Is Tesla Steering Away from Car Manufacturing into the Autonomous Era?

Tesla’s Strategic Shift

Tesla intends to stop being a car manufacturer? That’s approximately what one of Tesla’s top executives recently declared after the release of another financial report. Recall, the company unexpectedly announced the cessation of production of the Model X and Model S models. Although this was anticipated amid extremely low sales, it turns out that Tesla now has only two popular models left (Model 3 and Model Y) and the failed Cybertruck (when compared to the company’s plans). The Semi trucks have still not been fully released, the new Roadster is even further away, and the affordable model priced at $25,000 has been entirely canceled.

Against this backdrop, at the conference following the report, Tesla was asked about car production, to which one of the top executives stated that the company should now be considered more of a ‘transportation as a service’ concept than a car manufacturer. Elon Musk himself stated that Tesla does not need to produce more mass-production cars, because in the future, all cars will be autonomous.

The Future of Autonomy

In the future, the overwhelming majority of miles will be driven in autonomous mode. You know, I would say that probably less – I’m just speculating – but probably less than 5% of driven miles will be attributed to self-driving, possibly only 1%. So, you know, I think in the long term… the only vehicles we’ll be producing will be unmanned ones.

Of course, the cessation of car production is not in question, but such statements make one doubt Tesla will somehow develop the direction of conventional vehicles for ordinary consumers. As for unmanned vehicles, at least for now, Robotaxi statistics for accidents are almost an order of magnitude worse than that of a regular driver.

Financial Insights

Tesla’s financial indicators also do not speak in favor of cars as a whole. At the end of the last year, the company’s revenue from car sales decreased by 10%, while other income sources grew.