Friday, July 12, 2024

Tesla shares fall 6% after report of robotaxi unveiling delay


Elon Musk, CEO of SpaceX and Tesla, speaks during the Milken Global Conference 2024 at The Beverly Hilton in Beverly Hills, California, on May 6, 2024.

David Swanson | Reuters

Tesla shares fell about 6% on Thursday after Bloomberg reported that the electric vehicle maker is delaying the unveiling of its Robotaxi by two months.

After previously announcing that it would introduce its robotaxi on Aug. 8, Tesla has pushed the launch back to October to give teams working on the project more time to build prototypes, according to Bloomberg, which cited people familiar with the decision.

Tesla did not immediately respond to CNBC’s request for comment.

Tesla’s stock slump on Thursday followed an 11-day rally that was sparked by a better-than-expected deliveries report for the second quarter. That jump wiped out the stock’s loss for the year. However, the shares are now back in negative territory for 2024, a year that has been marred by sweeping layoffs and a drop in sales due in part to an aging lineup of EVs and increased competition in China.

Tesla CEO Elon Musk has promised shareholders a robotaxi for years. In 2015, he said Tesla’s cars would achieve “full autonomy” within three years. In 2016, Musk said Tesla would be able to send one of its cars on a cross-country drive without requiring any human intervention by the end of the following year.

The empty promises continued into 2019, when Musk said on a call with institutional investors that Tesla would have one million robotaxi-ready vehicles on the road in 2020. However, the company has yet to deliver a robotaxi, autonomous vehicle or technology that can turn its cars into “level 3” automated vehicles. Meanwhile, companies such as Alphabet’s Waymo and Cruise, owned by General Motors, have leaped ahead of Tesla.

Following a dreary first-quarter earnings report in April, Musk reiterated his vision of Tesla as a company dedicated to developing robotaxis that will make money for their owners and a driverless transportation network.

“If somebody doesn’t believe Tesla’s going to solve autonomy, I think they should not be an investor in the company,” Musk said on the earnings call. The company is scheduled to report second-quarter results later this month.

At Tesla, “unveil” dates do not predict a near-future date for a commercial release of a new product. For example, Tesla unveiled its fully electric heavy-duty truck, the Semi, in 2017, and did not begin deliveries until December 2022.

— CNBC’s Lora Kolodny contributed to this report.

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