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GM CFO admits electric vehicle production ramp is still a struggle

The Cadillac LYRIQ, which has been dubbed “crypt-quiet” and “the quietest car I can remember driving” by the press, sports an electric AC compressor mounting bracket made of Vydyne AVS, which effectively helps damp that component’s vibrations at the source while also providing structural support. Credit: APM

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While speaking at a J.P. Morgan investor conference, General Motors (GM) Chief Financial Officer (CFO) Paul Jacobson stated that the veteran automaker is still struggling with its electric vehicle production ramp. These included vehicles that were previously released, such as the Cadillac Lyriq and BrightDrop vans. 

As per the CFO, Cadillac Lyriq production was at more than 1,000 units in July, far below the company’s expectations. Jacobson noted that General Motors has been affected by an issue with the company’s assembly of its electric vehicle battery modules, as noted in a Reuters report. Interestingly enough, this challenge was mentioned last week by GM CEO Mary Barra.

In early 2022, GM stated that it is expecting to build about 25,000 Lyriq units at its Spring Hill, Tennessee, plant. This target was not met, with GM delivering less than 2,400 Cadillac Lyriq SUVs to customers instead. 

But while GM’s electric vehicle endeavors are challenging, the CFO noted that there is a bright spot in the company’s projects. This came in the form of Cruise, GM’s autonomous robotaxi service that’s currently deployed in cities such as San Francisco. The CFO noted that Cruise is entering a “big phase of operational expansion” with more than 400 robotaxis on the road. 

Jacobson stated that Cruise has “largely solved all the technology challenges” and that the unit is still aiming to hit a revenue of $1 billion in 2025. The autonomous robotaxi unit also expects to grow its margins and reduce its costs as the service ramps further. 

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Maria--aka "M"-- is an experienced writer and book editor. She's written about several topics including health, tech, and politics. As a book editor, she's worked with authors who write Sci-Fi, Romance, and Dark Fantasy. M loves hearing from TESLARATI readers. If you have any tips or article ideas, contact her at maria@teslarati.com or via X, @Writer_01001101.

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Elon Musk gives update on Tesla Optimus progress

Tesla is “working hard” to get Optimus production scaled, Elon Musk said.

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Credit: Tesla

Elon Musk says Tesla is working hard to scale what will end up being its biggest product in his eyes: Optimus.

Tesla Optimus is the company’s humanoid robot project, which was first announced several years ago but has gained more relevance and become a larger focus over the past year.

Tesla truly had its big breakout with Optimus last year at its “We, Robot” event in October, where it was used to serve drinks, provide entertainment, and mingle with attendees.

Tesla’s next-gen Optimus prototype with Grok revealed

However, it has been a challenge for Tesla to truly scale Optimus and, although it has huge plans for production numbers, certain parts of the project have proven to be more difficult than others.

One of the most notable things is that of its hands, as Tesla wants them to be nimble enough to thread a needle.

This has proven to be very difficult.

Scaling production and refining manufacturing are also likely challenges. Musk says Tesla is “working hard on scaling Optimus,” something that is a crucial issue to solve as the project is a major contributor to the company’s future.

Musk said:

Musk has made some pretty tremendous predictions for Optimus and how important it could be to Tesla in the future.

Earlier this month, he said Optimus will make up about 80 percent of the company’s value in the future. In January, he also noted during Tesla’s Q4 2024 Earnings Call that Optimus would be “overwhelmingly the value of the company.”

Elon Musk details Tesla’s road to selling Optimus and Robotaxi affordably

He has not only talked about Optimus’s importance in terms of money and revenue. He also said it would be “the biggest product of all-time by far,” because of its ability to revolutionize human life. He said it would be like “having your own personal C-3PO and R2-D2.”

Summary Table of Estimations

Aspect
Musk’s Estimation
Date/Context
Implication for Tesla
Valuation Share
~80% of total company value
Sep 2025 X post; Jan 2025 earnings
Shifts focus from EVs to robotics as primary growth engine
Overall Valuation
Up to $25 trillion (Optimus-driven)
Mid-2024 interview
~34x current cap; exceeds U.S. GDP equivalent in profits
Market Size
>10 billion units globally
Aug 2024 interview
Universal adoption for labor/personal use
Product Ranking
Biggest product ever; > FSD value
Mar 2025 statement; Apr 2022
Transforms Tesla into AI/robotics leader
Unit Price
~$20,000 (high-volume target)
Nov 2024 X post
Enables affordability for billions of users
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Elon Musk

Tesla pleads with Trump White House not to bail on crucial climate standards

It suggested that abandoning the standards “would give a pass to engine and vehicle manufacturers for all measurement, control, and reporting of GHG emissions for any highway engine and vehicle.”

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President Donald J. Trump purchases a Tesla on the South Lawn, Tuesday, March 11, 2025. (Official White House Photo by Molly Riley)
Credit: Tesla

Tesla pleaded with the Trump White House not to bail on crucial climate standards that would help keep vehicle emissions in check, warning of human dangers related to greenhouse gases.

Tesla wrote that the Environmental Protection Agency’s (EPA) recent proposal to roll back standards for tailpipe emissions would be a major setback in the fight to limit damage to the climate.

