Musk’s Robot Revolution: Will Tesla Soar or Stumble?

Tesla’s stock saw an uptick on Monday as Elon Musk emphasized the potential of the company’s humanoid robots. Musk announced on X that Tesla aims to have functional humanoid robots in limited production for internal use by next year, with hopes for broader availability to other companies by 2026.

Earlier in April, during Tesla’s annual shareholder meeting, Musk shared that production of the Optimus robot would begin in a limited capacity by 2025, anticipating over 1,000 robots operational at Tesla by year-end. Currently, two robots are in use at the factory, though Tesla has not disclosed their specific tasks.

Musk posited that the robots could add as much as $20 trillion to Tesla’s market value, with expectations that they will be available for sale by late 2025 at prices ranging from $20,000 to $30,000.

However, the definition of “genuinely useful” robots remains vague, especially following less impressive product demonstrations. In May, Tesla faced criticism for a video that claimed to show an Optimus robot folding a shirt, which was later alleged to involve off-screen human control.

Tesla’s history includes using dramatic presentations to showcase its robots. The company first introduced the Optimus project in 2021 with a demonstration featuring a person in a robot costume.

“Musk’s ambition for a sentient humanoid robot by 2025 seems overly optimistic,” noted Craig Irwin, an analyst at MKM, during a discussion on Yahoo Finance. He remarked on the challenge Tesla faces in competing with established players like Boston Dynamics, stating that what Tesla has shown recently feels outdated.

In addition to Boston Dynamics, Tesla is up against Japan’s Honda and Apptronik. Chinese firms Dongfeng Motor and Nio are testing humanoid robots from UBTech Robotics in their production lines, while BMW has been utilizing humanoid robots from Silicon Valley’s Figure since early January.

Following Musk’s remarks, Tesla’s stock increased by over 3% on Monday. Year-to-date, shares are relatively stable after experiencing a significant rebound in recent months. Tesla is set to report its second-quarter earnings on Tuesday, where Musk is anticipated to provide updates regarding the delayed launch of the robotaxi.

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