4 Key Takeaways From Elon Musk’s Comments During Tesla’s Q1 Earnings Call

After Tesla (TSLA) reported earnings for the first quarter that came in short of analysts’ expectations, Chief Executive Officer Elon Musk joined other company leaders on the electric vehicle (EV) maker’s earning call.

Musk touched on Tesla’s accelerated new-product timeline, news of which was unveiled in the earnings announcement and sent the company’s shares sharply higher in after-hours trading. He also addressed talks the company is having with a traditional automaker to license Tesla’s autonomous driving technology, as well as the upcoming robotaxi launch and its humanoid robot.

Tesla shares continued gaining ground during the earnings call and finished the extended session up 13.3% at $163.96. Through Tuesday’s close, the stock had lost 42% of its value since the start of the year.

‘More Affordable’ Models Coming in Early 2025 or Sooner

Musk said that Tesla has accelerated its future product roadmap and is set to start production in early 2025, or late 2024. The company had previously indicated this production wouldn’t start until the second half of 2025.

Among the new vehicles, there are “more affordable models” that use Tesla’s “next generation platform” and its current tech. Musk first brought up the prospect of a $25,000 Tesla car in 2018 when he said it would take about three years to make.

The new models will be produced on the same manufacturing lines that Tesla uses to produce its current vehicle lineup, Musk said, which could ease investor concerns about costs and timing.

Tesla in Talks With a ‘Major’ Automaker to License Self-Driving Tech

When asked if any legacy automakers have reached out to Tesla about licensing the company’s full self-driving (FSD) technology for their vehicles, Musk said that Tesla is “in conversations with one major automaker regarding licensing FSD.”

Musk said that there is a “good chance” that Tesla will sign a licensing agreement this year, though other company leaders noted that it would take at least three years after the contract for the tech to be integrated into an external automaker’s vehicles.

He added that licensing Tesla’s FSD tech to other automakers could positively affect the company’s cash flow as autonomous driving is further adopted.

Musk also acknowledged that “other auto manufacturers are pulling back on EVs, and pursuing plug-in hybrids” amid EV demand pressures, saying that Tesla believes “this is not the right strategy, and electric vehicles will ultimately dominate the market.”

Musk Provides a Look at ‘Cyber Cab’ Vision Ahead of August Launch

Musk provided investors with some insights into Tesla’s long-awaited robotaxi, or the “cyber cab” which is set to launch on Aug. 8. The robotaxi is part of Tesla’s vision to create an autonomous taxi service.

Musk explained that “there’ll be some number of cars that Tesla owns itself and operates in the fleet” as well as “a bunch of cars where they’re owned by the end user.” Owners make money by renting out their self-driving vehicle to robotaxi users and Tesla will take a commission. Musk said that investors can think of Tesla as “some combination” of Uber (UBER) and Airbnb (ABNB).

He added that there is potential for “an AWS element down the road,” explaining that Tesla’s robotaxi fleet would have the computing technology to run interfacing and AI workloads when it’s not being used for driving.

The CEO also touched on regulatory concerns surrounding autonomous driving tech. Musk said that he doesn’t think “there will be significant regulatory barriers, provided there’s conclusive data that the autonomous car is safer than a human-driven,” adding that “stopping autonomy means killing people.”

Tesla’s Humanoid Robot, Optimus,

Musk said that Optimus is doing “simple factory tasks” in the lab and is expected to be in Tesla’s factory by the end of 2024. He added that it could be ready to be sold externally by the end of 2025.

He reiterated that he thinks “Optimus will be more valuable than everything else combined,” saying that there is “no meaningful limit to the size of the economy” for “a sentient humanoid robot that is able to navigate reality and do tasks at request.”

“Tesla is best positioned of any humanoid robot maker to be able to reach volume production with efficient inference on the robot itself,” Musk said, adding that “there’s no company even close to the inference efficiency of Tesla.” He said Tesla’s interference tech “will pay dividends in many ways.”