Elon Musk is years behind on his ambition to render Tesla’s cars fully autonomous. But he is now saying that he is willing to bet the company’s profit margins on making it happen.
Musk said on a conference call last week that Tesla has the wherewithal to sell cars at “zero profit” and then earn immense sums later off driverless software.
The trouble with that for investors? His predictions since at least 2019 that autonomous Teslas are just around the corner have not panned out.
“We are the only ones making cars that technically we could sell for zero profit for now, and then yield actually tremendous economics in the future through autonomy,” Musk said April 19. “I am not sure how many of you will appreciate the profundity of what I have just said, but it is extremely significant.”
The challenge Musk has had turning driverless visions into reality is not stopping him from going forward with markdowns that threaten to set off a price war. The company has lowered the cost of its top-selling Model Y by 29 percent in the span of just a few months.
That has dented the company’s margins and spooked investors concerned about deteriorating profits.