Benzinga - by Shanthi Rexaline, Benzinga Editor.
Tesla, Inc. (NASDAQ:TSLA) faced selling pressure on Friday following a Reuters report suggesting plans to scrap its sub-$30,000 car. However, CEO Elon Musk promptly denied the report, while a notable figure at the company delivered a cryptic response.
What Happened: During a panel discussion at the Petersen Auto Museum, Tesla Chief Designer Franz von Holzhausen addressed queries about the proposed low-end EV.
When asked if the project had been abandoned or deprioritized, von Holzhausen intriguingly remarked, “I would just say stay tuned. Don't always believe what you read.”
The exchange was captured in a video clip shared by a user on the X platform.
Franz @woodhaus2 on the new rumored $25,000 future Tesla pic.twitter.com/eAK7u3wxUI— Zack (@BLKMDL3) April 7, 2024
Amidst the buzz, Musk announced on Friday that the unveiling of Tesla’s Robotaxi is slated for Aug. 8.
Tesla Robotaxi unveil on 8/8— Elon Musk (@elonmusk) April 5, 2024
Why It’s Important: Analysts expressed mixed sentiments about the rumored abandonment of the low-end car.
Future Fund's Gary Black, who has been very vocal about the need for a low-end EV, said shelving the low-end platform and doubling down on the full self-driving (FSD) software would be “very risky and institutions would dump the stock since there would be little growth and high pricing risk until the robotaxi materialized — or not.”
But Deepwater Asset Management's Gene Munster said this was the right move for Tesla. “Being the first to do full autonomy at scale is [a] huge first mover advantage. While the event is in August, my guess is we see Robotaxi's on the road in 2027,” he said.
Commenting on von Holzhausen’s statement, Troy Teslike, who is widely known for his Tesla estimates, said Tesla could unveil two identical-looking vehicles on Aug. 8 — a robotaxi without a steering wheel and pedals, and a compact car. “They might say production starts now for the Robotaxi version but later for the compact car version,” he said.
However, the success of Robotaxi development and deployment hinges on various factors, including perfecting full self-driving technology, achieving higher levels of autonomy, and obtaining regulatory approval. Notably, General Motors Corp.’s Cruise suspended its robotaxi operations in the U.S. in October following an incident in San Francisco.
In a separate post, Teslike proposed that Tesla is likely prioritizing Robotaxi development until Giga Mexico is operational. Both the Robotaxi and the Model 2 are expected to be built on the same platform, with the first production line anticipated at Giga Texas.
Price Action: Tesla closed Friday’s session down 3.63% at $164.90, marking a year-to-date loss of approximately 34%.
Read Next: How Many Tesla Cars Are Deployed With FSD In America? AI Head Reveals Latest Numbers
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