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Time of India
an hour ago
- Automotive
- Time of India
Tesla faces difficult road ahead as it hopes robotaxis will offset declining sales
Tesla and its CEO Elon Musk are walking an increasingly difficult tightrope as the company navigates declining electric vehicle sales and an autonomous driving business that has yet to get off the ground. On Wednesday's earnings call, Musk said Tesla is "getting the regulatory permission to launch" robotaxis in several states, including California, Nevada, Arizona and Florida. He expects operations to reach "half the population of the U.S. by the end of the year" and to roll out at scale by the end of next year. So far, though, the company is operating only a small fleet in Austin, Texas, that is not available to the general public. And getting regulatory approvals, particularly in California, is likely to prove a bigger hurdle than Musk described on the call. "Tesla cannot afford a misstep with the robotaxi service," said Camelthorn Investments adviser Shawn Campbell, who owns Tesla shares. He added that "the wheels are coming off" its automotive business, with sales declines across "almost every market." Sales fell 13% for the first half of this year, as its core EV business deteriorated due to an aging lineup and brand damage from Musk's political activism. With no affordable vehicles on the horizon until the last three months of the year and the upcoming elimination of a $7,500 U.S. tax break for EV buyers, Musk acknowledged that the company could have "a few rough quarters." "The numbers kind of speak for themselves," said Ross Gerber , CEO of Gerber Kawasaki Wealth and Investment Management and a Tesla investor. "They're bad for a growth company, which isn't growing." Tesla shares were down more than 8% in midday trading on Thursday. They have declined 24% this year and robotaxis and autonomous driving are critical to maintaining the company's roughly $1 trillion stock-market valuation. Regulatory barriers The fall in core auto sales has led to more investor scrutiny of Musk's lofty robotaxi promises. Products such as the Cybertruck have come later than anticipated, and Musk has promised every year since 2016 that driverless Teslas would arrive no later than the following year. Many questions on Wednesday's call focused on how quickly Tesla would be able to expand robotaxi services, and the regulatory hurdles that remain. Musk said he expected the robotaxi business would have a "material impact" on Tesla's business by the end of next year. In April, he said it would become material "around the middle of next year," and predicted "millions of Teslas operating autonomously" by the second half of 2026. The San Francisco Bay Area was first on Musk's list of expansion markets, but California regulators told Reuters on Wednesday that Tesla had not yet applied for permits needed to pick up and charge passengers for rides in fully autonomous vehicles. Companies need a series of permits from both the California Department of Motor Vehicles (DMV) and the California Public Utilities Commission (CPUC) in order to test and deploy autonomous vehicles in the state. To date, Tesla only has obtained the first in a series of permits needed to launch a service, and spokespeople for both agencies said the company has not applied for the additional permits needed to test and operate autonomous vehicles. Tesla did not respond immediately to a request for comment. It disclosed in a filing on Thursday that regulators have asked for information on its robotaxi plans. Federal safety officials previously had said they were seeking information after reviewing online videos of robotaxis in Austin allegedly using the wrong lane and speeding. California has no specific time period to grant such permits, but Alphabet's Waymo, which offers autonomous ride-hailing in Los Angeles and the Bay Area, logged more than 13 million testing miles and secured seven different regulatory approvals over nine years before receiving approval to charge passengers for rides in driverless robotaxis in 2023. Tesla has logged just 562 testing miles (904 km) in California since 2016, and has not reported any autonomous-driving miles to the state in six years, according to the most recent state records. Paul Miller, principal analyst at market research and consultancy firm Forrester, pointed to Musk's comment about addressing half of the U.S. population "subject to regulatory approvals." "That caveat is an important one, as regulatory approvals take time," he said. Other markets Musk mentioned could move faster. In Arizona, a state Department of Transportation spokesperson said Tesla contacted state officials last month and had applied for permits to test and operate autonomous vehicles with and without a safety driver. The agency said a decision is expected at the end of the month. Tesla also must seek permits to operate a ride-hailing service and submit plans to the state for how police agencies can deal with their autonomous vehicles, the spokesperson said. Nevada DMV officials said they discussed the state's process with Tesla last week, but no steps have been taken, while officials in Florida did not respond to a request for comment. Some investors are also seeking more specifics about the Austin launch. Gene Munster, managing partner at Deepwater Asset Management, a Tesla investor, said he was disappointed the EV maker gave no updates on its earnings call on when the Austin service would be available to the general public or how many vehicles would be on the road. "It seemed like he wanted to kind of steer clear of really putting hard estimates out there for how things play out," Munster said. Outlook Morgan Stanley after the results predicted that Wall Street would lower forecasts in expectation of lower sales and higher costs. Musk did not mention his new political party, but his relationship with Trump has deteriorated. The president on Thursday denied that he was aiming to destroy Musk's companies. "Everyone is stating that I will destroy Elon's companies by taking away some, if not all, of the large scale subsidies he receives from the U.S. Government. This is not so!" Trump said in a social media post.
