on regulatory approvals in Europe, China and other countries. The firm does not expect a robotaxi service to be available until after 2025. The electric vehicle maker's robotaxi offering is expected to leverage the existing fleet of Tesla ( TSLA) cars as well as Tesla-owned vehicles. Tesla ( TSLA) is expected to reveal a prototype of the new Cybercab as part of the robotaxi event and outline other robot applications.
Morgan Stanley warned that Tesla's ( TSLA) robotaxi event on October 10 could fail to live up to the high expectations of investors. Analyst Adam Jonas said that other than demonstrating FSD v12.5 and offering rides in a Gen 1 Cybercab, the firm is not sure what else could be in store. Jonas said questions that could be addressed include will investors see data comparing the safety of Tesla’s ( TSLA) AV vehicle technology compared to human driving, and what are the specific critical enabling technologies to drive further improvement in FSD/cybercab autonomy? As far as moonshots, Jonas advised previously that Tesla ( TSLA) could introduce an electric plane concept, electric boat vision, or a demonstration of an Optimus robot flipping burgers at a Tesla Diner. Other Wall Street analysts are also predicting some long-term autonomous concepts will be teased.
The other robotaxi players
Uber Technologies (NYSE: UBER) and Chinese electric vehicle maker BYD Company ( OTCPK:BYDDF) are preparing to build what appears to be the start of a global robotaxi service. Uber ( UBER) also recently announced that the Uber app will soon offer rides in Waymo's self-driving cars in Austin and Atlanta. WeRide and Uber Technologies ( UBER) also reported a strategic partnership to bring WeRide’s autonomous vehicles onto the Uber platform, beginning in the United Arab Emirates. The partnership is expected to launch first in Abu Dhabi later this year. Uber Technologies ( UBER) also has a multiyear strategic partnership to bring General Motors' ( GM) Cruise autonomous vehicles to the ride-sharing company's platform. Cruise has a fleet of about 1,200 vehicles and has previously operated in San Francisco, Austin, Dallas, Houston, and Phoenix. Notably, Cruise has resumed supervised autonomous driving in Phoenix, Houston, Dallas, and is testing in Dubai. Pony.ai, May Mobility, Baidu's ( BIDU) Apollo, WeRide, AutoX, Aurora Innovation ( AUR), and Motional ( APTV) ( OTCPK:HYMTF), and Amazon's ( AMZN) ZOOX ( ZOOX) also have robotaxi initiatives up and running.
Shares of Tesla ( TSLA) are up 5.6% over the last week. While the EV giant will issue its Q3 deliveries report on October 2, the robotaxi event on October 10 is considered the bigger potential catalyst. Will the event lead to more share price gains on robotaxi and FSD buzz, or a share price slump if the technology timeline disappoints? Shares of Tesla ( TSLA) have a general track record of rallying into major events, and then giving back some of the gains in the week following. |
