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Tesla at a tipping point: How a focus on safety and features is building a formidable car brand
Last week, JD Power revealed the results of a study about the public’s perception of electric vehicles and autonomous driving technologies. The results of the survey were not that encouraging, with 68% of the respondents stating that they had zero experience with electric cars. The majority of the study’s demographic also stated that they would not consider an EV as their next car purchase.
Yet, despite these results, one particular vehicle seems to be bucking the trend. In June, Tesla sold just shy of 40,000 Model 3 across the globe, making it the best-selling electric car worldwide. Following the Model 3 was the BAIC EU-Series from China, which was far behind at almost 18,000 units sold. Third place in June’s global EV sales rankings was the BYD Yuan, which sold 6,566 units. The Model 3’s feat is impressive, considering that the market is just beginning to seriously embrace electric cars as a viable alternative to gas-powered automobiles.
Baillie Gifford’s recently-released Annual Financial Report noted that Tesla had reached a milestone with the Model 3, as exhibited by the vehicle becoming the US’ best-selling passenger car by revenue over the past four quarters. This milestone could have been achieved by Tesla because the company has and continues to develop a reputation for building great cars that just happen to be electric, not electric cars that just happen to be good. By emphasizing the innate strengths of electric vehicles, Tesla has created a brand that is becoming synonymous with safety and bleeding-edge features.
The Tesla Model 3, Model S, and Model X are three of the safest vehicles on the road today. This is partly due to the vehicles being designed from the ground up as electric cars. With their generous crush zones and rigid frames, Teslas are capable of protecting their occupants, even in potentially serious crashes. Some of these incidents are shared online through the Tesla community and beyond, and they help spread the word that the company’s vehicles are among the safest vehicles on the road today.
The aftermath of these incidents usually follows a similar pattern too, with a Tesla getting damaged and the other vehicle coming out worse for wear. An example of this could be found in this recent incident involving an otherwise intact Model 3 toppling a fire hydrant after getting rear-ended by a Subaru. As could be seen in pictures of the crash’s aftermath, the gas-powered car looked like it hit a wall when it smashed into the Model 3.
Teslas are essentially computers on wheels, and this is one of the reasons why the Model S, Model X, and Model 3 are among the very few vehicles on the road that can receive new features through free over-the-air updates. This has become a crucial part of the Tesla ownership experience, as cars that are handed over to customers only get better with time. Some of these features, such as Sentry Mode and TeslaCam, have even helped owners catch individuals that vandalize their vehicles.
In a recent report, the Highway Loss Data Institute stated that Teslas are among the least likely vehicles to get stolen in the United States, with the Model S and X nearly 90% less likely to attract thieves than the average automobile. The reasons for this could vary, but the fact that Teslas are equipped with a suite of security features, and the fact that the National Crime Information Center tracked 112 recovered Teslas out of 115 stolen vehicles between 2011 and May 2018, establishes the company’s electric cars as vehicles that are pretty tricky to steal.
Tesla only commands a tiny fraction of the overall automotive market today. Even with the aggressive ramp of the Model 3, Tesla is still far from breaching the mass markets that are dominated by low-cost vehicles that have been around for decades. This does not mean to say that Tesla is not making progress, as the company is steadily increasing its reach in the auto industry’s premium segment. And thanks to the company’s innovations and unique approach to its vehicles, Tesla is making itself into a brand that simply attracts a ton of interest.
An example of this could be seen in Japan recently, where Tesla showcased the Model 3 (which is yet to be distributed to the country) at the Haneda Airport. Not too far from the Model 3 was an exhibit of the gas-powered B-Class from Mercedes-Benz, a premium vehicle from a veteran carmaker that is synonymous with luxury. The interest attracted by the two vehicles among the people at the Japanese airport was very telling.
Elon Musk
Elon Musk explains why Tesla’s 4680 battery breakthrough is a big deal
Tesla confirmed in its Q4 and FY 2025 update letter that it is now producing 4680 cells whose anode and cathode were produced during the dry electrode process.
Tesla’s breakthroughs with its 4680 battery cell program mark a significant milestone for the electric vehicle maker. This was, at least, as per Elon Musk in a recent post on social media platform X.
Tesla confirmed in its Q4 and FY 2025 update letter that it is now producing 4680 cells whose anode and cathode were produced during the dry electrode process.
Why dry-electrode matters
In a post on X, Elon Musk stated that making the dry-electrode process work at scale was “incredibly difficult,” calling it a major achievement for Tesla’s engineering, production, and supply chain teams, as well as its partner suppliers. He also shared his praise for the Tesla team for overcoming such a difficult task.
“Making the dry electrode process work at scale, which is a major breakthrough in lithium battery production technology, was incredibly difficult. Congratulations to the @Tesla engineering, production and supply chain teams and our strategic partner suppliers for this excellent achievement!” Musk wrote in his post.
Tesla’s official X account expanded on Musk’s remarks, stating that dry-electrode manufacturing “cuts cost, energy use & factory complexity while dramatically increasing scalability.” Bonne Eggleston, Tesla’s Vice President of 4680 batteries, also stated that “Getting dry electrode technology to scale is just the beginning.”
