On October 10, Tesla (TSLA) held its "We, Robot" event on the Warner Brothers backlot at the Warner Bros. backlot in Burbank, California; the event was rescheduled from an earlier date in August.
During the event, its CEO, Elon Musk, revealed the long-awaited Robotaxi, a stylish autonomous vehicle equipped with butterfly doors but without pedals or a steering wheel. The design raised questions with some retail investors.
In the weeks before Tesla's third-quarter earnings were released, retail investors were invited to participate in an anonymous Q&A forum, where the top questions were about Tesla's mysterious "affordable model" that Musk had teased for years.
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"Is Tesla still on track to deliver the more affordable model next year, as mentioned by Elon earlier, and how does it align with your AI and product roadmap?" the top-voted question, representing 2.3 million total shares read.
"When can we expect Tesla to give us the ~$25K, non-robotaxi, regular car model?" the second highest-voted question said.
But while Musk may have addressed these questions during the earnings call, new developments have sparked more curiosity around Tesla's hotly anticipated EV.
Tesla's "Model Q"
On December 9, a note from analysts at Deutsche Bank said that it met with Travis Axelrod, the automaker's Head Of Investor Relations at its Autonomous Driving Day in New York City, where it noted that the storied EV firm will launch a vehicle it dubs the "Model Q;" a more affordable Tesla model.
"The new Tesla model (we refer to as "Model Q") should launch in 1H25 and will be priced <$30k including subsidies (i.e., $37,499 if US EV tax credit goes away)," Deutsche Bank analyst Edison Yu said in his note.
Additionally, the DB analyst noted that the new model could be joined with a long-wheelbase, three-row Model Y exclusively for China. Yu reported that the models would be built on existing production lines and that Tesla execs anticipate them to contribute to increasing volume by 20-30% in 2025.
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The announcement triggers skepticism by netizens, TSLA critics
News regarding Deutsche Bank's report garnered attention from observers, as it built upon previous remarks from Elon Musk during the 3Q 2024 earnings call on October 23. On that call, he confirmed the existence of "affordable models" down the pipeline that will contribute to "20% to 30%" vehicle sales growth.
"It will be like with incentive. So, 30K, which is kind of a key threshold," Musk said during the call.
But as Musk addressed the budget Tesla model, the message abruptly changed when he was asked about a "~$25K, non-robotaxi, regular car model," seeming to take the similar but differently worded question as one asking if Tesla would make a "conventional" version for $25,000.
"Having a regular, 25K model is pointless. It'd be silly. It'll be completely at odds with what we believe." Musk said.
"It's not going to be as good as a dedicated autonomous car. [...] Cybercab is just not going to have steering wheels and pedals. It's only designed to optimize for autonomy."
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However, when it comes to the DB report, onlookers are colored skeptical, as it is an unusual way to announce a new model.
"I give very little credibility to this report. It would be extremely surprising for Tesla’s IR head to reveal this information to a bank," Electrek writer Fred Lambert wrote in his report.
In the comments section of a post about the DB report on the r/RealTesla subreddit, different Reddit users expressed doubts about the report's validity.
"Rumors to help prop the stock until Musk can grift the feds? Color me shocked," user u/oregon_coastal said.
"[The "Model Q"] won't exist," Reddit user 22pabloesco22 added. "This is not about how terrible the product might be, this is about throwing shit out to pump stock."
"If people haven't figured it out by now, Musk is the head con artist in this pump and dump operation, but tons of people on wallstreet, the media, all of it are in on it. Not even counting the millions of youtube influencers or whatever that also help spread these rumors far and wide to ensure the stock trades like a high flying cloud software company..."
James Ochoa
While rumors fly, Tesla's competition heats up
According to the latest data from Cox Automotive and Kelley Blue Book, Tesla remains at the top of the EV food chain, but its position is being chipped away.
Their data shows that it has maintained a streak in which its EV market share fell below 50%. The third quarter of 2024 marked its second quarter in this position, as its sales made up 48.2% of the industry in Q3.
Additionally, establishment automakers are effectively making their current offerings more attractive than Tesla.
General Motors' Chevrolet Equinox EV undercuts Tesla's Model Y at $33,600, or $26,100, before fees and after the $7,500 IRA Federal tax credit, while Honda's Prologue has become a sales leader in the same segment.
In a feature by PCMag, owners credit the Honda's simplistic design and ease of use as reasons why they adopted the Prologue over similar Tesla models. Still, most notably, one owner mentioned that Honda heavily incentivizes owners to buy one with enticing lease deals and incentives.
"It’s a great car for what it does, at the price you can get one for with all the rebates and offers from Honda," one owner told PCMag. "They’re practically (kinda literally) begging people to buy these things."
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