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Tesla proudly hides ‘Octovalve’ insignia in Model Y, hints at next-gen thermal system
A number of the Tesla Model Y’s secrets are now coming to the surface, as auto veteran and teardown expert Sandy Munro continues his disassembly and analysis of the all-electric crossover. Among the most noteworthy of these secrets is the vehicle’s “Octovalve,” which could very well be an upgraded version of the Model 3’s unique “Superbottle,” which serves as the heart of the all-electric sedan’s thermal management system.
The Model 3 broke all conventions when it became evident that instead of using a different cooling system for the vehicle’s battery pack, cabin, and electronics, the all-electric sedan used one compact centralized thermal management system. Traditional automakers usually install several cooling systems in a car, since components are outsourced to different companies. Tesla opted for a different strategy with the Model 3, thanks to its vertically-integrated approach to its vehicles’ design.
Based on recent photographs taken by auto teardown expert Sandy Munro, the Model Y is also equipped with a novel thermal management system. But instead of a Superbottle, Tesla appears to have provided its latest vehicle with an “Octovalve” instead. Munro is yet to tear down and analyze the Octovalve, but just like its predecessor, it seems to be the heart of the Model Y’s cooling and heating system.
Interestingly enough, the use of the Octovalve instead of the Superbottle in the Model Y may be due to the all-electric crossover’s heat pump. Prior Teslas like the Model S, Model 3, and Model X have used electronic resistive heating systems, which are quick but less efficient than heat pumps.
This is speculation of course, but it appears that the Octovalve may be a novel way for Tesla to combine all heating and cooling systems in the Model Y in one unit. To make this possible, Tesla needed a customized, smart valve system that can perform all the cooling and heating tasks for the Model Y. Based on Munro’s previews, this definitely seems to be the case, as hinted at by the Octovalve’s own badge — an octopus with a snowflake on its head.
Elon Musk has mentioned the Octovalve in a previous tweet, while responding to a Tesla community member who inquired if the Model Y had a solution that is better than the Superbottle. Musk noted in his tweet that the Octovalve is pretty special on its own right, though he was quick to emphasize that all credit for the creation of the system is to the Tesla team, not himself.
“Yes. PCB design techniques applied to create a heat exchanger that is physically impossible by normal means. Heat pump also has a local heating loop to spool up fast & extend usable temperature range. Octavalve is pretty special too. Team did great work. No credit to me,” Musk wrote.
While discussing the Superbottle during the Model 3’s teardown, Sandy Munro stated that device, apart from giving serious technical and cost advantages for Tesla, is the very representation of the electric car maker’s vertical integration. By adopting such a device, Tesla pretty much saved on space, assembly costs, and final assembly time. Such is just not possible with other EVs such as the Chevy Bolt, an otherwise great electric car that utilizes three separate cooling systems.
“The Superbottle is a great example of how the normal automotive companies don’t work together, and Tesla does. That Superbottle crosses many lines that you can’t cross here (in Detroit). If I’m in charge of engine cooling or battery cooling, I don’t want nothing to do with cooling the cabin. And yet, we’ve got the motor cooling, the battery cooling, and electronics, all going through one little bottle that’s got some clever little ball valves that open and close to make sure that everything’s getting heated or everything’s being cooled to where it needs to be. We all thought that was the best thing in the whole damn car,” Munro commented.
Very little is known about the Octovalve and its actual functions for now, but if speculations are correct, it appears that Tesla has created something novel for its newest vehicle’s cooling and heating system once more. This bodes well for the company’s next vehicles as well, such as the Plaid Model S and Model X, the Cybertruck, the Semi, and the next-generation Roadster. Needless to say, it would be very interesting to see what vertically integrated solution Tesla creates for its next electric cars.
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In a new note to investors on Tuesday, Morgan Stanley analyst Andrew Percoco said that Tesla has one big financial question to answer for investors regarding its Robotaxi rollout, Full Self-Driving software, and Optimus.
Percoco said in the note that, for the most part, investors are still very positive about the direction the company is headed. However, there are some things the firm would like to see, and they have to do with financials.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Tesla bulls are more than convinced that the company’s Full Self-Driving software is proof it can develop physical AI. Financially, however, there are still some questions, especially on elevated spending, which CEO Elon Musk said would occur as the company works to roll out Robotaxi faster and continue developing its Optimus robot.
The latter two are where Tesla will have to prove progress to investors, as Percoco writes that both projects “will require clearer evidence that Robotaxi is scaling and more tangible Optimus proof points to support the ROI on elevated capex.”
Percoco said the second quarter earnings call did not change his long-term thesis of where Tesla is positioned in the AI race, which is out in front. However, there are concerns that weaker gross margins and higher R&D spend will stress financials, and that has “sharpened our (and investors’) focus on measurable progress across Robotaxi and Optimus.”
Additionally, Robotaxi still needs to be proven with more operation in existing cities while maintaining safety but improving how many rides it gives in any given time, he said. For Optimus, Percoco wrote that he is “still looking for evidence beyond commentary around SOP.”