Tesla’s 4680 battery program
Tesla first introduced the dry-electrode concept at Battery Day in 2020, positioning it as a way to eliminate solvent-based electrode drying, shrink factory footprints, and lower capital expenditures. While Tesla has produced 4680 cells for some time, the dry cathode portion of the process proved far more difficult to industrialize than expected.
Together with its confirmation that it is producing 4680 cells in Austin with both electrodes manufactured using the dry process, Tesla has also stated that it has begun producing Model Y vehicles with 4680 battery packs. As per Tesla, this strategy was adopted as a safety layer against trade barriers and tariff risks.
“We have begun to produce battery packs for certain Model Ys with our 4680 cells, unlocking an additional vector of supply to help navigate increasingly complex supply chain challenges caused by trade barriers and tariff risks,” Tesla wrote in its Q4 and FY 2025 update letter.
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Even Tesla China is feeling the Optimus V3 fever
As per Tesla China, Optimus V3 is “about to be unveiled.”
Even Tesla China seems to have caught the Optimus V3 fever, with the electric vehicle maker teasing the impending arrival of the humanoid robot on its official Weibo account.
As per Tesla China, Optimus V3 is “about to be unveiled.”
Tesla China hypes up Optimus V3
Tesla China noted on its Weibo post that Optimus V3 is redesigned from first principles and is capable of learning new tasks by observing human behavior. The company has stated that it is targeting annual production capacity of up to one million humanoid robots once manufacturing scales.
During the Q4 and FY 2025 earnings call, CEO Elon Musk stated that Tesla will wind down Model S and Model X production to free up factory space for the pilot production line of Optimus V3.
Musk later noted that Giga Texas should have a significantly larger Optimus line, though that will produce Optimus V4. He also made it a point to set expectations with Optimus’ production ramp, stating that the “normal S curve of manufacturing ramp will be longer for Optimus.”
Tesla China’s potential role
Tesla’s decision to announce the Optimus update on Weibo highlights the importance of the humanoid robot in the company’s global operations. Giga Shanghai is already Tesla’s largest manufacturing hub by volume, and Musk has repeatedly described China’s manufacturers as Tesla’s most legitimate competitors.
While Tesla has not confirmed where Optimus V3 will be produced or deployed first, the scale and efficiency of Gigafactory Shanghai make it a plausible candidate for future humanoid robot manufacturing or in-factory deployment. Musk has also suggested that Optimus could become available for public purchase as early as 2027, as noted in a CNEV Post report.
“It’s going to be a very capable robot. I think long-term Optimus will have a very significant impact on the US GDP. It will actually move the needle on US GDP significantly. In conclusion, there are still many who doubt our ambitions for creating amazing abundance. We are confident it can be done, and we are making the right moves technologically to ensure that it does,” Musk said during the earnings call.
Elon Musk
Tesla director pay lawsuit sees lawyer fees slashed by $100 million
The ruling leaves the case’s underlying settlement intact while significantly reducing what the plaintiffs’ attorneys will receive.
The Delaware Supreme Court has cut more than $100 million from a legal fee award tied to a shareholder lawsuit challenging compensation paid to Tesla directors between 2017 and 2020.
The ruling leaves the case’s underlying settlement intact while significantly reducing what the plaintiffs’ attorneys will receive.
Delaware Supreme Court trims legal fees
As noted in a Bloomberg Law report, the case targeted pay granted to Tesla directors, including CEO Elon Musk, Oracle founder Larry Ellison, Kimbal Musk, and Rupert Murdoch. The Delaware Chancery Court had awarded $176 million to the plaintiffs. Tesla’s board must also return stock options and forego years worth of pay.
As per Chief Justice Collins J. Seitz Jr. in an opinion for the Delaware Supreme Court’s full five-member panel, however, the decision of the Delaware Chancery Court to award $176 million to a pension fund’s law firm “erred by including in its financial benefit analysis the intrinsic value” of options being returned by Tesla’s board.
The justices then reduced the fee award from $176 million to $70.9 million. “As we measure it, $71 million reflects a reasonable fee for counsel’s efforts and does not result in a windfall,” Chief Justice Seitz wrote.
Other settlement terms still intact
The Supreme Court upheld the settlement itself, which requires Tesla’s board to return stock and options valued at up to $735 million and to forgo three years of additional compensation worth about $184 million.
Tesla argued during oral arguments that a fee award closer to $70 million would be appropriate. Interestingly enough, back in October, Justice Karen L. Valihura noted that the $176 award was $60 million more than the Delaware judiciary’s budget from the previous year. This was quite interesting as the case was “settled midstream.”
The lawsuit was brought by a pension fund on behalf of Tesla shareholders and focused exclusively on director pay during the 2017–2020 period. The case is separate from other high-profile compensation disputes involving Elon Musk.
Elon Musk explains why Tesla’s 4680 battery breakthrough is a big deal
Even Tesla China is feeling the Optimus V3 fever
