Elon Musk’s claims surrounding Tesla (TSLA)’s ability to produce fully autonomous cars are often excessively ambitious—something the Tesla CEO himself admits. “Obviously, my predictions on this have been overly optimistic in the past,” he said during Tesla’s second-quarter earnings call yesterday (July 23). However, that didn’t stop Musk from proposing another optimistic proposal when asked about a timeline for the company’s robotaxis. Tesla’s unsupervised Full Self-Driving (FSD) vehicles could hit the road “possibly by the end of this year,” Musk said, adding, “I would be shocked if we cannot do it next year.”
In 2016, Musk suggested that fully autonomous Teslas would be available within the next two years. In 2019, he claimed that 1 million robotaxis would be on the road by 2020. And earlier this month, Musk delayed an event dedicated to unveiling Tesla’s robotaxi design that was supposed to take place on Aug. 8. The Tesla CEO confirmed during the earnings call that that event is now scheduled for Oct. 10.
Musk said the date was pushed back to allow Tesla to make some important changes to the robotaxi and “show off a couple of other things” during the event. The Tesla head has spent recent years pivoting his company towards a foundation built on A.I., lauding future products like the robotaxi as key to its success. “By far the biggest differentiator for Tesla is autonomy,” he said.
Tesla’s quarterly profit plummeted 45 percent
Musk’s attempts to refocus Tesla come as the automaker’s profits slip. Tesla reported $1.5 billion in net income for the second quarter, a 45 percent dip from a year ago. According to Tesla, this fall was partly influenced by operating expenses driven by A.I. projects and restructuring changes. Quarterly revenue rose 2 percent to $25.5 billion, driven partly by Tesla’s energy storage business growth, which saw its sales double from last year to $3 billion.
Tesla is battling competition globally as rivals like BYD become more dominant. “There have been quite a few competing electric vehicles that have entered the market,” Musk told analysts today, adding that “we don’t see this as a long-term issue, but really as fairly short-term.” The increasingly crowded EV landscape caused Tesla to slash prices across several vehicle models earlier this year.
Tesla will need to quickly show results for the innovative proposals put forward by Musk, which include the company’s robotaxi goals and plans to sell humanoid robots, “as we shift towards a faster-growth environment in the second half of the year, where competition will keep on bridging a progressively smaller technological gap between EV peers,” said Investing.com analyst Thomas Monteiro in an investor note. “Perhaps more than ever in the company’s recent history, Tesla’s investors need results; those will have to come fast.”
Dojo supercomputer is suddenly a top priority.
Musk’s ambitious vision for Tesla’s future also includes Dojo, a supercomputer that will aid in A.I. training to improve the company’s FSD software. In January, he called the project as a “long shot” and “not something that is a high probability.”
The Tesla head took a different approach yesterday, describing Dojo as a top priority for the company in light of heightened demand for Nvidia (NVDA)’s graphics processing units (GPUs), which are in short supply as tech companies order mass amounts to help train and deploy A.I. models. “I’m quite concerned about actually being able to get Nvidia GPUs when we want them,” said Musk.
In response, Tesla must put more effort into ensuring Dojo can provide the training capabilities needed for its FSD goals. “We are going to double down on Dojo, and we do see a path to being competitive with Nvidia with Dojo,” said Musk. “We’ve really got to make Dojo work.”