Zawya
3 hours ago
- Automotive
- Zawya
Tesla faces difficult road ahead as it hopes robotaxis will offset declining sales
LOS ANGELES - Tesla and its CEO Elon Musk are walking an increasingly difficult tightrope as the company navigates declining electric vehicle sales and an autonomous driving business that has yet to get off the ground. On Wednesday's earnings call, Musk said Tesla is "getting the regulatory permission to launch" robotaxis in several states, including California, Nevada, Arizona and Florida. He expects operations to reach "half the population of the U.S. by the end of the year" and to roll out at scale by the end of next year. So far, though, the company is operating only a small fleet in Austin, Texas, that is not available to the general public. And getting regulatory approvals, particularly in California, is likely to prove a bigger hurdle than Musk described on the call. "Tesla cannot afford a misstep with the robotaxi service," said Camelthorn Investments adviser Shawn Campbell, who owns Tesla shares. He added that "the wheels are coming off" its automotive business, with sales declines across "almost every market." Sales fell 13% for the first half of this year, as its core EV business deteriorated due to an aging lineup and brand damage from Musk's political activism. With no affordable vehicles on the horizon until the last three months of the year and the upcoming elimination of a $7,500 U.S. tax break for EV buyers, Musk acknowledged that the company could have "a few rough quarters." "The numbers kind of speak for themselves," said Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management and a Tesla investor. "They're bad for a growth company, which isn't growing." Tesla shares were down more than 8% in midday trading on Thursday. They have declined 24% this year and robotaxis and autonomous driving are critical to maintaining the company's roughly $1 trillion stock-market valuation. REGULATORY BARRIERS The fall in core auto sales has led to more investor scrutiny of Musk's lofty robotaxi promises. Products such as the Cybertruck have come later than anticipated, and Musk has promised every year since 2016 that driverless Teslas would arrive no later than the following year. Many questions on Wednesday's call focused on how quickly Tesla would be able to expand robotaxi services, and the regulatory hurdles that remain. Musk said he expected the robotaxi business would have a "material impact" on Tesla's business by the end of next year. In April, he said it would become material "around the middle of next year," and predicted "millions of Teslas operating autonomously" by the second half of 2026. The San Francisco Bay Area was first on Musk's list of expansion markets, but California regulators told Reuters on Wednesday that Tesla had not yet applied for permits needed to pick up and charge passengers for rides in fully autonomous vehicles. Companies need a series of permits from both the California Department of Motor Vehicles (DMV) and the California Public Utilities Commission (CPUC) in order to test and deploy autonomous vehicles in the state. To date, Tesla only has obtained the first in a series of permits needed to launch a service, and spokespeople for both agencies said the company has not applied for the additional permits needed to test and operate autonomous vehicles. Tesla did not respond immediately to a request for comment. It disclosed in a filing on Thursday that regulators have asked for information on its robotaxi plans. Federal safety officials previously had said they were seeking information after reviewing online videos of robotaxis in Austin allegedly using the wrong lane and speeding. California has no specific time period to grant such permits, but Alphabet's Waymo, which offers autonomous ride-hailing in Los Angeles and the Bay Area, logged more than 13 million testing miles and secured seven different regulatory approvals over nine years before receiving approval to charge passengers for rides in driverless robotaxis in 2023. Tesla has logged just 562 testing miles (904 km) in California since 2016, and has not reported any autonomous-driving miles to the state in six years, according to the most recent state records. Paul Miller, principal analyst at market research and consultancy firm Forrester, pointed to Musk's comment about addressing half of the U.S. population "subject to regulatory approvals." "That caveat is an important one, as regulatory approvals take time," he said. Other markets Musk mentioned could move faster. In Arizona, a state Department of Transportation spokesperson said Tesla contacted state officials last month and had applied for permits to test and operate autonomous vehicles with and without a safety driver. The agency said a decision is expected at the end of the month. Tesla also must seek permits to operate a ride-hailing service and submit plans to the state for how police agencies can deal with their autonomous vehicles, the spokesperson said. Nevada DMV officials said they discussed the state's process with Tesla last week, but no steps have been taken, while officials in Florida did not respond to a request for comment. Some investors are also seeking more specifics about the Austin launch. Gene Munster, managing partner at Deepwater