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Tesla’s rise is unmasking Japan’s risk of being left behind
Tesla has been one of the automakers that have actually managed to thrive this year despite the pandemic. And as the electric car maker continues its rise, it is becoming pretty clear that legacy automakers who refuse to ride the transition to renewable transport risk getting left behind. This is the case even if the automaker in question is Toyota, the previous Number 1 carmaker by market cap.
Tesla only sells a fraction of the vehicles sold by Toyota every year, but the electric car maker has a market cap that is around $370 billion now. That’s roughly equivalent to the annual gross domestic product of Hong Kong, and it’s nowhere near reaching its full potential yet. TSLA bulls like Cathie Wood of ARK Invest note that Tesla’s Autopilot tech and data are pretty much ignored for now, and billionaire investor Ron Baron argues that Tesla Energy has as much potential as the company’s EV business.
Tesla is showing rapid growth across the globe, and this is no more evident than in China, a country that is currently home to the company’s first offshore Gigafactory in Shanghai. Thanks to this, as well as grassroots efforts that make Teslas widely supported by the Chinese government, the company is poised to reap benefits in the country. In Japan, however, things could not be more different. Tesla may have close ties with Japan thanks to its longtime battery partnership with Panasonic and its previous deal with Toyota, but today, the far east country’s mainstream vehicle market remains out of reach for the Silicon Valley-based maker.
Despite this, William Pesek, an award-winning Tokyo-based journalist and author of “Japanization: What the World Can Learn from Japan’s Lost Decades,” argues that Tesla’s rise across the globe further highlights how Japan’s auto market is still stuck in first gear. In an article on the Nikkei Asian Review, Pesek noted that what Japan is so far missing in the Tesla picture is the fact that Elon Musk does not sell cars. While Japan is still busy focusing on hardware, Tesla is already exploring software, allowing Elon Musk to pretty much sell than iPhone on wheels. This ensures that Tesla is capable of embracing the next generation of motoring.
“What Toyota long missed about Musk is that he is not selling cars. He is selling an iPhone with wheels. The vehicle itself is merely a medium to market the software undergirding the iTunes-like community that he is building. The data Tesla collects from users, their environs, interests, tendencies, travel habits and the range of behaviors will arguably be more valuable than the engines and high-performance batteries powering them. This enables Tesla to hone the customer experience, while discerning where the market will veer next,” Pesek wrote.
Perhaps what Japan really needs right now is to embrace the fact that sometimes, disruption is a necessary evil during times of transition. Strictly speaking, legacy automakers like Toyota should have no problem catching up to Tesla by, say 2025, due to their massive talent pool and resources. This does not seem to be case, however, as carmakers like Toyota have a tendency to focus more on legacy than innovation. Toyota has refined its car making processes through decades of refinements, and its global supply chain helps create millions of jobs. This, while noble in a way, is a weight that a company like Tesla simply does not have.
Tesla moves fast, fails fast, and innovates fast. The company’s vertical integration allows it to implement changes and improvements as soon as they are ready. Granted, automakers like Toyota could not adopt such changes overnight, but efforts must be done to increase innovation. This is something that Japanese companies are capable of doing, as seen in the continued efforts of Panasonic’s and its longtime battery partnership with Tesla in Gigafactory Nevada. Perhaps companies like Toyota, Nissan, Honda, and the other premier Japanese carmakers could do the same.
For now, it appears that Elon Musk has already won. So great is the gap in the electric vehicle market that newcomers like Lucid Motors and Rivian Automotive seem to have a better chance at catching Tesla than legacy carmakers. But amidst this threat of being permanently left behind, veterans in the auto market could also see this time as an opportunity to change and raise their electric vehicle game. If there’s anything that Tesla’s rise shows, after all, it is that renewable solutions are the new standard, and they are here to stay.
Elon Musk
Tesla and xAI team up on massive new project
It is the latest move by a Musk company to automate, streamline, and reduce the manual, monotonous, and tedious work currently performed by humans through AI and robotics development. Digital Optimus will be capable of processing and actioning the past five seconds of a real-time computer screen video and keyboard and mouse actions.
Elon Musk teased a massive new project, to be developed jointly by Tesla and xAI, called “Digital Optimus” or “Macrohard,” the first development under Tesla’s investment agreement with xAI.
Musk announced on X that Digital Optimus will “be capable of emulating the function of entire companies.”
Macrohard or Digital Optimus is a joint xAI-Tesla project, coming as part of Tesla’s investment agreement with xAI.
Grok is the master conductor/navigator with deep understanding of the world to direct digital Optimus, which is processing and actioning the past 5 secs of…
— Elon Musk (@elonmusk) March 11, 2026
It is the latest move by a Musk company to automate, streamline, and reduce the manual, monotonous, and tedious work currently performed by humans through AI and robotics development. Digital Optimus will be capable of processing and actioning the past five seconds of a real-time computer screen video and keyboard and mouse actions.
