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Tesla earnings week spotlights price cuts, Elon's 'balls to the wall' autonomy push | TechCrunch

As Tesla gears up to report what will likely be unimpressive financial results for the first quarter on Tuesday, the company is making more moves to go “balls to the wall for autonomy,” as CEO Elon Musk put it last week in a post on X

Over the weekend, Tesla dropped the price of its Full Self-Driving (FSD) advanced driver assistance system to $8,000, down from $12,000. That price cut is in addition to last week’s drop of the FSD monthly subscription to $99, from $199. The push to get FSD into more cars could be a bid to collect more data as Tesla works to boost the neural networks that will power fuller-scale autonomy. FSD today can perform many driving tasks in cities and on highways, but still requires a human to remain alert with their hands on the wheel in case the system requires a takeover. 

Tesla faces narrowing profits as it places a major and expensive bet on autonomous driving technology. Last week, Tesla laid off 10% of its staff in a move to reduce costs in preparation for the company’s “next growth phase,” per an email Musk sent to all employees. 

Earlier this month, Musk abruptly announced on X that Tesla was pausing the development of its $25,000 electric vehicle in favor of a robotaxi that he promised to reveal in August. Sources within Tesla have confirmed to TechCrunch that they didn’t have prior warning from Musk on this sudden shift, and that internal restructurings reflect a new ethos that puts robotaxi development at front and center. 

All of this is happening as Tesla zigzags on its EV pricing strategy. 

Last week, Tesla ditched EV inventory price discounts, but over the weekend slashed prices on Model 3 and Model Ys by as much as $2,000 in the U.S., China and Germany. As we saw during the first quarter of 2023, those price cuts are taking their toll on Tesla’s income and margins

Tesla is scheduled to report earnings after markets close April 23. Musk has previously said that without autonomy, Tesla is “basically worth zero.” 

The company will need to convince investors tomorrow that its shift in priority to autonomous vehicles is a silver lining in the cloud of declining margins, rather than just smoke and mirrors. 

Since Musk laid off staff and announced that Tesla would be going hard on autonomy, Tesla’s share price has dropped almost 10%. Shares have fallen over 42% since the start of the year.

What to expect at Tesla’s Q1 2024 earnings

Tesla’s lower first-quarter delivery figures combined with price cuts are ingredients for a smaller profit pie. And analysts seem to agree. 

Analysts polled by Yahoo Finance expect a profit of $0.48 per share on 20.94 billion in revenue. As a reminder, Tesla generated $25.17 billion revenue in Q4 and $23.3 billion in the first quarter of 2023. 

Tesla delivered 386,810 vehicles in the first quarter of 2024, down 20% from the 484,507 it delivered in the final quarter of 2023. It’s worth noting that this wasn’t just a quarter over quarter blip. Tesla delivered fewer cars than the first quarter of 2023 — the first year-over-year drop in sales in three years.

Tesla’s Q4 results showed a company already grappling with shrinking profit margins due to its price cutting strategy, rising costs of its Cybertruck production launch and other R&D expenses. 

The automaker reported net income, on a GAAP basis, of $7.9 billion in the fourth quarter — an outsized number caused by a one-time non-cash tax benefit of $5.9 billion. The company’s operating income and its earnings on an adjusted basis provided a clearer picture of its financial performance.

Tesla reported operating income of $2.06 billion in the fourth quarter, a 47% decrease from the same year-ago period. On an adjusted basis, the company earned $3.9 billion, a 27% drop from the same period last year.

The question is whether Tesla can prevent that profit pie from shrinking to profit muffin. 

Since Tesla reported its Q1 2024 production and delivery numbers, the company has continued to pull various financial levers aimed at attracting new buyers and inducing existing customers to pay for FSD — all while reducing costs and maintaining profit margins. 

Those opposing goals coupled with Musk’s “wartime CEO mode” status are bound to make the Q1 earnings call entertaining. Beyond that potential theater, there are pressing long-term questions about how Tesla delivers on autonomy and if it will be enough to convince investors that it can still lead and innovate. 

Software Development in Sri Lanka

Robotic Automations

Watch: Tesla's Cybertruck recall, layoffs set the stage for its Q1 earnings | TechCrunch

Tesla is not having a good start to the week. In its defense, it didn’t have a very good end to last week, either.

