Self Driving is an ambitious project by Tesla. Which is started with the to replace human drivers from the vehicles and replace it with the self driving computer program. The thing has so much economic value. That the people get tempted towards it. Which is reflected in terms of market Valuations of Tesla. But ever since achievements relative to their projections are very little. And it started to hurt the market Valuations of the company.
- Elons History of false projections
Elon made headlines about self-driving vehicles in 2013 and said Tesla will be able to achieve 80 to 90% self-driving technology by Next year. Years later Tesla was no wear near the self driving technology. First their Elon made predictions about next year and 2015. In 2016 Tesla promised to put 500,000 self-driving vehicles on the market. But Tesla came No way near it. The only ability they were able to build in the model was auto parking. The car didn’t even shift the line on the road. Then Tesla shifted this projection to 2019. In 2020 Tesla is able to introduce its Model with the name FSD full self driving model. Which can only work with the help of human assistance. In 2021 Tesla started its subscription model. At $12000 for a lifetime subscription. But because of the quality of the product Tesla Only was able to sell a handful of subscriptions which were no way near to their Projections.
- Elon Future Projects and Wall Street
It has been 20 years to the inception of Tesla but Tesla came no way near to its market cap relative to its profits when we compare it with the other companies. Investors always bought its future potential. What potentially it could do in the future that is way we saw its market value see as high as $1 trillion. Its $1 trillion market value was more than the total market cap sum of its all rivals. It touched 1 trillion in 2021 with the hopes that the FSD model will be widely adopted and an announcement about Tesla robo taxis.
But after the introduction of FSD and by seeing its abilities . The investor turned bearish on Tesla. Ever since Elon has made a lot of statements about when they are going to be fully autonomous. But each time the statement turns out to be false. Which shakes the investor confidence about the future of Tesla self driving vehicles abilities.
- Tesla in comparison of other competitors
Tesla, which is selling its ability to autonomous vehicles to Wall Street very aggressively, is not even the leader. The companies like waymo, and cruise which and subsidiaries of Google and GM respectively have achieved Self driving level-3 and Tesla is still behind at level – 2. Which is a huge set back for the company and investors who were trusting Elon musk.
- Can Elon still sell to investors the future of self-driving cars?
There are still a lot of investors who buy the vision of self-driving cars. But as the time is passing and Tesla is missing it’s every projection about the self driving cars. The investor confidence is shaking up. But there are still investors at Tesla like Cathie Wood who think Tesla has huge potential in the future. And who still believes in Elon’s vision for the future.
But now it seems investors will only be interested in some material transformation of his vision. Other than this passing time time will deplete the investors confidence. And things already started to be visible since Tesla introduced its FSD and market cap touched 1 trillion dollars. The investor turned bearish at Tesla and almost lost 45% of its Value over the period of 2 and a half years.
5. Can Investors turn bullish on Tesla again ?
The only way it seems, is if Elon wants to win back the investor confidence back is deliver something materially. Talks and some optimistic projections will not do very much differently.