Tesla's Musk unveils robot taxis to fanfare and skepticism

Excitement for the event was evident on social media, with screenshots of invitations and speculation about what might be announced. But investors and analysts have pointed to challenges with the technology and tempered their expectations.

Musk's plan is to operate a fleet of self-driving Tesla taxis called Cybercabs that can hail passengers via an app. Individual Tesla owners can also earn money with the app by registering their vehicles as robotaxis.

An eye will also be on the progress the company has made with partial automation software, which it markets as “Full Self-Driving,” and which the company's observers expect to be the basis for its robotic axes.

Musk could also provide details on cheaper versions of Tesla's current electric vehicles, as well as updates on his humanoid robot Optimus.

MISSED PROMISES

Musk said in 2019 that he was “very confident” that the company would have operational robotaxis by next year. After missing promises, Musk shifted his focus to vehicle development this year after scrapping plans to build a smaller, cheaper car that was widely seen as essential to counter slowing demand for electric vehicles.

Tesla is at risk of experiencing its first decline in deliveries this year as purchase incentives have failed to attract enough customers to its aging range of electric vehicles. Drastic price cuts, which were intended to compensate for the high interest rates, also reduced profit margins.

Complicated technology and strict regulation have resulted in billions of dollars in losses for other companies trying to corner the robotaxi market, forcing some to close shop.

Unlike expensive hardware like lidar that others use, Musk relies only on cameras and AI to run FSD to keep costs down. But FSD, which requires constant driver attention, has faced regulatory and legal scrutiny with at least two fatal crashes involving the technology.

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Akash reports on technology companies in the US, electric vehicle manufacturers and the space industry. His reporting typically appears in the Auto & Transportation and Technology sections. He holds a postgraduate degree in Conflict, Development and Security from the University of Leeds. Akash's interests include music, football and Formula 1.