Today the news is that recent price cuts have irked Tesla investors, who sent its shares off around 4% in early trading today. Those losses have extended Tesla’s total share-price declines to around 43% for the year. Which is, as they say, a lot.

But those price cuts are hardly the only issues needling the U.S.-based EV company. Tesla’s last week saw the company slash its staffing, including high-performers. With the company reporting earnings tomorrow, its actions at the moment are under even greater scrutiny than usual.

The backdrop to all of this is the company’s apparent move away from a basement-priced EV, and towards a robotaxi effort that some consider to be technologically premature. Regardless, Tesla’s price cuts, pivots, and mass-recall of its Cybertruck vehicle are not the recipe for content investors. Hit play, and let’s have some fun.

After we recorded this clip, Bloomberg posted a fascinating dig into the company’s current form that we recommend as further reading.

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Robotic Automations

Tesla layoffs, Cybertruck recalls and Serve Robotics goes public | TechCrunch

Welcome back to TechCrunch Mobility — your central hub for news and insights on the future of transportation. Sign up here — just click TechCrunch Mobility — to receive the newsletter every weekend in your inbox. Subscribe for free.

Tesla is back in the news cycle and our crystal ball says it’s one of those long-term affairs. The week kicked off with layoffs — about 10% of its more than 140,000-person workforce — and CEO Elon Musk declaring he was going “balls to the wall” on autonomy. It ended with a Cybertruck recall. Cool cool.

There’s lots more in the newsletter than just Tesla — although before we move on, do check out Sean O’Kane’s scoop about the company’s 1,800-mile Tesla Semi charging corridor program. Read on to catch up on Serve Robotics’ public market debut, a week of highs and lows for Waymo, and more.

Let’s go! 

A little bird

While much of our focus is on startups and Silicon Valley, we do have some little birds in Washington, D.C.

A little bird told us recently that federal regulators are getting close to publishing a Notice of Proposed Rulemaking on autonomous vehicle regulations, which would be the first set of federal guardrails proposed for the industry.

Our source said the Federal Motor Carrier Safety Administration (FMCSA), which regulates commercial vehicles in the U.S., should have a proposal out by this summer, fall at the latest. We’re told that the federal ruling on AVs will likely establish a minimum safety standard for AVs to operate on public roads but that state governments could enforce stricter regulations within their own borders. We’ve been hearing about discussions and plans around federal AV regulations for years now. Have we finally started to make headway? We shall see. 

Got a tip for us? Email Kirsten Korosec at [email protected], Sean O’Kane at [email protected] or Rebecca Bellan at [email protected]. If you prefer to remain anonymousclick here to contact us, which includes SecureDrop (instructions here) and various encrypted messaging apps.

Deal of the week

Serve Robotics, the Nvidia- and Uber-backed sidewalk robot delivery company, hit the public markets this week via a reverse merger. Serve expects its public debut to bring in around $40 million in gross proceeds, funding that will go toward R&D for future robots, manufacturing of new robots, geographic expansion and more.

Serve’s goal is to increase its fleet from the 100 robots deployed today around Los Angeles to 2,000 robots across multiple U.S. cities by the end of 2025, via a partnership with Uber Eats. Serve has huge revenue ambitions, with plans to generate between $60 million and $80 million in annual revenue by that same deadline. In 2023, Serve brought in $207,545 in revenue at a loss of $1.5 million.

FWIW, Uber and Nvidia are still shareholders, but their shares in the company are decreasing with this debut. Pre-IPO, Uber and Nvidia held a 16.6% stake and 14.3% stake, respectively. Once the offering closes, those stakes will change to 11.5% and 10.1%, per regulatory filings.

Serve’s share price was $4 at market open on Thursday, and it closed that day at around $3.

Other deals that got my attention …

Found Energy, a startup that uses waste aluminum to generate heat and hydrogen, raised a $12 million seed round, but Tim De Chant’s story on the company is about so much more.

Getir, a Turkish delivery company that was once worth $12 billion, is reportedly weighing asset sales and exits from non-core markets as investors put the pressure on to cut losses.

Swtch Energy, a company building EV charging solutions for apartment buildings, raised $27.2 million in a Series B to expand its charging network and boost the tech behind its charging and energy management solutions. Blue Earth Capital led the round with participation from Alantra’s Energy Transition Fund Klima, Active Impact Investments and GIGA Investments Corp.

