Comment by harshaw 4 days ago
I am confused about what Tesla is doing. They have effectively two automobile products now with one failed product (cybertruck). reading various articles about this doesn't make it more clear. Do they not want to be a car company?
If the problem with being a car company is that they'd have to compete with China, then I have some bad news about being a robot company. China is already farther ahead in both technology and volume of humanoid robots.[0][1][2][3]
[0] https://www.cnbc.com/2026/01/28/cnbc-china-connection-newsle...
[2] https://interestingengineering.com/ai-robotics/limx-humanoid...
[3] https://www.bgr.com/2083491/china-agibot-humanoid-robot-us-c...
If you think of Musk companies as vehicles to extract money from state and federal governments, then everything falls into focus. Carbon credits, government launches and the Quixotic quest for Mars, and soon Tesla robots sold to the DoD and DHS. I'm only half-joking.
Is there anything China isn't far ahead in? Maybe capitalism was a failure.
Market cap and it's not even close. Turns out financialisation is the classic you-get-what-you-asked-for-not-what-you-wanted of capitalism. We told the optimiser to make number go up, and number has certainly gone up. China's number? Not as up.
I think it could have gone differently if we gave our economic system something to optimise other than itself, but then we wouldn't have centibillionaires, so... swings and roundabouts I guess?
Who cares which country has a higher market cap? That's a capitalist concept, of course the capitalist country has more. I'm talking who has the more advanced technology.
>Maybe capitalism was a failure.
China is hyper-capitalist. They're living proof that capitalism has won.
It doesn't help that Musk supported a guy who turned around and gutted the incentives that were helping Tesla turn a profit.
It seems counterintuitive, but this helped Tesla which is why Musk championed it. Basically when that tax credit came out, a bunch of Tesla owners had their cars underwater - loans were more than new cars were selling for and depreciation thru the roof. Plus the tax credit helped their competitors. Now that the credit is gone, Tesla owners are closer to being in the black on their cars and it also caused Ford and GM to cut EV production by I believe 100%. Win win for Tesla.
> It seems counterintuitive, but this helped Tesla which is why Musk championed it. Basically when that tax credit came out, a bunch of Tesla owners had their cars underwater - loans were more than new cars were selling for and depreciation thru the roof. Plus the tax credit helped their competitors.
This makes sense if your business strategy is to get existing Tesla owners to trade their current Teslas to buy new Teslas, rather than to convert non-Tesla owners to buy new Teslas. The latter market is WAY bigger and the tax credit was a huge carrot enticing them to look at a brand they'd never try otherwise in a market where ICE vehicle prices were skyrocketing.
As it stands, there are a ton of Tesla owners who bought their cars with the tax refund, are underwater on them, bitter about it and/or dislike Elon personally, and will never buy a Tesla again. This is churn and brand destruction without a corresponding top of funnel increase.
In contrast, the supercharger network was significant not just for the convenience factor for Tesla owners, but also for the fact that it was a social signal that Tesla was serious about growing the addressable market of EV owners generally by not just making a decent car but making the "EV lifestyle" seem possible to non-EV owners.
If Tesla actually is happy that the tax credit is going away, that seems like they're acknowledging that they're satisfied taking shrinking share of a shrinking market, which is their prerogative, but it's a bad business.
You lost me, how does making previous owners whole help tesla sell new ones?
If your existing owners have made a "profit", or at least lost less to deprecation than normal, they're probably more willing to buy a new car from you (trading or selling their existing one) even if that new car is more expensive and they're actually paying just as much to upgrade as they would be anyway.
Of course, it's 4D chess. This was such a genius move that Tesla profits fell 46% last year and they are ending production of their highest-margin vehicles.
GM wrote down $4B when they reduced their EV production. Despite that, last year GM sold half the number of EVs as Tesla did. If THAT was reduced production by 100%, then Tesla would have been truly fucked had Harris won the election.
Tesla is suffering because Elon Musk was a genius at some point in the past. Then, he got into ketamine and fried his brain.
The cars are expensive, have QC issues, and are facing steep competition from the rest of the world. Tesla's attempt to build an F150 competitor was a disaster, Optimus is years away from being useful for anything, and after 15 years of "We'll totally release FSD this year!" the market seems to finally be realizing that it's not going to happen for a little while.
