UBER Technologies and Lyft have climbed in early trading, after Tesla’s Elon Musk offered few details on the carmaker’s plans for a self-driving vehicle service that could compete with ride-hailing.
Uber’s stock jumped as much as 5.4 per cent and Lyft’s advanced up to 3.7 per cent in premarket trading on Friday (Oct 11), after Musk’s unveiling of a robotaxi called Cybercab on Thursday in California. Tesla shares traded down as much as 6.9 per cent.
Musk’s debut of the two-seat prototype and a Robovan concept that can transport as many as 20 people let down Tesla investors who were hoping for more specifics.
While he said Cybercab production may start in 2026 and cost less than US$30,000, the chief executive officer cautioned that he tends to be overly optimistic.
“We consider the event a best-case outcome for Uber,” said John Colantuoni, an equity analyst at Jefferies with a “buy” rating on the stock.
In a report referring to Tesla’s taxi as “toothless”, he noted that the company did not provide verifiable evidence of progress towards automated-driving features, or quantify how many robotaxis it plans to make.
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Thursday had been viewed as a “make or break night” for Tesla shares, said Mike O’Rourke, chief market strategist at JonesTrading.
The event had already been delayed by two months, and Tesla was under pressure to justify its high valuation and prove it can lead the industry in autonomous vehicle technology.
Uber CEO Dara Khosrowshahi offered a sober take on the future of autonomy earlier this week, saying he did not see robotaxis becoming a significant portion of the company’s fleet for years.
The technology is still not quite there, regulators are wary and costs will not be competitive for a while, he said.
“Safety is job number one,” he added. “We will then, I would say in the next three to seven years, start to focus on economics.” BLOOMBERG
