Tesla's "We, Robot" event fell short of expectations, as analysts from Morgan Stanley and Oppenheimer expressed disappointment regarding the lack of crucial details and updates on key developments concerning the company’s latest electric vehicles. At the late Thursday event, Tesla presented prototypes of two new vehicles: a compact two-seat model dubbed "Cybercab" and a larger 20-person vehicle known as "Robovan." According to insights provided in research notes, the Cybercab features two gullwing doors and omits a traditional steering wheel, signaling a bold leap toward autonomous driving.
Production of the Cybercab is anticipated to start in 2026. Morgan Stanley noted that it’s reasonable to expect a variety of seating and interior configurations, given the limited market appeal and utility of a two-seat vehicle. Tesla's Chief Executive Officer, Elon Musk, has communicated that the Cybercab is expected to retail for under $30,000.
However, the ambiguity surrounding whether this figure reflects pre- or post-incentive pricing leaves potential buyers in a state of uncertainty, as commented by the brokerage. During the event, substantial information regarding the Cybercab’s functional capabilities was notably absent, save for a brief mention of inductive charging.
This lack of transparency has led many, including analysts, to interpret the Cybercab as a repackaged version of the Model 2 prototype, now presented as an autonomous vehicle. Morgan Stanley's disappointment was further articulated in their client notes, highlighting that the overall presentation lacked depth and substance.
Compounding these concerns, Tesla's stock saw a significant decline, plummeting 7.8% in trading on Friday and totaling nearly an 11% loss for the year to date. Just last week, the company reported third-quarter delivery figures that fell short of market expectations. Oppenheimer’s analysis echoed similar sentiments concerning the previous underwhelming details surrounding the Robovan.
The analysts raised questions regarding the operational autonomy of both the Robovan and Cybercab, expressing skepticism about their capabilities in fully autonomous mode. As Tesla paves the way towards introducing a fully autonomous unsupervised Full Self-Driving (FSD) system in Texas and California by 2025 for its Model 3 and Model Y, the event failed to deliver any substantial updates regarding progress in FSD technology.
The absence of demonstrations or insights into the advancements of FSD, as well as the lack of a clearly defined go-to-market strategy for a ridesharing service or relevant economic inputs for investors, compounded the disappointment. FSD is a driver assistance software platform that Tesla offers, and there was a clear lack of clarity presented during the event.
Accordingly, Oppenheimer pointed out that while Tesla communicated intentions to market the Cybercab initially, no enhancements to the user interface or app functionalities were presented, leaving investors uncertain about the company's value capture strategy beyond vehicle sales, which subsequently limits the stock’s upside potential. Additionally, the event provided no insights into the learning rates of the FSD software or the effects of the company's growing computing resources on vehicle performance.
Notably, the presentation excluded any revealing of new technologies such as a drone or last-mile delivery aid. Analysts further opined that Tesla's Optimus humanoid robot seems to be very much in its developmental phase without any conclusive demonstrations to showcase its utility. Critics have pointed out the absence of information regarding production plans for its low-cost vehicle line as well as a lack of testing for the robotaxi concept or humanoid functionalities in more demanding environments.
While believing that a window of opportunity remains for the company, Oppenheimer has conveyed that the overall capabilities of the platform are promising, but the recent event has left many investors feeling underwhelmed..