Notable reads and other tidbits


Mobileye has secured orders to ship 46 million of its EyeQ6 Light ADAS chips over the next few years to automakers. Multiple models launching this year will feature the chip, which promises to deliver improved sensing of wet roads, detection of and reaction to objects at a greater distance, and better ability to read key text phrases on road signs. TechCrunch had the chance to dig into this, and our main takeaways are that automakers will probably love this chip because it’s more powerful than Mobileye’s last chip, but it’s the same price.

Autonomous vehicles

Waymo has begun initial data collection and mapping in Atlanta, the company’s latest geographic win. The Alphabet-owned company didn’t say whether it plans to launch in the Georgian city or any other city it is mapping in, such as Washington, D.C., and Buffalo. Aside from San Francisco, Waymo has launched commercial robotaxi services in Los Angeles and Phoenix, with Austin planned for the end of this year.

But with ups, come downs. Six Waymo vehicles also got caught blocking traffic to an on-ramp in San Francisco. The vehicles were caught between a construction zone and the on-ramp and had to pull over to await rescue. A spokesperson told TechCrunch that while Waymo does have the green light to go fully driverless on freeways in San Francisco, the company has not yet pulled the driver out.

Electric vehicles, charging & batteries

General Motors launched a home EV charger and vehicle-to-home (V2H) kit that lets a home pull energy from an EV battery in the event of a blackout. Customers in California, Florida, Texas, Michigan and New York can purchase today.

Gogoro, the two-wheeler battery-swapping company, and TSMC, a global semiconductor company, are partnering to introduce 15 GoStations across Taiwan that use 100% clean energy. They’ll also be launching Gogoro’s scooter-sharing service in TSMC’s headquarter city, Hsinchu, and expanding the charging network in the city.


We’ve been all over Tesla this week, so let’s dive in.

The week started out with company-wide layoffs that affected at least 10% of the entire 140,000-person organization, with some teams seeing 20% of their staff gutted. Two high-profile executives departed Tesla as well: Drew Baglino, Tesla’s SVP of Powertrain and Energy, and Rohan Patel, VP of Public Policy and Business Development. Patel told TechCrunch he left because of “[b]ig overall changes” at the company that he declined to specify. In an email sent to the company, CEO Elon Musk said the cuts were necessary to increase productivity and prepare for Tesla’s “next phase of growth.”

(Psssst! Don’t want to read about Tesla layoffs and what comes next? You can watch about it instead.)

Many of those who were cut, sources say, were high performers who just happened to be working on lower-priority projects. Sources at Tesla also told TechCrunch the company made the cuts because it expects poor first-quarter earnings. Deliveries were subpar, and all those price cuts last year that continued early into 2024 likely had an effect on Tesla’s margins. Deliveries were down in Q1 year-over-year, despite the $200,000 Tesla spent on advertising on X, per our reporting.

Which might be why Tesla ditched its EV inventory price discounts this week. On X, Musk said this move was in line with Tesla’s strategy to “streamline the whole Tesla sales and delivery system.”

These changes in general, and the layoffs in particular, are made more stark by Tesla’s proxy statement that calls on the board to reinstate Musk’s $56 billion payout, which a Delaware judge earlier this year voided. In a huff, Musk threatened to reincorporate Tesla in Texas instead, and it appears that plan will also be put to the board soon.

Meanwhile, on the charging front, Tesla is moving forward with its plan to build an electric big rig charging corridor stretching from Texas to California, despite being snubbed by a lucrative federal funding program that’s part of Biden’s Bipartisan Infrastructure law.

Tesla this week also had to recall the 3,878 Cybertrucks that it has delivered to customers to date over faulty accelerator pedals that can get stuck. I know what you’re thinking. Finally we know how many Cybertrucks Tesla delivered.

This week’s wheels

I’ve been in a handful of new vehicles and I’m eager to share my thoughts, but we’re also running out of space this week. In the coming issues, we’ll have some takes on electric bikes, the 2024 Lexus LC 500h, the 2024 Mercedes-Benz eSprinter and more.

See y’all next week!

Software Development in Sri Lanka

Robotic Automations

Boston Dynamics unveils a new robot, controversy over MKBHD, and layoffs at Tesla | TechCrunch

Welcome, folks, to Week in Review (WiR), TechCrunch’s weekly news recap. The weather’s getting hotter — but not quite as hot as the generative AI space, which saw a slew of new models released this week, including Meta’s Llama 3.