Asset Management, a Tesla investor, said he was disappointed the EV maker gave no updates on its earnings call on when the Austin service would be available to the general public or how many vehicles would be on the road. "It seemed like he wanted to kind of steer clear of really putting hard estimates out there for how things play out," Munster said. OUTLOOK Morgan Stanley after the results predicted that Wall Street would lower forecasts in expectation of lower sales and higher costs. Musk did not mention his new political party, but his relationship with Trump has deteriorated. The president on Thursday denied that he was aiming to destroy Musk's companies. "Everyone is stating that I will destroy Elon's companies by taking away some, if not all, of the large scale subsidies he receives from the U.S. Government. This is not so!" Trump said in a social media post. (Reporting by Chris Kirkham in Los Angeles, Akash Sriram in Bengaluru and Abhirup Roy in San Francisco; Editing by Peter Henderson and Jamie Freed)
Yahoo
3 hours ago
- Automotive
- Yahoo
Tesla reports 42% YoY drop in operating income
This story was originally published on Automotive Dive. To receive daily news and insights, subscribe to our free daily Automotive Dive newsletter. Tesla's year-over-year operating income plummeted 42% in Q2, from $1.6 billion to $923 million, the company reported on Wednesday. The automaker cited lower regulatory credit revenue, an increase in operating expenses driven by AI and other R&D projects, as well as a decline in vehicle deliveries. Switch Auto Insurance and Save Today! Affordable Auto Insurance, Customized for You The Insurance Savings You Expect Great Rates and Award-Winning Service Tesla's automotive revenue also declined 16% in the quarter, from $19.8 billion to $16.6 billion, as its global EV sales continue to stall. The company's Q2 net income also fell by 16% YoY, from $1.4 billion to $1.17 billion. It's Tesla third consecutive quarterly revenue decline. Tesla also reported a 71% YoY decline in net profit in Q1, which followed an 8% decline in Q4 revenue to close out 2024. Earlier this month, Tesla reported Q2 global deliveries of 384,122 vehicles, a 13.5% YoY decline. Production totals, however, were relatively the same as last year for the EV maker, reaching 410,244 units in the quarter versus the 410,831 units that Tesla produced during the same period last year. Although global production of the Model Y and Model 3 increased 3% YoY in Q2, production of the Model S, Model X and Cybertruck decreased by 45%. Tesla, however, does not break down the sales of individual models. Tesla feels competitive crunch in both Europe and China In Europe, Tesla is facing growing competition from legacy automakers and EV makers from China entering the EU market, including BYD. China is also the world's largest exporter of EVs, according to the International Energy Agency. The country exported 1.25 million EVs last year, which is equal to 40% of all global exports. During its earnings call, Tesla CEO Elon Musk said the sales slump in Europe is partially due to it not being approved to offer its supervised Full Self Driving automated driving feature, which is available to customers in the U.S. 'So our sales in Europe, we think, will improve significantly once we are able to give customers the same experience that they have in the U.S.,' Musk said. But outside of Europe, Tesla is also dealing with slowing sales in China, which is the world's largest auto market with the highest volume of EV sales globally. BYD for example, is the top-selling brand in China, according to S&P Global, but now the company is aiming to grow its EV market share in Europe and other countries, including Mexico. S&P Global Mobility predicts that BYD will more than double its European EV sales in 2025 to 186,000 units, with volumes expected to double again to just under 400,000 units by 2029. Outside of China, BYD's rapid rise in Europe is increasing competitive pressure on Tesla in the region. Tesla's EU sales in April were down 49% YoY, despite battery-electric vehicle sales in the region growing by 27.8%, according to Reuters. 'Competitors have used the brand's decline as an opportunity to catch up with its once-impressive credibility and appeal,' said Gabor Schreier, chief creative officer at Saffron Brand Consultants, in an emailed statement to Automotive Dive. 'BYD has overtaken Tesla as the world's largest electric vehicle manufacturer, and Volkswagen has sold more EVs in Europe than Tesla.' Tesla is also facing growing competition in its home market from General Motors as the automaker continues to execute its ambitious EV rollout. In the U.S. market, GM now has the second highest EV sales behind Tesla. The automaker's EV sales were up 104% YoY in the first half of 2025, which reflects an estimated 13% market share in the U.S., according to its Q2 sales report. In Q2, GM's YoY EV sales increased 111% to 46,280 units. Musk's close involvement with the Trump administration as the head of the Department of Government Efficiency, along with some of his public statements on social media, has also resulted in a public backlash against the electric automaker in North America. As tariffs tensions arose between the U.S. and Canada earlier this year as a result of Trump administration trade policies, a Canadian citizen launched a petition urging former Prime Minister Justin Trudeau to revoke Musk's dual citizenship. The petition claimed that he engaged in activities that 'go against the national interest of Canada.' The petition, which was signed by over 230,000 people, said that attempts by Musk to 'attack Canadian sovereignty must be addressed.' In response, Musk posted on his social media platform X to his tens of millions of followers that 'Canada is not a real country.' Musk's statement, which has since been deleted, coincided with a sharp decline in sales in Canada. Automotive News Canada reported on July 11 that Tesla vehicle registrations fell by 67% in the country in the first half of 2025. 