After Elon Musk unveiled Tesla’s new Robotaxi, Wall Street surprisingly reacted with disappointment, with the company’s shares falling around 6% in Friday’s premarket trading session, according to a Wall Street Journal report, which added that this led to a $40 billion slump in the EV maker’s valuation.
The Robotaxi was a two-seat stage five autonomous vehicle without a steering wheel or pedals that Musk had called as Tesla’s most significant launch since the Model 3 came in 2017.
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Why were investors not keen on Tesla’s new Robotaxi?
“Investors we spoke to at the event thought the event was light of real numbers and timelines,” the report quoted Tom Narayan, an analyst at Royal Bank of Canada as saying. “These typically come at Tesla events. This one seemed focused on branding and marketing Tesla’s vision.”
This is because Musk painted a picture of a green, sunny future with autonomous vehicles eliminating parking lots and rush-hour traffic, with only one brief mention that the vehicle would enter production in 2026 and cost less than $30,000.
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However, the stock did see an anticipation-driven rally before the event unfolded, which made Tesla’s stock market valuation worth close to three times as that of Toyota, the world’s best-selling carmaker, according to the report.
“Making the leap from where we are today to full autonomy (particularly through unsupervised vehicles with zero steering or pedals) is so gargantuan, technology-wise, that it feels overly ambitious in such a short period of time,” the report quoted Jessica Caldwell, head of insights at car-shopping site Edmunds as saying.
Musk also announced that an unsupervised version of Tesla’s full-self driving (supervised) system will come next year, but analysts and investors are skeptical due to Tesla’s record of missing deadlines for the claims they make, according to the report.
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