In other AI news, Hyundai-owned robotics company Boston Dynamics unveiled an electric-powered humanoid follow-up to its long-running Atlas robot, which it recently retired. As Brian writes, the new robot — also called Atlas — has a kinder, gentler design than both the original Atlas and more contemporary robots like the Figure 01 and Tesla Optimus.

Turning our attention to YouTube for a moment, Dom and Amanda wrote about how Marques Brownlee (MKBHD), the famed gadget reviewer, shouldn’t be blamed for the fate of AI startup Humane AI, whose product, the Ai Pin, Brownlee gave a scathing review of earlier this week. They point out that Humane is a well-funded company with plenty of funds in the bank to burn, and find that critics of Brownlee — who accuse him of being unfairly harsh — have misplaced their rage.

And Rebecca and Sean report on layoffs at Tesla, which they say hit high performers and gutted some departments. The cuts were largely due to poor financial performance; Tesla’s seen its profit margin narrow over the past several quarters as the EV price war persists.

Lots else happened. We recap it all in this edition of WiR — but first, a reminder to sign up to receive the WiR newsletter in your inbox every Saturday.


X charges for posting: X CEO Elon Musk is planning to charge new X users a small fee to enable posting on the social network in an effort to curb what he describes as a “bot problem.”

Change ransomware: An extortion group has published a portion of what it claims are the private and sensitive patient records on millions of Americans stolen during the ransomware attack on Change Healthcare in February.

Tesla adjusts prices: In more Tesla news, the automaker ditched EV inventory price discounts in what CEO Elon Musk characterized as a move to “streamline” sales and delivery. Tesla also dropped the price of its advanced driver assistance package, Full Self-Driving, to $99 per month in the U.S.

Mars free-for-all: Devin reports that space startups are licking their lips over NASA’s decision to convert its $11 billion, 15-year mission to collect and return samples from Mars into essentially a commercial free-for-all.

Waymo problems: Six Waymo robotaxis blocked traffic moving onto an on-ramp in San Francisco on Tuesday. It’s not the first time Waymo vehicles have caused a road blockage, notes Rebecca — but this is the first documented incident involving a freeway.


Google Cloud bets on generative AI: Ron writes about how Google Cloud is investing heavily in generative AI, as evidenced by the string of announcements during Google’s Cloud Next conference earlier in the month.

Generative AI in health: Generative AI is coming for healthcare — but not everyone’s thrilled. Some experts don’t think the tech is ready for prime time.

Airchat, for talking: Anthony breaks down the hype over Airchat, an app launched by former AngelList founder Naval Ravikant and ex-Tinder product exec Brian Norgard that focuses on voice, not text.

Software Development in Sri Lanka

Robotic Automations

Equities platform Midas raises $45M Series A as fintech retains its sparkle in Turkey | TechCrunch

Midas, a fintech startup that allows people in Turkey to invest in U.S. and Turkish equities, says it has raised $45 million in a funding round led by Portage Ventures of Canada.

The startup is aimed at Turkey’s retail investor market and claims to have more than 2 million users. Its pitch is that it charges significantly lower transaction and commission fees for Turkish customers who want to invest in U.S. or Turkish stocks. It also offers financial content, real-time stock market data and news, and company profiles — all to educate what many consider to be somewhat of an emerging market.

“If you came to Turkey three years ago, there were only 1.5 million investors. That’s in a country of 80 million,” Egem Eraslan, CEO and founder of Midas, told TechCrunch. “Capital markets penetration rates were very, very low. Mobile banking in Turkey is very good and widespread, but there was a lack of investment in equities products because of a lack of infrastructure.”

According to Eraslan, Midas managed to change that dynamic by building its own infrastructure and providing a decent user experience. “We were extremely capital-efficient. We built much of the initial infrastructure product and licensing with less than $500,000, and that allowed us to launch, get traction, raise capital and break that deadlock. We might be the only new broker in the world that launched self-clearing, self-custody, and self-execution.”

Midas is not dissimilar to U.S.-based Robinhood, which has become a giant in the space by providing retail investors an easy avenue to investing in the financial markets. But Eraslan explains that his company has had take a different tack in Turkey.

