The unveiling of Tesla’s Cybercab, a fully autonomous robotaxi, was met with widespread criticism and did not have the anticipated effect on financial markets. Despite high expectations, the event left investors wanting more, leading to a dramatic drop in Tesla’s stock value, wiping out nearly $67 billion in market capitalization.
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A 8.7% Drop
On October 10th, Tesla held its “We Robot” event in Los Angeles to showcase its latest advancements in autonomous driving. As we’ve mentioned, the Cybercab, a model of robotaxi without a steering wheel or pedals, was the highlight of the day. However, the lack of specific information about its launch and growing regulatory concerns significantly dampened investor enthusiasm. The following day, Tesla’s stock plummeted by 8.7%, closing under $220, marking its biggest drop since August 2024.
A Particularly Lukewarm Reception
While some still praise Tesla’s futuristic vision, many voiced their deep disappointment over the lack of substantial content. Analysts from Wells Fargo and Bernstein criticized the event for not providing details on regulations and the timeline for Cybercab’s deployment. These criticisms were exacerbated by the fact that the conference, originally scheduled for August, had been postponed several times, creating massive expectations that were not met during the unveiling.
Concerned Investors
Beyond technological aspects, Tesla’s decision to forgo a project for an affordable electric vehicle (under 25,000 euros) in favor of the Cybercab was seen as particularly risky. For Elon Musk, who has grand visions for autonomous shared mobility, this shift away from a potentially lucrative short-term option has left many investors skeptical. The lack of clarity on the initial financial outcomes of this project, expected at the earliest in 2027, adds further uncertainty.
Competitors Capitalize
As Tesla faces challenges with its robotaxi project, competitors like Uber and Lyft are seeing their stocks rise. Uber experienced a 6% increase on the same day, and Lyft saw an 8.6% gain. Analysts believe that the delayed launch of the Cybercab benefits these transportation industry players, who are further solidifying their positions. Tesla must quickly find a way to regain confidence and momentum to prevent these rivals from widening the gap.
What are your thoughts on this situation and these announcements?