It really sucks to see a perfectly good company get blown to smithereens, but shareholders did choose to bet on the man.
This seems bizarre. Only reason my family bought a Tesla is thanks to the ev tax credit. Without it there are far better options.
The problem with being a car company is that they'd have to compete with China.
As if China cannot produce kick ass robots ? What special sauce does Musk have here that a country with a massive pool of highly trained and educated engineers and decades of manufacturing expertise don't have?
I would bet that as soon as someone "solves" robots. China will relatively shortly, that is months or few years produce something that surpasses them. They have all the pieces and all the capabilities. Just look at drones for example. It just requires correct solution and China might even be first to provided that.
I'm sure China can. But nobody is producing consumer humanoid robots at any scale yet, so Tesla can at least make the argument that they'll make better robots when people actually start buying robots. People are buying cars at scale right now, and existing Tesla models have fallen behind their Chinese competitors.
Tesla "competed" by corruptly getting BYD banned from the US and hurting US consumers.
Looks like they took Peter Thiel’s animosity towards competition too literally by blocking BYD from the US market. Without competition, they had no incentive to innovate since they were selling into the wealthiest market in the world for their product, the US.
No innovation made them stagnate. Being blocked from the US made BYD innovate.
He generated a lot of goodwill with "that DOGE fiasco", too. It just depends on where you fall politically.
Elon generated goodwill with DOGE among a group of people. He then alienated them during a public spat with the president. This is also a president who has decided to make EVs synonymous with the opposition political party.
Which is interesting because it seems DOGE failed to do anything useful. Patrick Boyle’s video suggested it actually cost $100B.
Which would be par the course for Ketamine Elon
Nobody's buying EVs in the US since the subsidies expired. GM had a record Q4 because it gave up trying to sell EVs and started flogging expensive land yachts again.
Elon's a strange hero for MAGA. All the hardcore rural MAGAs I know hate Elon. They consider him a rich dickhead nerd (and group him with Gates) and they hate EVs with a passion, since they are quiet and produce no black smoke.
Automotive stocks are subject to the rules of gravity, aka "boring", while tech stocks are not. Automakers operate on low margins and high volume, and must compete on price, reliability or luxury brand status. Most automakers have multiple brands to sell to all market segments.
Tesla's value proposition was that it was going to be an iPod in a world of identikit MP3 players, and charge a premium for it. One brand to rule them all, no pesky dealerships, with futuristic EV tech and a touchscreen dash that made gas-powered, tactile button-laden cars obsolete.
That was twenty years ago. Tesla went from leading the pack to struggling to achieve scale, with its limelight-seeking leader increasingly holding it back. The leader wants headlines for pioneering "cool shit" and pushing hype to pump the stock price. Buyers on the other hand want affordable and timely repairs (impossible with their resistance to third party body shops and unit cost of replacement parts). As a mature company, it is completely un-equipped to compete with the incumbents whose leaders, not by coincidence, are all largely unknown to the public.
> Tesla's far more popular models are the 3 and Y, which accounted for 97% of the company's 1.59 million deliveries last year. The Model 3 now starts at about $37,000, and the Model Y is around $40,000. Tesla debuted more affordable versions of the vehicles late last year.
I’m confused as to what’s not clear from the article for you?
Apparently Tesla dropped 4680 battery production for the CT by 99%, so the CT isn't long for this world either.
But that's okay! They have the Cybercab that will 100% drive itself For Real This Time, $99/mo Autopilot/FSD subscriptions and robots that will theoretically wash your dishes in an age where most people have an adversarial relationship with anything AI, so.
I'm not disagreeing with your overall take, but Tesla and other EV manufacturers have released the same model of vehicle with different battery technologies at different times. Only saying that dropping 4680 production isn't conclusive proof itself.
It's the 4680 cell that is only used by CT at the moment: https://www.autoevolution.com/news/tesla-cybertruck-on-its-w...