Morgan Stanley put Percoco in charge of covering Tesla after long-time analyst Adam Jonas transitioned to the automotive side.
Currently, Morgan Stanley has a $415 price target on Tesla and a ‘Hold’ rating on the stock. It is trading at around $330 at the time of publication, which was 2:30 P.M. on the East Coast.
SpaceX’s massive investment in AI will make it a big winner, Argus Research said after the company’s successful earnings call last week.
The firm also upgraded shares to a Buy from Hold and set a $160 price target.
SpaceX (NASDAQ: SPCX) is currently recovering from its heavy AI infrastructure investments, as it spent nearly $16 billion in Q2 alone. The company did this primarily by monetizing high-demand GPU compute capacity at a much faster pace than traditional data center economics would suggest.
Company CFO Bret Johnsen said that SpaceX would be able to pay back anything on new deployments within a year.
There are plenty of ways the company can do this:
Leasing excess compute capacity through contracts
SpaceX has already built Colossus and Colossus II, largely for its own model training. However, much of that capacity is already rented out to third parties. It already has major deals with Anthropic, Google, and Reflection AI. These partnerships are adding billions per month to SpaceX’s spreadsheet.
High utilization driven by industry-wide scarcity
The demand for advanced AI training and inference capacity continues to exceed what is available for use. SpaceX can fill new racks quickly after they come online, so the capital deployed converts into revenue with minimal idle time.
Additionally, management and outside observers have described the new compute capital as behaving more like a cost-of-goods-sold than traditional multi-year capex, especially because of this rapid monetization pattern.
Capacity has already scaled from ~0.4 GW a year to 1.4 GW annually by the end of Q2. There are targets of more than 2 GW by year-end.
High incremental margins on the rental business once capacity is online
GPU cloud providers often operate at strong gross margins. SpaceX can monetize capacity that was already partially built or can be added efficiently. This means that incremental EBITDA margins on the rental revenue are usually high. This accelerates cash recovery relative to the gross capital outlay.
Parallel monetization of its own AI software and applications
Beyond pure infrastructure rental, SpaceX also generates revenue from Grok through subscriptions and usage, from X through ads, data, and other related services, enterprise APIs, and the planned integration of the Cursor coding tools acquisition.
These application layers ride on the same compute infrastructure and provide additional high-margin streams that could offset build-out costs. AI-segment revenue overall rose sharply to about $2.6 billion in Q2, according to Motley Fool. This was driven primarily by the infrastructure contracts, but the software side is also partially responsible.
Efficient, large-scale deployment and vertical integration advantages
SpaceX has emphasized the rapid construction of power and cooling infrastructure and favorable cost-per-megawatt economics relative to industry benchmarks in some disclosures.
Combined with its ability to scale capacity aggressively and the fact that many contracts start generating revenue within months of capacity coming online, the effective payback compresses dramatically compared with more conventional multi-year data-center projects.
SpaceX’s dominant near-term recovery path will turn the AI clusters into a hyperscale-style compute rental business for other leading AI companies while still using a portion for internal models.
Tesla headlights have caused a recall of over 20,000 of the company’s two most popular vehicles, the Model 3 and Model Y, due to the low-beam bulb exceeding the maximum allowed intensity according to federal standards.
Tesla initiated the recall with the National Highway Traffic Safety Administration (NHTSA) this morning, stating that the low-beam output “exceeds the maximum allowed intensity in the outer upper-right and outer upper-left areas of the 10U and 90U zone, as prescribed in FMVSS No. 108.”
Tesla sourced the impacted headlights from Marelli Automotive Lighting, a Mexico-based company. The recall impacts 2020-2023 Model Y vehicles and 2017-2023 Model 3 vehicles. It is estimated that every VIN in this recall is impacted by the defect.
🚨 Tesla is recalling 20,349 2020-23 Model Y vehicles and 2017-23 Model 3 vehicles due to an excessively bright headlamp low beam.
Currently, there is no remedy plan in place, as it is still being developed. pic.twitter.com/y34cIO2U0B
— TESLARATI (@Teslarati) August 11, 2026
Typically, Tesla would remedy recalls of this nature through an Over-the-Air software update, which has been a major focus of criticism by the company and its supporters because the NHTSA still refers to it as a “recall,” even though it requires no action by the vehicle owner. The fix is shipped over the internet and downloaded to the car.
However, there appears to be a potentially different solution for this problem. Tesla has not developed a remedy for this issue, so it could potentially be on the way. The big issue appears to be the fact that these recalled lamps are out of production, and this is an old body style for both vehicles. The headlights and front-end designs are completely different.
Tesla switched to another supplier when the affected headlight design was discontinued. It plans to begin notifying owners of their remedy options by September 15.
Tesla filed a petition protesting the recall to fix the vehicles’ headlight issue, but the NHTSA denied it. Now, Tesla will come up with a solution to fix it.
Tesla has one big financial question to answer for investors: Morgan Stanley
SpaceX AI investment gamble will make it a big winner, firm says
