'Autonomy is the story,' Musk says, but Tesla's autopilot production 'several months behind'
After reporting second quarter results that were not as bad as Wall Street feared, Tesla executives, including CEO Elon Musk and CFO Vaibhav Taneja assured investors that the company has ambitious plans for its robotaxi service, full self-driving (FSD), and plans for a more affordable electric vehicle, despite regulatory headwinds, production challenges, and negative impacts from both tariffs and provisions within the “Big Beautiful Bill” that was recently passed into law.
Because of the company’s focus on the robotaxi rollout in Austin last month, production release of autopilot is “several months behind,” Musk said on the company’s earnings call, but remains a “huge selling point” that will drive sales in Europe once autonomous driving is comparable to the U.S.
“We’ll get the [regulatory] approvals in Europe,” Musk assured, and hope to unblock regulatory “challenges” in China soon.
“Autonomy is the story,” Musk said, “And once you have the physical product, the autonomy is what amplifies the value to stratospheric levels.”
Following the launch in Austin, Tesla (NASDAQ:TSLA) is also seeking regulatory approval for robotaxis in the San Francisco Bay Area, Nevada, and Florida (a remark that briefly launched shares higher) with Musk predicting that robotaxis will be available to “half the U.S. population by the end of this year.”
Tesla’s (NASDAQ:TSLA) goal of a more affordable EV will be achieved later this year as the company seeks to maximize production by the third quarter for delivery in Q4. Losing EV incentives could result in “a few rough quarters” Musk said, but the goal of the company remains to make the most affordable car it can.
Optimus 3 is an “exquisite design” and will be the biggest product ever, Musk predicts. But while Optimus remains a “hard product to design,” production is expected to start at the beginning of next year, and scale production by five years.
“I would be surprised if we’re not making 100K [Optimus robots] by 60 months,” said Musk.
On the topic of U.S. policies, including tariffs, CFO Taneja estimates this will cost the company $300M in FY25, in addition to near-term challenges to the business as a result of the new spending bill that removed EV tax credits effective September 30.
However, Taneja is confident that the company’s investment in AI and robotics “sets Tesla up for a bright future.”
By the end of the call, Tesla (NASDAQ:TSLA) shares were nearly 3% lower, suggesting Musk and Co failed to convince investors the company will achieve its ambitious goal to pivot to a profitable robotics company in the near future.
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