Check out videos of Chinese car company factories. They are far more automated and futuristic than Tesla’s. Most of the new ones have almost no humans in them at all. They have great supply chains and partners for everything that is an input into these factories, and they’re often just up the street from the car factories. The costs are rock bottom and the competition between car companies in China is absolutely bananas.
How do you suppose Cybertruck is a failure? I see just as many of them as Rivians, while releasing over 5 years later.
They built production capacity for 125,000-250,000 units per year. They are selling around 20,000 units per year.
It was supposed to cost $39k at the low end and have 500 miles of range at the high end. This drove the hype and high reservation numbers.
In reality it costs $79k and offers up to 325 miles of range. Doubling the price is going to significantly limit the reach of the product.
Ignoring who makes it, this kind of gimmickmobile usually sells well for about a year, and then everyone who wants one has one. It was never going to be a tentpole.
Rivian isn't exactly selling well either.
Perhaps more interesting is the F-150 Lightning outsold the Cybertruck in 2025 and Ford still canceled it as a failure.
I regularly see Rivians. I've never once seen a Cybertruck in real life. (Midwest USA)
Humanoid robots make sense in only one context I can think of, and I definitely wouldn't put it past Musk to enter that market. It will be a big one. He may just be waiting for material science to catch up with his product vision. Much like Steve Jobs waited by the river until capacitive multitouch came floating by, and then pounced on it.
Meantime, as others have pointed out, the Model S and X are not selling enough to justify keeping the factory running. I don't see them going into Optimus production immediately, since as you suggest it's a solution looking for a problem.
About a decade ago, Musk said he wanted to kickstart the electric car industry, make electric cars cool by showing they can be high performance and promising not to enforce Tesla's patents against competitors. Remember how electric cars used to be perceived? The Simpsons put it as "people will think you're gay". I'd say he completely succeeded in that goal and the whole "make piles of money for investors" is just because investors decided to try doing that.
The X and S were always very low volume niche products unlike the much more mainstream Y and 3. I wouldn’t read much into it.
I would. Someone in the market for a presumably profitable BMW 5 or 7 series isn't going to stay with BMW and drive a 3 series.
Yearly sales of model X have been comparable to the 5 series, at least until last year when musk's political activities took the shine off the brand.
High end cars are more profitable. There are millions of 3 and Y owners with positive experiences who would stay with the brand if it had something to move up to.
My 23 MX is the best car I've ever owned. I wouldn't buy the current iterations of 3 and Y.
Most refresh X owners think it's pretty great (not perfect). There are no alternatives at the moment, mostly because other manufacturers are terrible at software development...and that's not good for software defined vehicles.
It's sad to see Tesla walk away from the luxury segment so they can focus on robots, go karts, and robots pretending to drive go karts.
S you can understand, because sedans are dead. But every other US auto company is making big profits with large SUVs, so I don't get dropping X.
Agree with other posters who say whatever you think of Musk, Tesla styling has gotten very stale.
Tesla have always said the design of the X was a mistake of over-engineering. I'm guessing there was no money to be made from it, especially as the sales dwindled.
Yeah, from the pictures of the underside I saw, it looked like a very solidly-built car. (Makes me considered buying one after they the depreciation curve.) Still its a big $$$ segment for everyone else.
They are almost exclusively focused on autonomous cars, humanoid robots, and energy (batteries now, maybe more solar manufacturing later).
As much as I dislike it, I can't disagree with the business case here. They already have >300k monthly subscribers at about $100/month. That business will grow rapidly from here as well as the robotaxi business itself.
Within 2 years, this business will look radically different just because of these two changes.
EVs are becoming commoditized. Tesla doesn’t have the scale ( or experience ) to play that angle.
At the moment most of them are running notably below capacity.
Tesla's growth plan originally had them doing factory expansions and new factory in Mexico by now, but instead they have pivoted to trying to keep utilization of their existing lines up by introducing cheaper trims of existing vehicles.
Batteries - lots of uses beyond EVs, but lots of EVs are making use of the batteries they can produce, as well.
The benefit of having control is that they can adapt them to their priorities. Similar Apple designing its own chips when there were already viable producers in the market.
They won’t need to rely on others prioritizing their priorities, like low volume, high cost early investments in batteries designed for a market (humanoid robots) that doesn’t exist.
