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Tesla bear gets shot down after insisting that ‘competition’ is coming for TSLA

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A Tesla (NASDAQ:TSLA) bear’s arguments about the impending arrival of competitors in the electric car market was boldly shut down in a recent segment on CNBC’s Squawk Box. During the exchange, veteran journalist Phil LeBeau aired what could only be described as a longtime sentiment from Tesla investors: After all those predictions, where are Tesla’s supposed competitors?

The Squawk Box segment featured Tasha Keeney of Ark Invest and Craig Irwin of Roth Capital Partners, each one representing the bull and bear side for TSLA stock. While Keeney reiterated ARK’s optimistic stance on Tesla and its potential in the full self-driving market, Irwin instead focused on what he alleged was the electric car maker’s disadvantage in battery technology. The Tesla bear insisted that Tesla is currently paying $240/kWh for its cells from Japan while Porsche and Volkswagen are paying $250/kWh. This was a point that Phil LeBeau directly addressed, citing the findings of Sam Jaffe from Cairn Energy Research, who estimated that Tesla has reached costs of around $116 per kWh for its battery cells.

The Roth Capital Partners analyst added that he is taking a bearish stance against Tesla now due to the incoming wave of competitors that are coming to the market. Irwin specifically pointed to the Porsche Taycan as one of these vehicles.

“It’s starting this year. That’s why I chose to initiate with a bearish perspective. Porsche is going to come on with the Taycan, you’ve got Kia, you’ve got the I-PACE… You got to look at the history, so the Cayenne, the first thing they said 10, then they said 20, then it became 40. So it ramped very very quickly. They set expectations low, make a lot of money on the front end, and ramp. Porsche, their business is making money. They’re not about, you know, fluffing numbers. So if they think they can sell 30,000 cars into the market over the next 18 months and make a great profit on it, they’ll do it. But they’re not gonna flood the market to a point you know, it compresses margins,” Irwin claimed.  

Irwin’s thesis was immediately met by a rebuttal from LeBeau, who noted that the argument for Tesla competitors has been going on for a long time. The CNBC journalist argued that it is better for other carmakers to start showing (not just telling) how they can actually compete with Tesla by releasing a real, compelling electric vehicle.

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“I think it poses a problem for Tesla from the standpoint of ‘Let’s finally see this vehicle.’ I honestly believe based on Tesla owners that I’ve talked with as well as those who track the company, we’re tired of hearing ‘the competitors are coming, the competitors are coming.’ Bring it out. Bring it out, and if Porsche’s Taycan is as impressive as the initial indications are, then it will be a threat to Tesla, but until then, this is a little bit like The Boy (Who) Cried Wolf. We hear it all the time. ‘There’s a wave of vehicles coming.’ Well, that wave of vehicles isn’t here yet. It was supposed to be here by 2019. It’s not here yet. When does it get here? If I’m a Tesla investor, I’m not too worried about this argument until we start to see these vehicles,” LeBeau retorted.

Phil LeBeau was actually being quite generous when he noted that the Porsche Taycan will be a threat to Tesla. Porsche is a niche carmaker, and it is a company that prioritizes the exclusivity of its vehicles. At most, the Taycan will eat into the Model S’ sales since they compete in the same segment. The German-made all-electric car from Porsche will not compete in the same mass-market segment as the Model 3, or the Model Y for that matter.

One thing that Tesla skeptics always seem to forget is that electric vehicles from other carmakers will not kill or overwhelm Tesla. Instead, they are vehicles that contribute to the mission of the electric car maker, which is to encourage the world to shift away from the internal combustion engine. Thus, every Taycan and I-PACE that is sold is not a lost sale for Tesla; it is a lost sale for gas and diesel-powered vehicles.

Watch the recent TSLA bull vs. bear debate in CNBC’s Squawk Box in the video below. 

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Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Investor's Corner

Tesla tailwinds could drive momentum-filled finish to 2025: analyst

Tesla is heading toward some momentum to finish out the year, one Wall Street firm believes.

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Credit: @heydave7/X

Tesla has some tailwinds that could drive it toward a momentum-filled finish to the year, one Wall Street analyst is predicting.

The tailwinds are joined by some minor risks that have impacted the broader electric vehicle market, but overall, this firm believes Tesla has many catalysts moving forward.

Emmanuel Rosner of Wolfe Research believes that Tesla has plenty of things that could drive the stock upward as we approach the end of the year. With Q3 well underway, Tesla has about five months of catalysts to rely on to erase the roughly 18 percent drop in stock price it has so far this year.

At first glance, it is easy to see the things that would have investors bullish on Tesla for the rest of 2025 and even beyond. Initially, the Robotaxi launch and expansion, which spread to Northern California last night, provide potentially huge tailwinds for the company moving forward.

Tesla expands Robotaxi operation to California’s Bay Area

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Along with that, and slightly related, are the advancements in Full Self-Driving that the company has made over the past few months.

This includes the potential launch of the FSD suite in regions like Europe and Australia, where the company believes it will make some progress on regulatory approval in the coming months.

Finally, Wolfe says the company’s Optimus project, which is expected to enter scale production sometime next year, is the third catalyst for Tesla moving forward.

With these three projects in motion, Tesla truly can begin to work on rebounding from a rough 2025 on the market.

