Tesla and CEO Elon Musk aimed to create significant excitement for the “We Robot” event, but the market reaction was lackluster after the unveiling of a Cybercab and Robovan. Musk’s claim that fully autonomous driving would be achievable “next year” left many investors unconvinced, particularly as he provided no updates regarding an anticipated “affordable” electric vehicle.
The event, while visually impressive with Musk arriving in a two-seat Cybercab lacking a steering wheel, was criticized the following day for its lack of substantive detail. Analysts pointed out that the spectacle did not deliver the in-depth information they were hoping for. Adam Jonas from Morgan Stanley, a known advocate for Tesla, expressed disappointment over the absence of quantifiable data on the Full Self-Driving (FSD) improvements and strategic details regarding ride-sharing services. Analysts from Wells Fargo shared similar views, calling the event more style than substance.
Concerns were raised about potential stock declines as Barclays noted that investors might choose to sell based on this news. Jonas anticipated pressure on Tesla’s stock due to the minimal substance presented during the event.
While Piper Sandler analysts praised the excitement of the event, they suggested it wouldn’t significantly impact Tesla’s stock, noting a likelihood of disappointing reactions from trading-focused firms. They cautioned of a sell-off in the upcoming weeks as pre-event enthusiasm faded, but still recognized that dedicated Tesla investors could feel invigorated by the developments.
Following the event, Tesla’s stock dropped by 8% to 219.66 and fell below its 50-day moving average amidst heavy trading volume, signaling further caution among investors. In contrast, Uber Technologies saw a surge of 8.8%, crossing a key buy point.
During the event, Musk did not elaborate on crucial business models like the proposed ride-hailing service, and there was no mention of the “affordable” EV expected by mid-2025. He did suggest the Cybercab could be priced under $30,000, with production slated for “before 2027,” and reiterated hopes for achieving fully autonomous driving in California and Texas next year with the Model 3 and Model Y, though he acknowledged a tendency to underestimate timelines.
Musk also introduced a large Robovan, but provided no details on its production timeline. In addition, the latest version of the Optimus robot was showcased, with future production costs projected between $25,000 and $30,000.
Tesla is aiming to enhance sales and FSD uptake in the fourth quarter, recently allowing owners to transfer FSD to new Model 3, Y, S, or X vehicles until the end of the year, following a promotion for 0% financing on Model 3 and Y purchases including FSD.
As Tesla stock slid almost 1% on Thursday, it recorded a weekly decline of 4.5% leading into Friday’s action. Currently, Tesla’s stock holds a cup-with-handle buy point of 264.86, with earlier entry possibilities around the 250 mark. Concerns about third-quarter delivery figures also weighed on Tesla shares, with results expected to be released on October 23. Tesla currently ranks fourth in the IBD Auto Manufacturers industry group and has a Composite Rating of 61 out of 99.