In the Cybertruck Tesla failed to deliver on the expectations they set: A truck with 500 miles of range for $70k (or 300 miles for $39k). Part of this was due to Biden-era inflation, but no matter. They overpromised and underdelivered and the result was that roughly 2 million pre-orders became 70,000 in sales over several years. In the latest year, I think they only shipped around 9,000 of them. The people who have them love them, but Tesla never really overcame the initial gap between promise and delivery. (Note that the pre-orders came after the Cybertruck was revealed, so the out-of-the-ordinary styling wasn’t an issue for the pre-order folks.)
That said, I think two things:
One, Tesla remains more responsive than most to market conditions. The market wasn’t buying what Tesla was selling, so -poof- the vehicle is gone (much like the Model X and Model S). This isn’t a bad trait, even though I wish they had more vehicle options to choose from. I continue to think that smaller, less expensive pickup truck would sell very well for them.
Second, the Cybertruck production line is being converted to Cybercabs robotaxis. These cars offer the possibility of a wholesale transportation revolution: When cars can drive themselves and transport is, like an Uber, just a tap in an app away, why own a car?
Some will want to, of course, but the personal transportation industry is ripe for disruption. Cars are a headache. Expensive to buy, expensive to operate, and expensive to insure. And 95% of the time they actually have negative value: They sit in a garage, driveway, or parking lot and do nothing but slowly depreciate. They derive all their value from that other 5% when they’re transporting you from A to B. There’s nothing that says you have to own a car to do that A to B most of the time and that’s the allure of the Tesla’s Cybercab and Robotaxi service.
Tesla now has over 300 Cybercabs running in Austin, Texas. The geo-fenced area they’re running there has expanded dramatically (far beyond what Waymo offers) and they’re dramatically less expensive than Uber or Lyft for riders. They run the same self-drive software as other Teslas which presently sits at about 9x safer than human drivers, given miles driven between accidents. The four Cybercab accidents I’m aware of have all been low speed—hitting a pot hole, that kind of thing—and there has been no injuries or anything serious.
So I don’t think most people see what’s coming. Indeed, most folks are still driving gas-powered cars even though they’re worse for the environment and are harder and more expensive to operate and maintain. But price will win out. You can spend $30k or more for a car, have to house it, maintain it, fill it up with gas, and insure it. Or spend $4 to have a car show up and autonomously drive you to work or school or the store or whatever. Not everyone will choose that option, especially at first, but a lot of people will because the cost savings are too extreme to pass up.
The long-term argument has been that the technology isn’t ready yet, but Tesla Model 3 and Model Ys are already driving autonomously for most in-town and highway journeys. Cybercabs are already populating the streets of Austin, Texas and a rollout for Dallas, Texas is next. (This is not counting Tesla’s Robotaxi service that is using Model Ys for ride hailing and are operational in Fort Worth, Texas; Houston, Texas; Miami, Florida; Orlando, Florida; Tampa, Florida; and the San Francisco Bay Area.)
Maybe I’m wrong (and Musk is too) about what’s coming. But if I am, I definitely have a blindspot. Right now I don’t really see why the future for city and suburban transport won’t work out this way.