Elon Musk should focus on the cars, not robots, expert says
18:49, 20 August 2021
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Elon Musk’s celebration of Tesla’s artificial intelligence roadmap, including the theatrical appearance of a prototype humanoid robot on Thursday evening, has drawn some harsh words from one expert follower of the company.
Daniel Ives, an analyst with New York-based Wedbush Securities, questioned on Friday the relevance of the Tesla Bot at a time of growing concerns about the company’s ability to respond to rising competition in the electric-vehicle (EV) business, as well as pressure from government about the safety of its autonomous driving technology.
Yet Ives also remains a supporter of the company, maintaining an “outperform” rating with a target of $1,000 per share.
“Unfortunately, as we have seen with robo-taxis and other future sci-fi projects for Musk, we view this Tesla Bot as an absolute head-scratcher that will further agitate investors at a time the Street is showing growing concern around rising EV competition and safety issues for Tesla," Ives wrote in a note to clients.
With the EV market at "a critical juncture," he added, investors want to see more focus on chips, full self-driving (FSD) technology and efforts that deal with China's reaccelerating EV demand.
Tesla under 'major scrutiny'
Tesla unveiled images of the humanoid robot, and a human dressed like the machine performed a brief dance routine, during the Tesla AI Day event on Thursday night, 19 August, in Freemont, California.
The company intends to roll out a prototype “some time next year” Musk said during the live-streamed event that included other Tesla personnel and an audience of potential engineering recruits.
"To this point, with Tesla under major scrutiny for safety issues on FSD and a new US probe now underway, clearly, Tesla recognises there are deficiencies in its current process that must be significantly improved through real-time AI to reach the eventual aspirational goal of true FSD over the coming years," wrote Ives.
He said FSD safety issues have "gained steam" over the past week and represent "another overhang," or value-dilution risk, for Tesla's share price.
Musk said Tesla is "more than an electric-car company." Ives noted that, but commented that investors want Musk to focus on near-term battery technology enhancements, capacity build-outs at its gigafactories in Berlin and Austin, Texas, and fend off rising global EV competition, "and not humanoid robots."
Shares in Tesla were up on Friday afternoon in New York by over 1%.
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