Essentially, it will be an AI version of a desk worker in many capacities, including accounting, HR tasks, and others.
Musk said:
“Grok is the master conductor/navigator with deep understanding of the world to direct digital Optimus, which is processing and actioning the past 5 secs of real-time computer screen video and keyboard/mouse actions. Grok is like a much more advanced and sophisticated version of turn-by-turn navigation software. You can think of it as Digital Optimus AI being System 1 (instinctive part of the mind) and Grok being System 2. (thinking part of the mind).”
Its key applications would be used for enterprise automation, simulating entire companies, high-volume repetitive tasks, and potentially, future hybrid use with the Optimus robot, which would handle physical tasks, while Digital Optimus would handle the clerical work.
The creation of a digital AI suite like Digital Optimus would help companies save time and money, as well as become more efficient in their operations through massive scalability. However, there will undoubtedly be concerns from people who are skeptical of a fully-integrated AI workhorse like this one.
From an energy consumption perspective and just a general concern for the human workforce, these types of AI projects are polarizing in nature.
However, Digital Optimus would be a great digital counterpart to Tesla’s physical Optimus robot, as it would be a hyper-efficient addition to any company that is looking for more production for less cost.
Musk maintains that there is no other company on Earth that will be able to do this.
Elon Musk
Tesla China posts strong February wholesale growth at Gigafactory Shanghai
The update was shared by Tesla observers on social media platform X, citing monthly China Passenger Car Association (CPCA) data.
Tesla China sold 58,599 vehicles wholesale in February, reflecting strong year-over-year growth. The figure includes both domestic deliveries in China and vehicles exported to international markets.
The update was shared by Tesla observers on social media platform X, citing monthly China Passenger Car Association (CPCA) data.
Tesla’s February wholesale result represents a 91% increase year over year, compared with 30,688 vehicles in February 2025. Month over month, the result was down 15.2% from January, when Tesla China recorded 69,129 wholesale units.
The February total reflects combined sales of the Model 3 and Model Y produced at Gigafactory Shanghai. The facility produces the two vehicles for both domestic sales and exports.
Gigafactory Shanghai continues to serve as Tesla’s primary vehicle export hub, supplying vehicles to markets across Asia and Europe. Data compiled by Tesla watchers shows that 18,485 vehicles were sold domestically in China in January 2026, while exports accounted for 50,644 units during the same period.
Tesla has also been extending financing programs in China as it pushes to strengthen domestic demand. The company recently extended its seven-year ultra-low-interest and five-year interest-free financing programs through March 31, marking the second extension of the promotion this year.
The financing initiative was first introduced on January 6 as a strategy aimed at offsetting higher ownership costs ahead of China’s planned 5% NEV purchase tax in 2026. The promotion was originally scheduled to expire at the end of January before being extended to February and then again through the end of the first quarter.
Tesla’s efforts come amid growing competition in China’s EV market. According to data compiled by CNEV Post, Tesla’s 2025 retail sales in China reached 625,698 vehicles, representing a 4.78% year-over-year decline. Part of that decline was linked to the Model Y changeover to its updated variant in early 2025, which temporarily reduced deliveries during the transition period.
News
Tesla Model Y L spotted on transport trucks in Australia
One of the sightings was reported along Victoria Parade in Melbourne, and it showed multiple Model Y L vehicles on a transport carrier.
Tesla’s upcoming Model Y L has been spotted on transport trucks in Australia. Sightings of the six-seat extended wheelbase Model Y variant have been reported on social media platform X by members of the Australian Tesla community.
One of the sightings was reported along Victoria Parade in Melbourne, and it showed multiple Model Y L vehicles on a transport carrier.
The sighting follows earlier observations by Tesla enthusiasts in Sydney, where a covered vehicle believed to be a Model Y L was spotted at a Supercharger.
The Sydney sighting drew attention after observers noted that the vehicle’s tare weight appeared to match the ADR approval listing for the Model Y L, suggesting it could indeed be the extended wheelbase variant of the electric SUV.
Tesla has previously confirmed that the Model Y L will launch in Australia and New Zealand in 2026. The confirmation was reported by techAU following a media release from Tesla Australia and New Zealand.
The Model Y L expands the existing Model Y lineup with seating for six passengers. The vehicle features a longer body compared with the standard Model Y in order to accommodate a spacious second and third row.
Tesla has opted for a 2-2-2 seating configuration instead of a traditional seven-seat layout for the Model Y L. The design includes two individual seats in the middle row to provide easier access to the third row and additional passenger space.
Tesla Australia and New Zealand has also stated that the Model Y L will be covered under the company’s updated warranty structure beginning in 2026.
Tesla has not yet announced pricing or official range figures for the Model Y L in Australia.
Tesla and xAI team up on massive new project
Tesla China posts strong February wholesale growth at Gigafactory Shanghai
