by Tesla’s Transformation and New Challenges
Over the past twenty years, Tesla has transformed from a small startup into one of the world’s largest automakers, effectively defining what a modern electric car looks like.
Competition from China and Strategy Shifts
However, as new competitors from China such as BYD approach, and Elon Musk divides his time between rockets, robots, and artificial intelligence, a former Stellantis executive suggested that Tesla might eventually abandon the automotive business entirely.
Sales Challenges and Forecasts
It’s no secret that the continuous sales growth that Elon Musk long promised for Tesla hasn’t been going according to plan lately. At one stage, Musk stated that Tesla could grow so fast that it would sell up to 20 million cars per year. However, its sales peaked at 1.808 million in 2023 and then fell to 1.789 million in 2024. This year, its sales are forecast to be approximately 1.6 million.
Potential Shift in Company Focus
Carlos Tavares believes that Musk might shift Tesla’s focus to humanoid robots. Tesla’s sales have been declining for two years and may not recover anytime soon. The former Stellantis executive warned that Tesla is losing to BYD in efficiency.
We cannot rule out that at some point he will decide to leave the automotive industry to refocus on humanoid robots, SpaceX, or artificial intelligence. Elon Musk will leave the automotive industry.
Questions About Billion-Dollar Rewards
Tavares’s comments come just as Tesla’s board members have begun actively lobbying shareholders to support Elon Musk’s record-breaking $1 trillion compensation package ahead of the November 6th vote. To receive the $1 trillion, Musk would have to achieve significant financial goals, and Tavares does not believe they will be met.
The loss of Tesla’s market value will be colossal, as this valuation is simply stratospheric. I am not sure that Tesla will even exist in 10 years. It is an innovative group, but they will be defeated by BYD’s efficiency.
Potential Changes in Business Model
The idea that Tesla might move away from car manufacturing towards humanoid robots or other projects is not entirely impossible, although Tavares’s experience does not make him the most convincing prophet. His own tenure at Stellantis ended abruptly last year due to internal disputes. Moreover, he suggested that Stellantis itself might disintegrate due to cultural and strategic differences between its Italian, French, and American divisions, indicating Tavares’s consistency in predicting upheavals.
Predictions about Tesla’s future remain a subject of intense debate among experts, especially given the rapid changes in the automotive industry and growing competition from Asian manufacturers. The company’s success may depend not only on technological innovation but also on its ability to adapt to new market conditions and maintain focus on key business areas.
