Back in April, it sounded like a good idea.
On April 8 Tesla (TSLA) Chief Executive Elon Musk made the announcement on his X, the microblogging platform he owns.
Related: Tesla pushes back big robotaxi unveiling
"Tesla Robotaxi unveil on 8/8," he wrote.
A few weeks later, on April 23, Musk told analysts during the electric vehicle maker's first-quarter-earnings call that "we will be showcasing our purpose-built robotaxi or Cybercab in August."
Tesla had provided a sneak peek of its upcoming ride-hailing mobile app in the earnings report. It included five screens, featuring a Summon button and estimated wait times, followed by a 3D map displaying a virtual vehicle en route to the passenger.
Musk has suggested that Tesla owners would be able to earn revenue from their personally owned autonomous cars by sending them out to pick up and drop off passengers.
"There will be some number of cars and then there'll be a bunch of cars where they're owned by the end user," Musk said.
Tesla stock takes a tumble
"That end user can add or subtract their car to the fleet whenever they want, and they can decide if they want to only let the car be used by friends and family or only by five-star users or by [anyone. At] any time they could have the car come back to them and be exclusively theirs like an Airbnb," he added
During the call, Musk repeated his belief that “in the future, gasoline cars that are not autonomous will be like riding a horse and using a flip phone."
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"And that will become very obvious in hindsight," he said.
But something happened on the way to August.
Bloomberg News reported that the unveiling of the robotaxi will be moved from Aug. 8 until October.
Tesla’s stock tumbled 8.4% following the report, marking the company's first share-price loss after 11 straight gains and the biggest one-day decline since a 12.1% fall on Jan. 25, which followed a disastrous analyst earnings call.
The report did not give a specific date for the new unveiling.
The reason for the delay, Bloomberg said, was that teams working on the project "needed more time to build additional prototypes."
Of course, this wasn't the first time Musk had promised the world a robotaxi. In 2019, he said Tesla would have over a million fully autonomous robotaxis on the road by mid-2020.
“Tesla has been playing this game for nearly a decade of promising ‘next year, next year’. And I’ve seen no indication that Tesla … is on track for a meaningful deployment of the kind of automated driving system that Tesla has consistently promised,” Bryant Walker Smith, a University of South Carolina law professor who has expertise in autonomous-vehicle law, told Reuters.
Analysts issued research notes on July 12 adjusting their ratings and price targets one day after the robotaxi announcement.
UBS downgraded Tesla to sell from neutral with a price target of $197, up from $147. The stock's valuation premium has widened of late on artificial intelligence enthusiasm, the firm said, according to The Fly. (The stock closed Thursday, July 11, at $241.03, so UBS's new target indicates a 39% drop.)
The firm said it had downgraded the stock to sell following the recent share rally due to the lack of visibility and the risk that Tesla's growth opportunities materialize on a longer time horizon or not at all.
Analyst concerned about 'growth opportunities'
Mizuho raised its price target on Tesla to $230 from $180 and affirmed a neutral rating on the shares.
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The Austin company reported better June-quarter electric-vehicle deliveries, up 15% quarter-over-quarter, while core EV deliveries continued to slow, down 5% year-over-year, the firm said.
Mizuho said Tesla is now focusing on new markets with humanoid robots and the robotaxi roadmap, which "could be much more difficult" and challenging versus the company's expectations.
The investment firm adjusted its estimates for modestly higher EV deliveries, thinner gross margins with pricing, and modestly higher operating margin with head-count cuts.
On July 11, Citi analyst Itay Michaeli raised the firm's price target on Tesla to $274 from $182 and also affirmed a neutral rating on the shares.
The analyst has "been more constructive" on near-term investor sentiment around Tesla but said the stock's strong runup adds greater reliance on looming EV product and artificial intelligence catalysts.
The second-quarter delivery beat was also "encouraging," which prompted increased estimates and supports Citi's underlying call for improving EV sentiment this summer.
But the analyst said that core EV fundamentals alone are unlikely to support significantly further upside in Tesla shares absent new product and AI catalysts.
"We're not inclined to chase the stock here," Michaeli said.
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