Next month, Tesla chairman Elon Musk is due in Israel to deliver the keynote speech at the Smart Transportation conference. Tesla is now not only a dominant player in the electric vehicle market, but also a trendsetter in the global tech industry. In a country like Israel, which is a major global tech hub, the visit and the announcements that will accompany will be of great importance worldwide. Musk will also likely use the visit for business and political meetings regarding the other companies in his group, from X (formerly Twitter) to satellite company SpaceX.
Although in recent years, global investors have learned to treat some of Musk’s future plans with skepticism, he still has tens of millions of followers in the tech world and capital markets and is listened to by US politicians and regulators.
Tesla has not released any details about Musk’s visit to Israel. It is likely that Israeli ministries are already working on rolling out the red carpet for the distinguished guest and preparing statements on regulatory issues and more.
Tesla is changing direction
At an investor conference held in late January to present Tesla’s annual report, Musk said, « We are moving toward a future based on autonomy. » Just days earlier, the company had announced that it was discontinuing production of two of its most iconic models, the Model S, which was its first mass-produced car, and the unique Model X minivan.
For analysts this was clear evidence that Tesla is changing direction, from a car manufacturer to a tech company. Piper Sandler wrote, « The company is burning the boats, pinning its future on autonomous cars and robots. » Another analyst wrote, « Forget the Tesla we knew, the Tesla of yesterday is gone. »
Tesla was a pioneer in the electric vehicle market, and it used the advantage to establish a leading position in the fields of technology and manufacturing. Even today, its brand is very strong, but competitors, mainly from China, are rapidly closing the gap in technology and quality and are constantly introducing models that Tesla has no response for in terms of variety and price.
Tesla’s temporary solution has been to introduce significantly discounted models of the Y and 3, with less accessories. But in the absence of popular models or with plug-in drives, as every Chinese car has today, Tesla faces constant erosion in sales and revenue.
But Tesla’s biggest current problem is that it now has to invest a lot of resources in the logistical tasks of the « old » car industry, such as supplying spare parts and repairs for its 8.5 million vehicles worldwide. This is an activity that is light years away from the « innovative and fast » model on which the company was founded, and it is far from capturing the imagination of investors. In contrast, the autonomous vehicle has been and remains a magnet for investors.
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