Tesla Robotaxi Event: Market Reaction Negative Despite Rise in Deliveries

Key Takeaways

• Tesla’s robotaxi event on Thursday failed to impress investors.
• Elon Musk said he expects production to start “before 2027.”
• But analysts have expressed skepticism that the company can deliver the ambitious platform on time.

Investors expressed disappointment after Thursday’s robotaxi event as Elon Musk failed to convince them that the company had a feasible go-to-market plan for the ambitious platform. 

Shares remained flat in post-market trading, despite Tesla recently reporting a rise in deliveries—news that usually buoys the company’s stock price.

Investors Disappointed by Robotaxi Timeline

Although Musk said he expects the first two-door driverless “cybercabs” to be produced “before 2027,” considering the Tesla CEO’s long history of promising fully driverless vehicles are just around the corner, analysts weren’t convinced.

With Waymo in the middle of its own geographic expansion and Cruise preparing to relaunch next year, Tesla is under pressure to move quickly. Meanwhile, the rising threat from startups like Wayve, which recently partnered with Uber to accelerate the ride-hailing service’s integration of self-driving technology, could further increase competition in the sector in the coming years.

In the runup to the event, many Tesla watchers had hoped the company would announce a Wayve-style robotaxi platform that could start generating revenue in 2025. 

Instead, they got a flashy technology demonstration and a vague timeline for yet another ambitious vision of the future from a company with a poor record of sticking to deadlines.

“I’m a shareholder and pretty disappointed. I think the market wanted more definitive timelines,” commented  equity trader Dennis Dick at Triple D Trading. “I don’t think he said much about anything.”

No Answer to Regulatory Concerns

Probably the biggest factor weighing on Musk’s vision for the future of autonomous driving is the slow pace of regulatory uptake. 

Current market leader Waymo has made important inroads in California and Arizona. But its driverless rides still have steering wheels and can be operated by humans if needed. Tesla’s proposed robotaxi doesn’t. 

This begs the question of what happens in the event of an incident like the one that recently held up Kamala Harris’s motorcade in Los Angeles last month. After a rogue Waymo got stuck doing a U-turn in the middle of the street, a local police officer had to get in and move it. This fallback has been essential to Waymo’s success and is a big part of why city administrators have let its cars on the road.

Given the general direction of vehicular autonomy, fully driverless cars with no need for steering wheels are on the horizon. But Musk has been wrong about how soon they would arrive in the past. When most cities are still only piloting Waymo-style driverless platforms, will the world really be ready to entrust driving entirely to AI by 2027?

Tesla Stock Down Despite Rise in Deliveries

In the past week, Tesla’s share price has fallen 3.2%, despite the company recently posting its first quarterly rise in deliveries this year.

In the three months to Sept. 30, Tesla delivered  462,890 vehicles, marking a 6.4% year-over-year increase and a 4.2% rise from the previous quarter. 

There had been some hope that Thursday’s robotaxi event would boost the stock. But in overnight trading, TSLA remained flat. And with investors expressing frustration about the lack of a clear path toward robotaxi revenues, there was a similarly muted reaction when markets opened on Friday.