'The Tesla brand is definitely damaged, but I think it is masking the real issue, which is that the EV market has rapidly matured and Tesla is no longer the shining star in the pack of predominantly ICE manufacturers,' said Daniel Binns, global CEO at Elmwood Brand Consultancy, in an emailed statement to Automotive Dive. But despite Tesla's sales declines and controversies surrounding Musk, many investors are still betting on the company's future, especially in the areas of AI, robotics, autonomous driving, robotaxis and its growing energy storage business. Tesla's stock price is down over 20% since Jan.1, but it's still up 40% from a year ago, which indicates ongoing investor confidence in the company despite its recent revenue declines. Musk however, remains optimistic that Tesla can recover. 'I do think if Tesla continues to execute well with vehicle autonomy and humanoid robot autonomy, it will be the most valuable company in the world,' said Musk on the earnings call. Recommended Reading Tesla CFO offloads over $2M in stock as EU sales tumble
ArabGT
7 hours ago
- Automotive
- ArabGT
Tesla Struggles as Profits Plunge and Promises Fall Short
Elon Musk's Tesla may be facing its most significant reckoning yet. As financial losses mount and ambitious future projects remain stuck in the planning phase, many are wondering: has the Tesla bubble finally started to deflate? A Troubling Quarter for Tesla In its Q2 2025 earnings report, Tesla stunned investors with a steep 16% year-over-year drop in automotive revenue—from $19.9 billion to $16.7 billion. Overall company revenue fell to $22.5 billion, marking a 12% decline. The figures were more than disappointing—they signaled a fundamental shift in Tesla's performance trajectory. Worse yet, gross profits fell to $3.9 billion, a 15% dip compared to the same period last year. While earnings before interest, taxes, depreciation, and amortization (EBITDA) held at $3.4 billion (down 7%), the results reflected a weakening profit engine. High Hopes, Little Progress Investors had been clinging to hope in Tesla's forward-looking ventures, including the long-teased second-generation Roadster and the highly anticipated Robotaxi program. But the earnings report cast doubt on these lifelines. The Roadster remains in the early design stage, while the Robotaxi pilot in Austin lacks a solid business model and has yet to generate revenue. Sales Slide Adds to Pressure Compounding Tesla's troubles, sales of its mainstays—the Model 3 and Model Y—fell by 12%, totaling just 373,728 units. Deliveries of premium models like the Cybertruck, Model S, and Model X dropped an alarming 52%, falling to 10,394 units. These steep declines underscore Tesla's risky dependence on a narrow product lineup without meaningful diversification. Avoiding the Elephant in the Room Tesla's leadership attributed the slump to regulatory headwinds, lower average selling prices, and intensifying competition. However, the company sidestepped two increasingly pressing issues: the polarizing political activity of CEO Elon Musk, which has clouded the company's once-sterile image, and the global rise in interest rates, which is hurting consumer affordability and investor enthusiasm. Why the Roadster and Robotaxi Won't Save Tesla—Yet Though packed with futuristic promise, neither the Roadster nor the Robotaxi service are close to becoming financial game-changers. The Roadster is still a design on paper, and the Robotaxi—despite its pilot rollout—lacks a working revenue model. Tesla's Core Challenges Rising Competition: Chinese rival BYD continues to expand aggressively in Europe, tightening its grip on market share as Tesla stalls. Global Economic Strains: Inflation and high interest rates are cutting into consumer spending power and weakening demand for premium electric vehicles. Brand Image Turbulence: Musk's public behavior and political entanglements are alienating core consumer bases and tarnishing Tesla's neutral tech-forward brand. Cybertruck Setbacks: Dismal delivery numbers suggest fundamental issues in both the truck's design and production pipeline, belying the media hype. A Pivotal Crossroads The real race isn't just about tomorrow's electric dream—it's about maintaining today's dominance. Tesla's visionary projects won't be enough to stabilize its current finances. To avoid becoming a casualty of its own hype, Tesla must act fast: rethink pricing, expand its product strategy, and win back consumer trust. Otherwise, the company might be writing the first chapter in the story of its own bubble burst.
