After Tesla’s much-anticipated robotaxi unveiling fell short, CNBC’s Jim Cramer advised investors to hold off on making any decisions regarding the stock. He cautioned against buying Tesla at this time, but also discouraged shorting the stock, citing the danger of betting against CEO Elon Musk. While he praised the appearance of the robotaxi at the event, Cramer noted that there was a lack of detail to support the idea that Tesla should be treated as an autonomous driving business rather than just an electric vehicle maker. He ultimately recommended that investors stay on the sidelines for now.
Tesla had been seeking a win with the robotaxi event, especially after a series of weak quarters that had impacted the company’s stock earlier in the year. Despite gaining traction in the spring as Musk hinted at self-driving cars, Tesla’s stock took a hit after the unveiling. The event failed to provide tangible evidence of the technology behind the robotaxi, leading to doubts about its feasibility. Musk’s lack of details on cost and rollout timing further contributed to investor skepticism.
By the end of Friday, Tesla’s stock had dropped by 8.78%, reflecting the market’s disappointment with the robotaxi unveiling. In contrast, shares of rideshare companies Lyft and Uber surged, with the latter reaching a new all-time high. The concept of robotaxis had posed an “existential threat” to these companies, but the market’s response suggested that Tesla’s Cybercab may not be ready for practical use in the near future. Cramer pointed out that Tesla faces a challenge in the electric vehicle market, which has turned out to be smaller than anticipated. For Tesla to pivot successfully to self-driving cars, more specific details will be necessary.
Despite the impressive appearance of the robotaxi at the event, Cramer emphasized the need for substantive information to support Tesla’s transition to autonomous driving. The lack of details on costs and rollout timing left investors feeling underwhelmed, contributing to the negative market reaction. The event highlighted the importance of clarity and concrete plans in the development of new technologies, particularly in the competitive electric vehicle market. Cramer’s cautious approach to Tesla’s stock reflected the uncertainty surrounding the company’s future direction and its ability to fulfill its ambitious goals in the autonomous driving sector.
Cramer’s advice to investors to stay on the sidelines with Tesla underscored the uncertainty and skepticism surrounding the company’s robotaxi unveiling. While Musk’s vision for self-driving cars had generated excitement, the lack of concrete details and technological proof at the event raised questions about the feasibility of Tesla’s plans. The disappointing market reaction to the event served as a reminder of the challenges facing Tesla as it seeks to differentiate itself in a competitive and rapidly evolving industry. Investors will likely be watching closely for further developments and clearer strategies from Tesla in the autonomous driving space.