If they then scale them up, they also have the benefit that there is no 3p supplier who can turn around and sell those to a competitor.
Sure. And selling the most popular car on the planet is a failure?
Didn't the US government put ~$80b into rescuing GM etc, years ago?
Subsidies bootstrapped the EV industry. Stupid policies mean walking away from the investment, ceding the market to foreign competitors, and doubling down on legacy ICE crap the rest of the world no longer wants...and Americans will be less and less able to afford.
>the most popular car on the planet
That's the Toyota Corolla. I find this inaccurate glazing of musk to be relatively common but it always strikes me as profoundly weird.
To be charitable, according to at least some reports, the Model Y was the best selling car of 2024.
I was googling the data for 2025 and it seems that it’s number 2 now (behind the RAV4 to my surprise) with the Corolla at 3.
No idea how accurate these are, finding global numbers was harder than I thought.
it's very difficult to have a conversation about this, because it would appear that sincere answers to your question will get downvoted. one POV is that, if you accept the bear case from Internet commenters that these guys are incompetent or stupid - blah blah blah, Cybetruck - the existence of their autonomous taxi product is extremely bullish. they managed to pull off something similar to Waymo despite being so much worse at it, yes? I'm not sure they will even need a diverse product line of premium cars, if they can sell an autonomous 3 for the price of a small house. on the flip side, the bear case there is, if they could figure it out, so will a lot of other car companies. and yet, Cruise ceased operations, and Tesla will seemingly pay a manageable amount of blood money for Autopilot and move on.
nobody really can predict the future, so unsurprisingly, "reading various articles about this doesn't make it more clear." but people on the Internet keep getting worked up about it. to me, people do not comprehend the meaning of "high risk, high reward."
I love FSD and I know it well. I probably wouldn't feel super comfortable in a Tesla taxi. I've seen too much.
Tesla doesn't even trust their own full self driving system. They still have safety monitors for their self-driving taxi service.
The Las Vegas Loop continues to have actual drivers and that's an enclosed space entirely controlled by Tesla. If you can't even trust it in a single lane space you completely control, how can you trust it in the real world?
If you think it is, take your hands of the wheel and close your eyes. Fall asleep at the wheel. Not willing to do so? I guess your car isn't really driving you everywhere.
Your view on how stocks work is interesting as well — you realize most of the investors are regular, uninformed non-techies who invest based on vibes, right? Vibes like "my car is driving me everywhere, this is the future!" — the exact same thoughtless, surface-level analysis you're going off of.
Therefore, you're trying to beat the market by using the exact same reasoning 99% of its investors have used. Good luck.
> they managed to pull off something similar to Waymo despite being so much worse at it, yes?
similar?! what exactly is your definition of similar? tesla and waymo are so far apart that it is difficult to accept any argument that tries to make this comparison. they cannot co-exist in the same sentence unless to explain one’s success against the other’s failures
- https://x.com/Waymo/status/1924931187274826077
- https://x.com/Waymo/status/1945106097741664630
will leave it to the astute reader to look up “robo”taxi
When Tesla started producing cars, everyone wanted what they proposed. Now, no one wants the cybertruck. No one is really asking for humanoid robots. Their self driving is vastly inferior to waymo when it comes to taxies, I can't see them winning that market. Their batteries and solar panels, like their cars, seem to be more or less abandoned.
So, it's pretty easy to see why people are confused and upset. Tesla is discontinuing all the things people like about Tesla, and selling vapourware that no one really wants anyways, instead. It's also not "a difficult conversation."
What seems more likely is that Musk, in his extreme shift to the right, has abandoned the original goal of Tesla: producing sustainable electric vehicles. He's become more and more delusional, with failing like the Boring machine and the Cybertruck starting to pile up. He's alienated his existing customer base by both getting into politics and dropping any pretext of trying to help the environment.
From my point of view, Tesla is a failed company with a leader who has gone off the rails, and a board that refuses to reign him in. Revenues are falling off a cliff outside of US governmental money, and it's betting the whole ship on only two ideas: self driving, which is so far no where close to being where it needs to be, despite the progress, and on yet another fairy tale that is humanoid robots.
imo their competition for autonomous vehicles doesn’t come from car companies, but from tech companies.
