Tesla will introduce the robotaxi this week after years of announcements and countless delays. There’s a lot of anticipation to see what the company’s self-driving car can do, until now Elon Musk’s eternal promise that never really saw the light of day. By targeting Thursday’s event, the company risks its rally and the relative calm that the stock market has enjoyed of late.
The automobile company will celebrate the ‘We, Robot’ event next Thursday, October 10 in the afternoon. Although it doesn’t give many details, the call explains that it will show the future of autonomous vehicles and that there will be a demonstration of driverless driving. Although the company’s CEO has been talking about robotaxi for years and has also been postponing its launch for years, it seems this time is the last.
The first part of 2024 has been eventful for Tesla. The company laid off 10% of its global workforce, electric car sales plummeted, and there was a lot of uncertainty around the company’s strategy. On the one hand, the company expected to launch an inexpensive vehicle model, with a price of around 25,000 euros, and on the other, the robot taxi was always on Musk’s lips. But neither thing ultimately happened.
During this period, the company lost 43% of its stock market value until annual lows marked in April at $142. Additionally, this decline caused Tesla to be excluded from Wall Street’s Magnificent Seven group, replaced by technology company Broadcom. But after hitting rock bottom, the American company began to recover, coinciding with the announcement of the arrival of the robotaxi in a few months. Since then, his rally It is 70% and its title, around 240 dollars, is close to the levels at which it started the year.
From now on, the continuation of profits will largely depend on the robotaxi and what Tesla shows on Thursday. The big difference of this project compared to current cars is that autonomous driving will not require any human intervention.
“After the continued delays, there are a lot of expectations (…). We are skeptical and do not think the October 10 event will satisfy the Tesla bulls. threshing After the event, this will pass and investors will need to focus on weakening fundamentals,” warn Wells Fargo. Their analysts explain that Tesla It’s way more overrated than the Magnificent Seven, which contrasts with its growth forecasts for the next three years, much lower than those of the other six in the group – to which it no longer belongs -.
Although the robotaxi has potential and could become one of the company’s major projects, What will mark its results will be vehicle deliveries in the next one to two years, according to Bloomberg Intelligence. It’s a bucket of cold water for bulls who anticipate the fully autonomous car revolution and wonder about the continuity of rally.
Recently, Tesla’s volatility has moderated, although this week the ups and downs are expected to shake up the company again, which is common before and after its events. Thursday’s presentation could move investors for a month, but should not have any long-term effect, according to the same analysts. What the market consensus estimates is that the automaker will lose 10% of its stock value over the next 12 months, to $216.5 per share. In other words, they don’t see potential.
One of the plans Musk has in mind with the robotaxi is for Tesla to have a bit of Airbnb and Uber. The businessman explained that he wanted to create a fleet of cars of his brand, with the possibility for owners to rent them by the hour or by the minute when they are not using them. Since the vehicle will drive itself, the CEO believes that this will allow you to expand the services offered by your models, beyond personal use.
Either way, the day after tomorrow will be a key day for Tesla and its price. Musk’s forever promise comes with sky-high expectations and a stock market rise that needs to be justified.
