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· Posted on
October 14, 2024

Elon Musk’s new self-driving car prototype is too little too late for investors

Tesla finally revealed a prototype of the self-driving Cybercab, which will be self-driving Tesla taxis that passengers can hail through an app.

What's the key learning?

  • Musk has been known to make bold statements and "projects" which include his plans to colonise Mars, flying cars, and invention of humanoid robots.
  • Although he made these outrageous announcements, many of these were undelivered and past his target deadline.
  • This possibly caused for the investors to get weary about Musk, which brought down Tesla's share price.

👉 Background: In 2016, Elon Musk promised the release of self-driving cars in the next two years. Then in 2019, he predicted Tesla would produce operational robotaxis by 2020. It’s 2024 and we self-driving cars are still in their infancy.

👉 What happened: Last last week, Tesla finally revealed a prototype of the self-driving Cybercab, which will be self-driving Tesla taxis that passengers can hail through an app. Musk also unveiled prototypes of the Robovan that can carry 20 people.

👉 What else: But given all the misses in the past, all these reveals were taken with a grain of salt. And Tesla's share price actually declined on the news.

What's the key learning?

💡When promises no longer excite, results are the only thing that matter.

💡Investors have grown wary of companies making grand announcements without backing them up with tangible outcomes. In fact, Elon Musk has incorrectly predicted the release of his self-driving cars seven times.

💡Over-promising and under-delivering leads to scepticism, and once investors lose confidence, even the most exciting news can fail to boost a company’s stock price. In Tesla's case, its share price dropped by ~1% after the news.

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