Will Tesla’s Cybertruck Define the Company’s Future?

Tesla’s (TSLA) Cybertruck is divisive.

The electric truck received nearly 2 million pre-orders ahead of its 2019 launch, but hype has since died down in some parts of the market, partly due to its higher-than-expected price tag, recalls raising safety concerns and its design.

“It looks really ugly. Ugly is interesting.”

That’s how Shark Tank investor and entrepreneur Kevin O’Leary described the car to Yahoo Finance in May 2023. O’Leary has invested in companies that provide the technology behind the truck.

As of mid-June, Tesla was producing 1,300 Cybertrucks per week, with a goal of reaching 2,500 vehicles per week by the end of 2024. With a price tag of nearly $100,000 for the top-of-the-line model — the Cyberbeast — the truck is pricier than the roughly $50,000 price tag that investors had expected.

Will the Cybertruck be Tesla’s next big hit, as ubiquitous as the Model 3, or a miss for the EV company? Here are some things to consider when evaluating the Cybertruck’s potential impact on Tesla’s financial future.

FILE - In this Nov. 21, 2019, file photo, Tesla CEO Elon Musk introduces the Cybertruck at Tesla's design studio in Hawthorne, California. The much-hyped unveiling of Tesla's electric pickup truck went off the rails Thursday night when the supposedly shatterproof window glass broke twice when it was hit by a large metal ball. The failed stunt, which ranks high on the list of embarrassing rollout failures in the auto industry, came just after Musk bragged about the power of

In this Nov. 21, 2019, photo, Tesla CEO Elon Musk introduces the Cybertruck at Tesla’s design studio in Hawthorne, California. (AP Photo/Ringo HW Chiu, File) (ASSOCIATED PRESS)

Bulletproof. Stainless steel skin. A steering wheel that feels electric. These are all features unique to the Cybertruck, the first vehicle in the U.S. to use a full steer-by-wire system.

Steer-by-wire differs from typical pickup trucks in that it uses electronics to steer instead of a steering rack that connects the wheel to the tires. It is considered a more energy-efficient system.

While the car’s bulletproof exoskeleton is appealing to some consumers, it’s a disappointment to others.

“The Cybertruck is really different… it’s like a Blade Runner-esque, dystopian car with sharp edges of stainless steel,” said Pras Subramanian, senior auto reporter at Yahoo Finance.

The car’s aesthetics could be here to stay. Walter Isaacson, who wrote a biography of Musk, has seen preliminary sketches of the long-awaited (and delayed) robotaxi and said it looks like the Cybertruck.

In terms of demand, the Cybertruck could be a key differentiator in the increasingly competitive electric vehicle market.

Tesla’s share of U.S. EV sales fell below 50% for the first time in the second quarter. At the same time, the Cybertruck was the best-selling EV pickup truck in the U.S. in May, according to S&P Global.

Tesla hasn’t disclosed how much it costs to build the Cybertruck, but the vehicle was first built at the company’s new Texas Gigafactory, a $10 billion investment, Musk said.

And the process of building the truck isn’t easy. The unique exoskeleton is formed using a technique called airbending, which uses high air pressure to shape the stainless steel.

Tesla wants to get the price around $50,000, but production costs could make that difficult.

What’s the verdict? Despite mixed reviews, Tesla’s loyal fans may continue to support Musk’s product visions — and Tesla’s stock price.

Tesla short sellers have lost more than $60 billion since the company went public, according to Ihor Dusaniwsky, managing director at S3 Partners.

Ultimately, it’s not always fundamental business metrics, like Cybertruck sales, that drive Tesla’s stock price.

“It’s really more what the market does than what Tesla actually does,” Dusaniwsky said.

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