Amazon has a lucrative incentive to automate its supply chain up to and including last mile delivery. Waymo has proven out the tech and could easily partner with Uber or Lyft for the rider experience and reach.
If you’re FedEx, for example, would you rather buy from Amazon or from Tesla? Who is more likely to be a sane and trustworthy partner?
I don't think that Uber or Lyft are going to invest in self-driving taxis. The capital model is completely different: Uber and Lyft are by design capital light, they own nothing more than the software (1), and someone needs to buy all of these self-driving machines and then someone needs to maintain them, whereas their current model doesn't do that- they can't offer that to any tech partner.
The reason that you don't see more Waymo areas has nothing to do with rider pool or experience, it is because their tech requires pre-mapping everything with LiDAR several times- the advantage is that if you know what is static (because it was in all of that LiDAR mapping) then a simple difference algo can tell you everything that is dynamic in the environment. (Also, they are just starting to hit cities with significant precipitation- SFO, LA, ATX, PHX are all pretty dry cities, they are going into ATL, MIA, DC, DEN, etc.)
1: With a lot of suspicion that much of their profit comes from drivers not understanding depreciation of their vehicles, something that the accountants who work for Uber and Lyft will understand very very well.
Uber, and to a lesser extent Lyft, has been an extremely prolific investor in the autonomous vehicle space. They're absolutely paying attention to it.
Similarly, Waymo isn't bottlenecked by mapping or rain. I've seen enough of them testing in Seattle and Tokyo, as examples.
Uber spent billions trying to make self-driving work, until they gave up. Not "by design".
Nvidia follows the same strategy because having a large end-to-end model is how you get your customers to buy GPUs with their AI slush fund (and I don't think they limit themselves to vision).
His rationale at this point seems to be mostly stubbornness, coupled with a healthy dose of anxiety when he considers how much money he'll have to spend to deliver FSD to the people who bought it 10 years ago.
Its not that strange; normally manufactures are focused on volume and brand. So you have the 3 and Y in numbers where they can compete in the mass market price range; and CT and FSD for brand notoriety.
S and Y are not special enough to do anything for the brand, they dont qualify as halo products anymore. Probably still wouldnt be that interesting even if refreshed.
CT is still interesting, it looks different and has some tech inside that seems worthwhile to iterate on.
And unlike traditional brands, tesla has FSD, Optimus, and Musk to do enough to keep the brand itself healthy.
My guess would be they are deciding what they can learn by iterating the CT, and might decide to drop it in a year or two when the roadster takes the halo role.
They will keep trying to improve on volume for 3 and Y.
You should probably keep reading.
Elon for years has said Tesla is not a car company. He’s also said the “factory is the product.” Tesla also has energy divisions and investments, as well as xAI investments now.
Logically given that Model S and X are something like less than 5% of deliveries (and have been for years), if they’re right about Optimus, that capacity will generate far greater revenue.
Do they have enough people to remotely operate that many Optimuses?
They can probably hire enough random dudes in India, especially if AI reduces the need for call center employees.
It will be slightly creepy when the Optimus walks into the bedroom and stares while its owner is ... in the middle of something, but that's a small price to pay.
Plus the Tesla employees in the U.S. will also be able to share the video, so it's a win-win.
This is interesting. If Optimus hardware is supposed to be $15k, and Indian workers remotely operate it, there must be jobs in the US and elsewhere that it can handle. Median Indian salary is $4000 a year. No US minimum wage, no overly expensive health care, no Union fees, no workers comp, no visa. 86% savings over a US worker at $15 an hour. Plus, if they are a maid, there's a chance they'll get a free peek.
The problem with being a car company is that they'd have to compete with China. It's possible, but they'd have to make additional capital investments to keep up. They've just wasted a ton of money on a failed Musk vanity project (Cybertruck) and squandered a ton of goodwill in their home market via the DOGE fiasco. Cash flow is not what it once was, and if they're going to make a big capital investment, they're probably right in looking at robots. But that strategy puts them back where they were 20 years ago, just getting started in EVs, and their cash flow will depend on cars for many years to come.