NDTV
13 hours ago
- Automotive
- NDTV
Tough Road For Tesla As It Hopes Robotaxis Will Offset Declining Electric Vehicle Sales
Tesla and its CEO Elon Musk are walking an increasingly difficult tightrope as the company navigates declining electric vehicle sales and an autonomous driving business that has yet to get off the ground. On Wednesday's earnings call, Musk said Tesla is "getting the regulatory permission to launch" robotaxis in several states, including California, Nevada, Arizona and Florida. He expects operations to reach "half the population of the US by the end of the year" and to roll out at scale by the end of next year. So far, though, the company is operating only a small fleet in Austin, Texas, that is not available to the general public. And getting regulatory approvals, particularly in California, is likely to prove a bigger hurdle than Musk described on the call. "Tesla cannot afford a misstep with the robotaxi service," said Camelthorn Investments adviser Shawn Campbell, who owns Tesla shares. He added that "the wheels are coming off" its automotive business, with sales declines across "almost every market." Sales fell 13% for the first half of this year, as its core EV business deteriorated due to an aging lineup and brand damage from Musk's political activism. With no affordable vehicles on the horizon until the last three months of the year and the upcoming elimination of a $7,500 US tax break for EV buyers, Musk acknowledged that the company could have "a few rough quarters." "The numbers kind of speak for themselves," said Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management and a Tesla investor. "They're bad for a growth company, which isn't growing." Tesla shares are already down nearly 18% this year and robotaxis and autonomous driving are critical to maintaining the company's roughly $1 trillion stock-market valuation. Regulatory Barriers The fall in core auto sales has led to more investor scrutiny of Musk's lofty robotaxi promises. Products such as the Cybertruck have come later than anticipated, and Musk has promised every year since 2016 that driverless Teslas would arrive no later than the following year. Many questions on Wednesday's call focused on how quickly Tesla would be able to expand robotaxi services, and the regulatory hurdles that remain. Musk said he expected the robotaxi business would have a "material impact" on Tesla's business by the end of next year. In April, he said it would become material "around the middle of next year," and predicted "millions of Teslas operating autonomously" by the second half of 2026. The San Francisco Bay Area was first on Musk's list of expansion markets, but California regulators told Reuters on Wednesday that Tesla had not yet applied for permits needed to pick up and charge passengers for rides in fully autonomous vehicles. Companies need a series of permits from both the California Department of Motor Vehicles (DMV) and the California Public Utilities Commission (CPUC) in order to test and deploy autonomous vehicles in the state. To date, Tesla only has obtained the first in a series of permits needed to launch a service, and spokespeople for both agencies said the company has not applied for the additional permits needed to test and operate autonomous vehicles. Tesla did not respond immediately to a request for comment. California has no specific time period to grant such permits, but Alphabet's Waymo, which offers autonomous ride-hailing in Los Angeles and the Bay Area, logged more than 13 million testing miles and secured seven different regulatory approvals over nine years before receiving approval to charge passengers for rides in driverless robotaxis in 2023. Tesla has logged just 562 testing miles (904 km) in California since 2016, and has not reported any autonomous-driving miles to the state in six years, according to the most recent state records. Paul Miller, principal analyst at market research and consultancy firm Forrester, pointed to Musk's comment about addressing half of the US population "subject to regulatory approvals." "That caveat is an important one, as regulatory approvals take time," he said. Other markets Musk mentioned could move faster. In Arizona, a state Department of Transportation spokesperson said Tesla contacted state officials last month and had applied for permits to test and operate autonomous vehicles with and without a safety driver. The agency said a decision is expected at the end of the month. Tesla also must seek permits to operate a ride-hailing service and submit plans to the state for how police agencies can deal with their autonomous vehicles, the spokesperson said. Nevada DMV officials said they discussed the state's process with Tesla last week, but no steps have been taken, while officials in Florida did not respond to a request for comment. Some investors are also seeking more specifics about the Austin launch. Gene Munster, managing partner at Deepwater Asset Management, a Tesla investor, said he was disappointed the EV maker gave no updates on its earnings call on when the Austin service would be available to the general public or how many vehicles would be on the road. "It seemed like he wanted to kind of steer clear of really putting hard estimates out there for how things play out," Munster said.