“We had to launch multiple products with our own self-clearing, custody, and with the entire value chain. If you’re Robinhood, you don’t have to do self-custody or self-clearing.”

Midas now plans to use the new funding to roll out three new products: cryptocurrency trading, mutual funds, and savings accounts. The company has plans to expand beyond Turkey, and aims to target countries in the MENA region.

International Finance Corporation, Spark Capital, Earlybird Digital East Fund, and Revo Capital also participated in the round. The company last raised an $11 million seed round in 2022. Arriving within three years of its founding, Midas’ latest fundraise is one of the largest by a Turkish fintech in recent years, close behind embedded finance startup Param, which raised $50 million in 2022.

Cem Sertoglu, managing partner of Earlybird Digital East Fund, of the startup’s early investors said, “Having timed the explosion in demand in the Turkish investment market perfectly as the first digital-native investment platform, Midas has been executing flawlessly. Winning the domestic market in the world’s 11th-largest economy will already be a success for Midas, but its ambitions lie further than that.”

In a statement, Paul Desmarais III, co-Founder of Portage, and CEO and chairman of Sagard, said: “Midas is leading a wave of transformation within Turkey’s financial landscape. Globally, Portage invests in transformational financial technology and Midas is poised to lead that initiative in a region of early adopters.”

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Robotic Automations

Tesla's newsy week, and is fintech having a moment? | TechCrunch

It’s been more than a minute since Tesla went public, but the EV company was inescapable on TechCrunch this week. From layoffs to pricing changes and more, it was a week dyed deeply in Tesla colors so we had to chat through the latest.

But that was just one element of what we got into on Equity this week. We also dug into Mary Ann’s reporting about Ramp’s latest round — and up valuation — that fit neatly next to Rippling’s own impending fundraise. If you are handling money, it’s a good time to be a startup.

The team also dug into Cherub, which wants to connect investors and founders, Maven Ventures’ consumer investing push, and touched on what Mercury is up to. All told, we were fortunate to have Kirsten Korosec along with us this week given the sheer volume, and diversity of transportation news to chew through, especially as it relates to Tesla.

Equity is back tomorrow with a special interview between Mary Ann and Notable Capital’s Hans Tung, so stay tuned! Until then, hit play and let’s have some fun.

Equity is TechCrunch’s flagship podcast and posts every Monday, Wednesday and Friday. You can subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

You also can follow Equity on X and Threads, at @EquityPod.

For the full interview transcript, for those who prefer reading over listening, read on, or check out our full archive of episodes over at Simplecast.

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Robotic Automations

Tesla recalls the Cybertruck for faulty accelerator pedals that can get stuck | TechCrunch

Tesla has issued a recall for the Cybertruck due to a problem where the accelerator pedal can get stuck, putting drivers at risk of a crash, according to the National Highway Traffic Safety Administration.

The recall caps a tumultuous week for Tesla. The company laid off more than 10% of its workforce on Monday, and lost two of its highest-ranking executives. A few days later, Tesla asked shareholders to re-vote on CEO Elon Musk’s massive compensation package that was struck down by a judge earlier this year.

Reports of problems with the Cybertruck’s accelerator pedal started popping up in the last few weeks. Tesla even reportedly paused deliveries of the truck while it sorted out the issue. Musk said in a post on X that Tesla was “being very cautious” and the company reported to NHTSA that it was not aware of any crashes or injuries related to the problem.

The company has now confirmed to NHTSA that the pedal can dislodge, making it possible for it to slide up and get caught in the trim around the footwell.

Tesla said it first received a notice of one of these accelerator pedal incidents from a customer on March 31, and then a second one on April 3. After performing a series of tests, it decided on April 12 to issue a recall after determining that an “[a]n unapproved change introduced lubricant (soap) to aid in the component assembly of the pad onto the accelerator pedal,” and that “[r]esidual lubricant reduced the retention of the pad to the pedal.”

Tesla says it will replace or rework the accelerator pedal on all existing Cybertrucks — which, according to the documents, it has shipped 3,878 to date. It also told NHTSA that it has started building Cybertrucks with a new accelerator pedal, and that it’s fixing the vehicles that are in transit or sitting at delivery centers.

While the Cybertruck only first started shipping late last year, this is not the vehicle’s first recall. But the initial one was minor: Earlier this year, Tesla recalled the software on all of its vehicles because the font sizes of its warning lights were too small.

