Tesla’s Robotaxi Riddle & The Stock

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So, Tesla. A company that makes perfectly respectable electric cars, and also, apparently, dreams of a future populated by driverless taxis. It’s a bold vision, you have to admit. A bit like imagining the Victorians predicting the internet, perhaps. They’d have been busy perfecting steam-powered telegrams, and here we are. Anyway, Tesla recently confirmed that production of its Cybercab – a name that sounds like something out of a low-budget science fiction film – will begin in June. The thing is, a few wrinkles are appearing in this otherwise gleaming plan, and those wrinkles, as any investor knows, can quickly become chasms.

They’ve reported 14 crashes involving their robotaxi fleet in Austin, Texas, since last June. Now, 14 doesn’t sound like a lot, does it? It’s roughly the number of times I’ve mislaid my keys this month. But consider this: that works out to about one crash every 57,000 miles. For context, and this is where it gets interesting, human drivers, according to Tesla’s own data, manage a collision roughly every 229,000 miles. The National Highway Traffic Safety Administration puts it even higher, at 500,000 miles. So, Tesla’s robotaxis are crashing, shall we say, with a frequency that’s… notable. Four to eight times more often than us fallible humans. And, crucially, all these incidents have involved a human “safety monitor” in the driver’s seat. Which rather begs the question, doesn’t it?

The situation in California is equally… nuanced. Tesla is navigating a bit of a regulatory maze, admitting that its vehicles require both a human driver and remote assistance operators. It’s a bit like saying you’ve invented a self-cleaning oven, but you still have to occasionally give it a scrub. It’s not entirely dishonest, but it’s not quite the revolution we were promised. Interestingly, this reliance on humans is what allowed Tesla to keep its small fleet operational during a recent blackout in San Francisco, while Waymo, Alphabet’s autonomous vehicle arm, struggled. It wasn’t some technological triumph, it turns out, just good old-fashioned manpower. Or, in this case, man-and-machine power.

This whole affair has led to a bit of a spat with Waymo. Tesla is arguing that its “robotaxi” operations shouldn’t be subject to the same rules as fully autonomous vehicles, essentially admitting, in a roundabout way, that they aren’t entirely autonomous. Simultaneously, they’re fighting a proposal that would prevent them from using words like “driverless” and “self-driving” in their marketing. They already lost a ruling over the use of “Autopilot” and “Full Self-Driving,” which a court deemed false advertising. It’s a bit like claiming you’ve invented a perpetual motion machine and then getting upset when people point out that it doesn’t actually work.

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Trouble Brewing for Tesla’s Stock

Here’s where the stock market enthusiasts among us start to get a little twitchy. Tesla’s core electric vehicle business is facing headwinds, and the stock is trading at a forward price-to-earnings ratio of 199. That’s… optimistic. A lot of investor hopes are pinned on these robotaxi ambitions. The company can build these Cybercabs, seemingly at a reasonable cost, but whether it can build a truly safe autonomous driving system is another matter entirely. And that, as any seasoned investor will tell you, is the crucial question.

CEO Elon Musk has made a few predictions about robotaxis in the past, and let’s just say they haven’t exactly materialized. According to Electrek, Tesla currently has about 42 robotaxis operating in Austin, with less than 20% available during operating hours. That’s a far cry from the 500 he promised by the end of 2025. And expansion to the eight to ten cities he projected? Still a work in progress. It’s a reminder that even the most visionary entrepreneurs can be a bit optimistic with their timelines.

At some point, Tesla has to deliver on the robotaxi promise. If it doesn’t, its stock is in danger of a rather significant correction, given its valuation and the weakening performance of its core business. It’s a bit like building a magnificent castle on a foundation of sand. It might look impressive for a while, but eventually, gravity will have its say.

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2026-02-24 03:12