Tesla Cybertruck Unveiled in Downtown Austin

With Tesla's biggest event just a day away, no major US index has risen less than Tesla. Today, Tesla closed up 0.26% at $357.01, while Space closed down 1.07% at $140.71. The Cybertruck launch event is scheduled for September 3rd in Austin, US time, where the public will get their first ride in the car without a steering wheel or pedals. Tesla has not provided specific details about the event throughout this week.

Today, the market recovered yesterday's losses, with the S&P rising 0.46%, Nasdaq 0.45%, and Dow 0.56%. One of the two factors weighing on the market was the Middle East situation, as the US Central Command announced it had struck Iranian Revolutionary Guard Corps air defense systems, radar, and naval assets, marking the second such attack this week. Brent crude rose 4% to $95.29 per barrel, marking three consecutive trading days of rising oil prices.

Currently, the probability of the US raising its benchmark interest rate by 0.25% in September is 67.9%, double the 34.7% from a week ago. Despite expectations of a rate cut after the emergence of a new Fed Governor, the likelihood of an increase is growing. If rates rise, companies that pull future profits forward may be hit first, and Tesla is currently in that position. The employment report is scheduled for release on Friday, September 4th, US time, and could significantly influence the direction of interest rates, making it a key report to watch.

Uber CEO Dara Khosrowshahi announced plans to cut 10% of its workforce in a letter to employees. Approximately 3,300 employees, or 9.7% of Uber's global workforce of about 34,000, will be reduced by the end of 2025. This is the largest round of layoffs at Uber since COVID-19. Uber operates in over 70 countries, and this reduction appears to be a restructuring of specific departments rather than an overall headcount cut.

Uber stated that the criterion for these layoffs was 'how far from the CEO' an employee is. They announced a 20% reduction for employees seven or more levels below the CEO, which differs from typical departmental or job-specific layoffs. Furthermore, they will limit remote work to about 1% of the total workforce and consolidate employees in hubs like New York and San Francisco. This is interpreted as a structural transformation rather than a business cessation. Uber reported strong financial results in Q2, with operating profit of $1.9 billion and net income of $2.4 billion.

The reason Uber, despite strong earnings, initiated restructuring, as stated by the CEO, is organizational complexity. As the business grew, the time spent on coordination increased, and accountability became unclear. Uber expects to save approximately $1.7 billion annually from these layoffs, which will provide capital for future investments, including over $10 billion in autonomous driving. This investment is interpreted not as an effort to build new autonomous vehicles but to integrate autonomous vehicles into the Uber app. Uber seems to be proactively responding to the significant impact autonomous driving would have on its current business model if it becomes commercialized.

The market reacted positively to Uber's decision, with the stock rising over 2% intraday. However, the next day, speculation arose that another company could threaten Uber with a completely new approach. That company is Tesla, which is registering vehicles with the Texas state Department of Motor Vehicles for autonomous driving. To commercially operate autonomous vehicles in Texas, state pre-authorization and vehicle registration are essential, and this system began on May 28th this year.

The registration status of Tesla robotaxis in Texas became trackable from May 28th, with the initial number of registrations in late May being 42. This is a significant increase compared to last June, when about 10 Model Y robotaxis operated with safety drivers in the passenger seat in Austin. While still a small number compared to Waymo's 736 registered vehicles, Tesla is rapidly increasing its robotaxi registrations. On August 27th alone, 79 Model Ys were registered, and the operating area expanded by 50%. On August 31st, the Austin operating area expanded by another 9%.

With the recent registration of 106 additional Model Ys, the total number of Tesla robotaxis registered in Texas has reached 420, a tenfold increase from 42 in late May. However, when 45 Cybertrucks were registered on August 31st, they accounted for 14% of the total 314 registered vehicles. Now, with 420 total, Cybertrucks still number 45, reducing their proportion to 10.7%. All 106 additional registrations are reported to be Model Ys, which is notable given the impending Cybertruck launch event. Tesla plans to hold the Cybertruck event in downtown Austin, not at the Giga Texas factory.

The reason Tesla is holding the event in downtown Austin instead of the Giga Texas factory stems from criticism received during the 'Re Robot' event on October 10, 2024. At that time, 20 concept Cybertrucks drove autonomously within the studio at Warner Bros. Studios in Burbank, California, carrying attendees. This controlled environment autonomous driving drew media criticism, causing Tesla's stock to drop 9% at market open. Now, 23 months later, Tesla appears to have adopted a strategy to counter such criticisms.