Software Development in Sri Lanka

Robotic Automations

Tesla Semi charging corridor project is still alive despite Biden admin funding snub | TechCrunch

Tesla is pushing forward with a plan to build an electric big rig charging corridor stretching from Texas to California, despite being snubbed by a lucrative federal funding program that’s part of Biden’s Bipartisan Infrastructure Law. But the original scope of the project could still change, TechCrunch has learned.

The company had been seeking nearly $100 million from the Charging and Fueling Infrastructure (CFI) Discretionary Grant program under the Federal Highway Administration (FHWA). Combined with around $24 million of its own money, Tesla wanted to build nine electric semi-truck charging stations between Laredo, Texas and Fremont, California.

The corridor, if built, would be a first-of-its-kind charging network that could enable both long-distance and regional electric trucking and help clean up a big chunk of the otherwise dirty transportation sector. Without it, though, Tesla’s promise to electrify heavy-duty trucking could fall even farther behind schedule than it already is.

The project as pitched to the FHWA was called TESSERACT, which stands for “Transport Electrification Supporting Semis Operating in Arizona, California, and Texas,” according to a slide buried in a 964-page filing with the South Coast Air Quality Management District. (Tesla collaborated with SCAQMD on the application.)

But Tesla was not among the 47 recipients that the Biden administration announced in January. Collectively, those winners received $623 million to build electric vehicle charging and refueling stations across the country. This is despite Tesla winning around 13% of all other charging awards so far from the Infrastructure Act, though that has only netted the company around $17 million.

Rohan Patel, who left his VP position at Tesla this week as the company laid off 10% of its workforce, said in a message to TechCrunch that Tesla may turn to state funding opportunities, or future rounds of the CFI program. Some of the sites along the route “are no-brainers even without funding,” he said.

Image Credits: TechCrunch

The 1,800-mile route would theoretically connect Tesla’s two North American vehicle factories, as well as one that is planned — but delayed — in Mexico. Each station was originally slated to be equipped with eight 750kW chargers for Tesla Semis, and four chargers open to other electric trucks. It’s unclear how effective it would be if the company was unable to build all nine stations, which are situated at roughly equal distances along the route.

About half of the Biden administration’s choices for the CFI funding focused on building out EV charging infrastructure in “urban and rural communities, including at convenient and high-use locations like schools, parks, libraries, multi-family housing, and more.”

The other half was dedicated to funding 11 “corridor” projects, including a number on the same I-10 corridor that makes up part of Tesla’s proposed route. That includes $70 million to the North Texas Council of Governments to build up to five hydrogen fueling stations for medium and heavy-duty trucks in the Dallas, Houston, Austin, and San Antonio areas.

“The project will help create a hydrogen corridor from southern California to Texas,” the Department of Transportation wrote in a statement in January.

“Funding hydrogen stations will go down as purely wasted money,” Patel told TechCrunch this week.

While he no longer speaks on behalf of Tesla, he also criticized funding hydrogen infrastructure when he was still with the company.

“Governments around the globe are wasting tax dollars on hydrogen for light/heavy duty infrastructure,” he wrote on X in February. “Like smoking, it’s never too late to quit.”

Funding isn’t the only challenge to the project. Another complicating factor could be Tesla’s recent restructuring.

Tesla CEO Elon Musk has said the company is now “balls to the wall for autonomy,” and has reportedly already sacrificed a planned low-cost EV in favor of making a purpose-built robotaxi the company’s priority. The Semi is years behind schedule, and Tesla has only built around 100 to date.

Despite all this, the Tesla Semi program is still slowly attracting customers. Just a few days after the restructuring, the head of the Semi program Dan Priestly announced via social media a new potential customer for the trucks. Priestly also said in March that Tesla has been using Semis to ship battery packs from Nevada to the Fremont factory.

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Robotic Automations

Tesla risks losing its lead without an inexpensive EV | TechCrunch

Elon Musk’s decision to green-light a robotaxi over an affordable EV might cost the company its lead.

Last week, Musk reportedly canned the effort in favor of a robotaxi, the sort of pie-in-the-sky project that defined his first decade at the helm. There’s an argument to be made that the company is where it is today by betting big, then delivering on enough of its promises to impress shareholders and generate significant positive cashflow. Problem is, in the early days, there was both everything and nothing to lose. The whole company could have gone under, but there was also less on the line.

