Experts Question Tesla’s Sporty Two-Seater Robotaxi Concept
By Pavethran Batmanathen
Tesla’s recent unveiling of a robotaxi, designed as a sleek, two-seater, sporty coupe strikingly different from the typical taxi, which usually accommodates multiple passengers and luggage has left both investors and analysts scratching their heads.
At a much-anticipated event near Los Angeles on Thursday night, CEO Elon Musk introduced the prototype for Tesla’s new robotaxi, which he referred to as the “Cybercab.” According to Musk, production is set to begin around 2026, with each vehicle priced at under $30,000.
However, in true Musk fashion, he did not delve into details about how this two-seater vehicle would meet the practical needs of families heading to the airport or a night out, nor did he address whether it was designed for a niche market. The design and the absence of detailed financial projections sparked criticism from investors, leading to a 9% drop in Tesla’s stock price on Wall Street the following Friday.Jonathan Elfalan, the director of vehicle testing for the automotive website Edmunds.com, expressed confusion over the two-seater concept.
“When you think of a cab, you envision something that can carry more than two people,” he said. “The decision to make this a two-seater only is baffling.”Tesla did not respond to requests for comment on the matter.Industry experts pointed out that an ideal robotaxi design would likely resemble traditional taxis, offering spacious interiors, taller designs, and features like sliding doors to accommodate more passengers.
Although Musk did present a futuristic robovan concept capable of seating up to 20 people, he provided no information on when such a vehicle might become available.Sandeep Rao, a senior researcher at Leverage Shares, an investment firm managing around $1 billion in assets, including holdings in Tesla, commented that the market for two-door robotaxis would be extremely limited.
He cited data from analytics firm J.D. Power, which shows that two-door vehicles represent only 2% of car sales in the U.S., excluding SUVs and trucks.Musk did emphasize his goal of making robotaxis cheaper to operate than public transportation, predicting that the Cybercab could eventually have an operating cost of just 20 cents per mile.
However, he did not elaborate on how quickly Tesla could scale up production, secure the necessary regulatory approvals, or outperform competitors like Alphabet’s Waymo, which already operates robotaxi services in several U.S. cities.Waymo’s fleet includes about 700 Jaguar Land Rover vehicles that can seat four passengers, similar to the capacity of Amazon’s Zoox robotaxis.
Waymo’s former CEO, John Krafcik, weighed in on Tesla’s design, saying it seemed “more playful than serious,” and he pointed out the challenges a two-door configuration could present for elderly passengers or those with disabilities. Capturing a share of the still emerging and heavily regulated robotaxi market will be crucial for Tesla’s future.
Musk has repeatedly emphasized his vision of advancing Tesla’s autonomy efforts, suggesting that the robotaxi business could eventually propel the company’s valuation to $5 trillion, up from its current market cap of about $700 billion. Earlier this year, Musk abandoned plans to develop a smaller, cheaper vehicle amid cooling demand for electric vehicles, choosing instead to focus on autonomous driving technologies.
According to Sam Fiorani, vice president at AutoForecast Solutions, the concept of two-seaters as commuter vehicles has been around for decades but has never gained much traction. Fiorani believes Tesla will ultimately need to produce larger robotaxis to meet market demands.Blake Anderson, a senior investment analyst at Carson Group, which holds investments in Tesla, echoed these concerns.
He noted that if the Cybercab is intended to be a low-cost, mass-market model to expand Tesla’s appeal, the two-seat design seems counterintuitive. “It’s probably just a way for them to introduce something quickly to the market,” Anderson speculated.
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