Tesla announced that it would use actual registered vehicles in downtown Austin, not a set, to carry members of the public in vehicles without steering wheels or pedals. Texas opened its doors to autonomous driving operations with a Senate bill in 2017, and in 2021, a House bill was passed, clarifying that vehicles designed for fully autonomous driving could eliminate traditional devices like steering wheels or brake pedals. This means the legal basis for the Cybertruck to actually operate on roads was established five years ago. In the past, road events were not possible due to a lack of legislation, but now that all laws are in place, autonomous driving events in the heart of downtown Austin are legally permissible. This is the biggest difference from the event two years ago.

Similar legislative amendments are emerging in Europe. French Minister of Transport, Philippe Tabarot, posted a photo of himself meeting virtually with Elon Musk on his X account, stating that French authorities had been working with Tesla on technical control operations for several months. He also announced that Tesla would begin road testing two FSD vehicles. Surprisingly, Minister Tabarot was the very person who denied FSD approval six weeks prior, on July 22, citing safety concerns. Currently, there are approximately 260,000 FSD hardware-equipped Tesla vehicles in France, but FSD cannot be used due to lack of government approval. While it remains uncertain if France will approve Tesla FSD in the European vote scheduled for October 6th, the fact that the Minister of Transport is directly engaging with Elon Musk in a positive manner is very encouraging.

Andrew Perkerko of Morgan Stanley, in a note about Tesla, maintained a 'neutral' investment rating and set a price target of $400. He predicted that if the number of actual road-going vehicles at tomorrow's Cybertruck event is small, the stock could decline, but conversely, if many Cybertrucks operate in the city, the stock could perform well. Currently, there are about 45 Cybertrucks registered in Texas, and even if they operate all day in Austin, the revenue generated would be very small compared to Tesla's quarterly sales.

Looking at actual cases of using robotaxis in Austin, the fare shown on the robotaxi app for the same destination was $14.17. During the same time, Uber X was $22.40, and Uber Comfort was $25.44. Even with a 5% discount, Uber's prices were much higher than Tesla's robotaxi, specifically about 36.7% higher for Uber X and 44.3% higher for Comfort. When compared to pre-discount prices, the difference widens to 47.5%. This means a difference of $8 to $11, or over 10,000 Korean Won, in taxi fares. This difference arises because Uber fares include the driver's share, while robotaxis do not have a driver, thus eliminating that cost. This is due to a completely different cost structure, and while the current number of 45 units is small, production is expected to accelerate in an S-curve once it fully ramps up.

If Tesla robotaxis become widespread, Uber will be hit the hardest. Uber announced it would invest funds saved from 3,300 layoffs into autonomous driving, but some analysts believe this decision may be too late. Waymo also argues it will not succeed against Tesla robotaxis. However, if Tesla robotaxis maintain their current low or similar fares, Uber and Waymo will inevitably face significant impact. While Tesla has room to adjust fares after official service launch, if it maintains prices significantly lower than Uber or Waymo, it will no longer be a match in terms of vehicle scale or fare competitiveness.

Some investors are calling tomorrow the 'iPhone moment' or 'ChatGPT moment.' Personally, I believe September 3rd, US time, will be the day Tesla officially declares its transition from simply a car manufacturing and selling company to a service-selling company. While this declaration may not immediately lead to significant profits, it will be a crucial day when the company's business role completely changes. Elon Musk already stated at the initial Cybertruck unveiling in October 2024 that the target price for the Cybertruck was below $30,000 and emphasized twice that individual sales of the Cybertruck could happen before 2027 while maintaining the $30,000 base price and customer delivery.

It will be important to see if there is any discussion about individual sales of the Cybertruck at this event. All eyes are on what Tesla will announce. Tesla's Cybertruck event is scheduled to begin at 6:45 AM KST on Friday. We will be covering it live through today's Tesla News Live broadcast.

That concludes today's Tesla News. If you found this video helpful, please subscribe, like, and turn on notifications. Have a great day, and we'll see you tomorrow for the Tesla News Live broadcast. Special thanks to Teslatopia Jeju for their sponsorship.