Today, Tesla is no longer the plucky upstart. It brought in nearly $100 billion in revenue last year and earned net profits of $15 billion, the sort that would have other automakers rewarding shareholders with richer dividends. It’s a global manufacturer that cranks out hundreds of thousands of cars every quarter, the type of operation where success is measured in continuous improvement in productivity and process indicators.

Tesla was reportedly on the cusp of building a $25,000 EV. In January, Musk confirmed that the company would begin construction of a next-generation vehicle at its Texas plant in the second half of 2025. Suppliers had been asked to bid on parts contracts, Reuters reported, with weekly production volume starting at 10,000 vehicles per week. Given flagging sales of the company’s existing product line, it would have been a welcome shot in the arm.

An inexpensive EV would have significantly increased Tesla’s total addressable market by dramatically undercutting the average sales price in the U.S., which is currently at around $47,000. It also would have given the company a product to hold its ground against a predicted onslaught of inexpensive Chinese EVs.

But it also would have meant creating a production line from scratch, something the company last did at scale with the Model 3. By all accounts, that wasn’t a fun experience.

Building a robotaxi, though. Now, that sounds like fun.

Musk has long been enamored with the concept. Four years ago, he said that such a car would be able to earn its owner up to $30,000 per year as it ferried paying passengers to and fro. It would be so popular, Musk reportedly told biographer Walter Isaacson, that “there is no amount that we could possibly build that will be enough.”

Problem is, Tesla has been trying to master autonomous hardware and software for a while now, and it doesn’t appear anywhere close to delivering a vehicle capable of Level 5 driving, which would require zero human input. Despite years of work, Autopilot remains a Level 2 system, which means it requires human attention at all times. The same is true for Full Self-Driving. (Indeed, the company recently started using the term “supervised” when referring to the software suite.) And while artificial intelligence has been advancing rapidly of late, is it moving quickly enough to provide Tesla with a blockbuster product in the next few years?

Given Musk’s desire to pursue exploratory projects, the logical path would be to spin up a skunkworks inside Tesla or spin out a division that’s purely focused on bringing a robotaxi to market. The latter is unlikely to happen because much of Musk’s wealth is tied up in Tesla stock, and he probably doesn’t trust anyone else to run the company when that much money is on the line. The former has more of a chance, but Musk also likes to appear heavily involved in, well, everything at Tesla. He’d balk at the idea of “only” running a skunkworks.

It’s something that Tesla’s board should probably be weighing in on. And maybe they are. But numerous reports have also illustrated just how tightly linked that board is with Musk. They don’t appear to disagree on much, and that could cost Tesla its lead.

Software Development in Sri Lanka

Robotic Automations

Watch: Why Tesla’s big layoffs happened, and what comes next

Tesla’s layoffs and executive departures took a bite out of its share price this week. The well-known electric vehicle company shed around 10% of its staff, impacting an estimated 14,000 people or more. Two well-known executives also decided it was time to move on.

In response to the news, shares of Tesla lost ground. The company’s value has eroded this year, falling 35% through the end of trading yesterday.

The year has not been kind to Tesla. It missed delivery estimates for the first quarter, has reportedly reduced hours for the production line of its Cybertruck and is seeing rivals in China stack market share with low-priced EVs. Tesla, in other words, helped foster the global electric vehicle market but is losing some of its primacy in that same market.

Which may be a bigger risk than it seems. The global auto market is large, complicated and replete with different manufacturers and badges competing for share. What’s the risk of being a bit smaller than expected? For Tesla, a lot. The company is currently valued at a price/sales multiple of 6.2x, per Yahoo Finance. GM? It’s worth 0.34x. Ford? An even more modest 0.29x.

In human terms, for every dollar of car that Tesla sells, it generates far more company worth than its rivals. Why? Because many investors are betting that Tesla is not only going to keep growing its EV business that became a profit center in recent years, but also that its work in energy, energy storage and related industries will generate a company that is far larger, and more valuable over time. If Tesla was to trade at a GM or Ford-style revenue multiple, it would erase most of its worth.

And with price cuts, falling deliveries, increasingly sophisticated competition and now mass layoffs, Tesla is starting to look more like a traditional company than a company that can avoid traditional business rules and trade like its peers. Hit play, let’s chat!

Software Development in Sri Lanka