Tesla set to unveil its Cybercab in move Musk hopes will steer company into new era

Tesla is set to hold a live event Thursday titled “We, Robot” where the company is expected to unveil a fully autonomous vehicle that CEO Elon Musk has called a “Cybercab.”

A self-driving taxi that can collect passengers and drive them to their destinations safely is an idea Musk has been toying with for several years. Some analysts say if the new robotaxi works, it could vault the electric vehicle company into a new era of automotive innovation.

Still, many critics are skeptical Tesla can sell safe, driverless cars at scale due to the numerous state and federal safety regulations it faces over its current driver-assistance technology. But Musk himself is confident, posting on X --- the social network he owns --- that “this will be one for the history books.”

“We, Robot,” was originally scheduled for Aug. 8, but was pushed back after Musk asked for an “important design change” to the vehicle. In a post on X, a link to the event’s livestream is captioned: “[t]he future will be streamed live.” Here’s what to expect from Tesla’s robotaxi event:

A Hollywood Production

“We, Robot” is set to kick off at the Warner Bros. Discovery movie studio backlot in Burbank, California, at 7 p.m. It’s the place where blockbuster movies like “Batman” and TV shows like “Friends” were filmed.

“We’re talking about literal Hollywood here,” says Patrick George, editor in chief of InsideEVs.

The lot contains plenty of space, prompting some to speculate that it will be used to demonstrate the car’s self-driving capabilities in real time. But it’s far from representative of a real-world driving environment, and that’s cause for skepticism, says George.

“I have to wonder how authentic it is. Like, if Tesla had really cracked fully self-driving cars, why not do this demonstration in downtown Austin, where they’re located, which is also choked with traffic, or downtown Los Angeles?” he tells ABC Audio.

The “Cybercab”

Musk says the Cybercab would operate similarly to a traditional taxi service. Instead of drivers, the cars will be autonomous, and what’s more, Tesla owners will be allowed to send their own cars off to collect fares when they’re not using their vehicles.

In June, at Tesla’s annual shareholder meeting, dubbed “Cyber Roundup 2024,” Musk said that his vision for a driverless taxi service is similar to Uber, the ridesharing service, and AirBnB, the vacation rental app.

“So, like, they’ll be some cars that Tesla owns itself, in kind of an Uber fashion. But then for the fleet that is owned by our customers, there will be like an AirBnB thing,” Musk told investors. “You can add or subtract your car to the fleet whenever you want.” “It almost sounds like an Uber-type application,” says George, “that would allow these specialized vehicles or, who knows, maybe even passenger Teslas, to operate on this robotaxi network.”

But even ahead of Thursday night’s event, Musk’s claims have caused figures in the rideshare industry to raise their eyebrows. In a podcast interview earlier this year with venture capital investor Logan Bartlett, Uber CEO Dara Khosrowshahi expressed skepticism that a “Tesla owner or owner of any other car is going to want to have that car be ridden in by a complete stranger.”

Wedbush Securities Tech Analyst Dan Ives says Musk is hoping the Cybercab can achieve two goals. First, the data collected from autonomous taxi rides could lay the groundwork for other projects he’s working on, such as the humanoid Tesla robot dubbed “Optimus.” In addition, Ives says, Musk is also aiming to create a durable revenue stream from rideshares so the company doesn’t have to rely on people buying new cars every year.

“It's not just selling a car and the margins they meet there. It's about software, full self-driving, autonomous and ultimately their views from a data perspective that will ultimately drive robotics, Optimus, and other technology.”

“That’s where he sees everything going, that’s what he thinks will turn Tesla into a multitrillion-dollar company, and I think power the many other ventures that he has running,” says George.

Tesla’s Bumpy Autonomous Past

Tesla currently offers semi-autonomous driving technology, called “Autopilot,” which can keep the car centered in its lane, as well as speed up and slow down with highway traffic. In addition, Tesla buyers can opt for the $8,000 “Full Self Driving” option, which is designed for lower speed urban driving. The company claims Full Self Driving makes the car “able to drive itself almost anywhere with minimal driver intervention,” but also stipulates that the feature “require[s] active driver supervision and do[es] not make the vehicle autonomous.”

“It still requires a human minder, a human operator. Like, it’s not really full self-driving,” says George.

Earlier this year, a National Highway Traffic Safety Administration analysis of more than 900 crashes in which Autopilot is thought to have been engaged, found that the system likely contributed to 467 of them, resulting in 13 deaths. NHTSA is also investigating whether a massive recall of nearly every Tesla ever made went far enough in addressing the safety of Autopilot.

Tesla did not respond to a request for comment about NHTSA's findings.

“This all speaks to what a risky bet this is for Tesla,” says George. “They’re kind of going all in on a very unproven technology and are making very clear that’s what they see the future as. And they’ve got to deliver.”

The financial stakes

Earlier this month, Tesla posted better-than-expected third quarter earnings. The company said it delivered nearly 463,000 vehicles globally in Q3, up from just over 435,000 during the same period last year.

Still, shares slumped on the news, as investors eye Tesla’s shrinking market share amid increasingly competitive electric vehicles from other automakers. George says that’s why the stakes are high for Tesla ahead of the robotaxi event.

“It may also be possible that this is less about selling a product to future owners, and more about convincing Wall Street that he’s on the right track to keep Tesla’s stock price high,” says George, adding, “they’ve been kind of alluding to this as being right around the corner for 10 years now, and I think that more and more we’re starting to see that that check is due.”

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