Rosner writes:

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“This name trades more around the narrative than the numbers. And net-net, we tactically see an improving narrative from here. Tesla has several catalysts coming up w/r/t FSD and Robotaxi, including an expansion of their AV service into several new U.S. markets (San Francisco, Nevada, Arizona, Florida, etc.). The company plans to unlock hands-free/eyes-off autonomy for FSD owners in select U.S. locations by YE25. Supervised FSD in China and Europe is expected to launch over the next ~12 months. And, Optimus is expected to enter scale production in 2026.”

Tesla is currently trading around $310 at around 3:20 p.m. on the East Coast.

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Tesla Robotaxi execution should lead to valuation ‘far exceeding current levels’: analyst

RBC Capital bumped its price target on Tesla stock slightly from $319 to $325.

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Credit: @TerrapinTerpene/X

Tesla’s Robotaxi platform is the primary focus for the automaker currently, and based on what has been outlined by the company as goals for the project, one firm is saying that the company’s valuation should “far exceed even current levels.”

The Robotaxi is a self-driving ride-hailing service that Tesla plans to implement in current and future vehicle builds. CEO Elon Musk and other executives have said that “the vast majority of the Tesla fleet that we’ve made is capable of being a Robotaxi,” thanks to its development of Over-the-Air software updates that increase the capability of the vehicle with a simple download.

Currently, the Robotaxi platform is only active in a portion of Austin, Texas, but Tesla is expanding to other markets, including California, Nevada, Arizona, and Florida. California will be the next market to open its doors to the Tesla Robotaxi platform.

But the name of the game is execution, and that’s what Tesla is aiming for in a timely fashion. If it can come through on all of its current goals, its valuation could explode, and one firm is holding steady on that narrative as Tesla continues to work toward expanding Robotaxi.

On Tuesday, RBC Capital analysts bumped their price target on Tesla shares (NASDAQ: TSLA) to $325 from $319, primarily due to the Robotaxi expansion and its success:

“Should Tesla be successful on all of its goals, its valuation could far exceed even current levels. The Austin Robotaxi launch has been better than many feared, and the company is looking to expand in more cities.”

There are some risks to Tesla’s narrative, but they fall outside the scope of what the company can control. In relation to Robotaxi, regulatory hurdles remain. Some regions may be slower than others to give Tesla the proper licensing to operate in their jurisdiction. This could slow the pace of Robotaxi expansion, bringing some overhang to the story.

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Additionally, Tesla is fending off narratives of slowing demand, and the White House’s decision to revoke the $7,500 EV tax credit from consumers could temper sales past Q3.

Nevertheless, Robotaxi is where Tesla’s true value seems to be focused. Successfully launching a driverless ride-sharing platform is where the company is putting all of its eggs, and revolutionizing passenger travel is where the focus lies.

RBC Capital’s note continued:

“Regulatory hurdles remain, however. Further, we expect the end of IRA credits and high levels of used EV inventory to pressure the auto business for the next several quarters.”

The slight price target bump puts RBC Capital’s expectations near where the stock is trading, as it is currently priced at around $320 at 9:54 a.m. on the East Coast.

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Elon Musk shares details on Tesla AI6 production deal with Samsung

Tesla is already laying the groundwork for the ramp of its next-generation products.

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tesla-supercomputer-pre-dojo
Credit: Tim Zaman/Twitter

Elon Musk has provided some details about Tesla’s AI6 production deal with South Korean tech giant Samsung. As per Musk, Samsung’s upcoming Texas fabrication facility will be dedicated to the production of Tesla’s AI6 chip.

Musk’s update suggests that Tesla is already laying the groundwork for the ramp of its next-generation products like the Cybercab and Optimus.

Samsung AI6 production reports

On Sunday, Bloomberg News claimed that Samsung will be producing semiconductors for Tesla in a $16.5 billion deal. As per the report, Samsung is currently producing Tesla’s AI4 chip, and the deal will help the South Korean tech giant gain some ground back from competitors in the semiconductor market.

Elon Musk confirmed the news on X, stating that the $16.5 billion is actually just the bare minimum. As per Musk, the deal with Samsung will likely be “much more than that.” And in a later comment, Musk clarified that the actual output of Samsung’s Tesla AI6 plant will “likely be several times higher” than what has been reported.

Musk shared a critical detail that would likely allow Samsung to maximize its AI6 output. “Samsung agreed to allow Tesla to assist in maximizing manufacturing efficiency. This is a critical point, as I will walk the line personally to accelerate the pace of progress. And the fab is conveniently located not far from my house,” Musk wrote in his post.

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Elon Musk on AI5 and AI6

Tesla currently produces vehicles with its AI4 chip, which is produced by Samsung. As per the CEO, Tesla’s AI5 chip, which just finished its design, will be produced by TSMC. The AI5 chip will be produced initially in Taiwan, and then in Arizona, the CEO noted.

Elon Musk’s comments about AI6 and Samsung’s output suggest that Tesla is really preparing to enter a stage in its growth that involves production at a scale that’s never been seen before. Tesla’s speed is quite notable, though it seems safe to assume that the actual rollout of AI6 will still be a few years away. 

In a few years, Tesla will probably be mass producing the Cybercab and Optimus, as well as more affordable vehicles that will likely see more adoption from mainstream customers. This means that Samsung’s AI6 ramp will likely be just in time to support Tesla’s outputs for its Optimus bots, its Cybercabs, and its mass market affordable cars.

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