It suggested that abandoning the standards “would give a pass to engine and vehicle manufacturers for all measurement, control, and reporting of GHG emissions for any highway engine and vehicle,” Reuters said in its report.

Trump has been a critic of environmental standards, and earlier this week, during a speech with the U.N., said that climate change was “the greatest con-job ever perpetrated on the world, in my opinion.”

Tesla’s tone on the potential rollback of climate standards was countered by that of General Motors, Toyota, Volkswagen, and “nearly all other major automakers,” who requested the EPA delay the emissions goals.

Tesla stands to gain a lot from the emissions push. Other automakers simply cannot compete with Tesla’s tech, charging infrastructure, or self-driving program, and they have a significant advantage as they started developing EV tech more than a decade ago.

Legacy automakers, on the other hand, have continued to develop EVs, but have not managed to manufacture anything of extreme interest to most car buyers.

Individually, they have not dented Tesla’s market share in the U.S., but collectively, because of more offerings and improvements to their lineups, they have managed to take some of Tesla’s sales away.

It’s taken all of them to truly compete with Tesla in the big picture. However, the other companies still need to rely on combustion engine vehicles, at least in the short term, to generate revenue.

Since these companies are not meeting emissions targets, they are required to pay Tesla for compliance credits, which the company generated $2.8 billion in revenue from last year.

GM to pay $145.8 million fee for excess emissions

Tesla said in its letter that the EPA’s consideration of rolling back standards is destructive to the innovation of the automotive industry:

“[It] undermines the stability of this program, diminishes the value of performance-based incentives that electric vehicle manufacturers accrue under the standards, and creates an uneven playing field – reducing the inducement for investment in vehicle innovation.”

With President Trump’s skepticism on the issue of vehicle emissions, things don’t look like they will go in Tesla’s favor with this particular request.

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Investor's Corner

Tesla gets new Street-high price target with high hopes for autonomy domination

“We believe Tesla could reach a $2 trillion market cap early 2026 in a bull case scenario and $3 trillion by the end of 2026 as full-scale volume production begins of the autonomous and robotics roadmap.”

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Credit: Tesla Europe and Middle East | X

Tesla (NASDAQ: TSLA) received a new Street-high price target from Wedbush’s Dan Ives today, who cited high hopes for the company’s prowess in the autonomous sector.

Ives boosted his price target from $500 to $600 today, reflecting the firm’s view that “an accelerated AI path for the company is now on the horizon and investors are underestimating the transformation underway at the company.”

In a new note written to investors on Friday, Ives cited that Tesla’s next stage of growth has arrived as Elon Musk has re-entered his role as a “wartime CEO,” which gives the company a huge advantage over its competitors.

Musk, when fully committed to Tesla, does his best work, and Ives believes the company’s mark on the autonomous sector will continue to expand with the help of the Trump White House.

He wrote:

“Musk is now driving Tesla into its next stage of growth as ‘wartime CEO,’ and we expect Robotaxis to be rolled out aggressively to over 30 US cities within the next year. We estimate the AI and autonomous opportunity is worth at least $1 trillion alone for Tesla, and we fully expect under a Trump White House over the coming yea,r these key initiatives will now get fast-tracked as the federal regulatory spiderweb that Musk & Co. have encountered over the past few years around FSD/autonomous clears significantly under Trump. Trump wants the US to stay ahead of China in this AI Arms Race, and autonomous is a key factor in who wins AI….with Tesla playing a major role on Robotaxis.”

Most of the note focused on the long-term outlook for Tesla, which is where some of the most drastic claims were made, including ones that estimated a monstrous valuation for the company moving forward.

Ives said Wedbush is under the impression that Tesla could reach a $2 trillion market cap as early as the beginning of 2026 and a $3 trillion valuation by the end of the year. This growth will be primarily driven by the AI portion of the company’s projects:

“We believe Tesla could reach a $2 trillion market cap early 2026 in a bull case scenario and $3 trillion by the end of 2026 as full-scale volume production begins of the autonomous and robotics roadmap. The AI valuation will start to get unlocked in the Tesla story, and we believe the march to an AI-driven valuation for TSLA over the next 6-9 months has now begun in our view with FSD and autonomous penetration of Tesla’s installed base and the acceleration of Cybercab in the US representing the golden goose for Musk & Co.”

In the near term, the only true issue at hand is deliveries, which Tesla should likely have a strong quarter thanks to the removal of the $7,500 EV tax credit. Ives says he expects a beat of Q3 numbers, driven by an “improving demand out of China.”

He also said that while he expects this quarter to be strong, Tesla should aim to return to a run-rate of 500,000 deliveries every quarter, equating to approximately 2 million units per year. This will be driven by new, more affordable models, with the tax credit going away:

“On the near-term delivery front we are seeing a stabilization of demand globally that should enable Tesla to beat the Street’s 3Q delivery number with improving demand out of China. Getting back to a ~500k quarterly run-rate will be important as Tesla now looks to introduce new models to its customer base in 2026. There continues to be weak pockets in Europe but we believe Tesla is now starting to see signs of improvement in demand with a stronger growth trajectory into 2026.”

Tesla shares are up over 1.7 percent so far today, trading at around $430.

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