This analysis was first published in SvD Näringsliv, in Swedish, on April 24th, 2024. This piece was translated from Swedish by Claude. Some phrasing may differ from a human translation.

After weeks of nothing but setbacks, Tesla reported weak quarterly figures. The hope is that shareholders will look past the problems for now — and keep looking towards the future.

Of all the world’s CEOs, not just anyone gets to meet with India’s Prime Minister Narendra Modi. And not just anyone cancels such a meeting at a few days’ notice because they have more pressing things to attend to at home.

But then, Elon Musk is not quite like everyone else. The late cancellation of the Modi meeting says something about the past few weeks for both him and Tesla.

In mid-April, the company laid off ten percent of its workforce — around 14,000 employees — to, in Musk’s words, “prepare the company for the next wave of growth.” They then cut prices on the Full Self-Driving software and on the Model S, Y, and X. One of several reductions in recent months as the inventory of unsold vehicles has grown.

Tesla then had to recall every Cybertruck — the company’s newest model — after the accelerator pedal was found capable of getting stuck in the pressed position. Tesla can usually resolve such recalls with over-the-air software updates, but this particular problem had to be fixed manually. With a drill.

Musk also had to go back to shareholders to seek approval to reinstate his pay package, which a Delaware judge had struck down as improper. The total in question is over 605 billion kronor, which Tesla’s shareholders are now due to vote on in June. The situation could be contentious, given that the compensation dates back to 2018 and the share price has fallen around 40 percent since the start of this year.

On Tuesday evening, Tesla reported its quarterly results — and the week did not get much better. Revenue from car sales fell by a full 13 percent compared with the previous year, and total profit dropped 55 percent. Despite low expectations among analysts, Tesla’s figures still came in below consensus.

Does that sound dismal? For an ordinary car company, it would be. But as noted, neither Elon Musk nor Tesla are quite like everyone else. Despite the poor numbers, the share surged in after-hours trading.

The optimism can likely be traced to two forward-looking sentences in the quarterly report. The first: “We have updated our future vehicle lineup to accelerate the launch of new models.” New cars are coming faster than previously announced, in other words.

Shortly after: “These new vehicles, including more affordable models […] will be able to be produced on the same manufacturing lines as our current vehicles.” The key word is “affordable” — the market and shareholders have long anticipated a cheaper car. Earlier in April, Reuters reported that this product had been shelved in favour of building self-driving robotaxis instead. Musk denied the story and wrote on X that they had “lied.”

The other forward-looking initiative is the robotaxi itself — a product that has featured in Tesla’s plans since 2016. Musk has promised to unveil it in August this year.

The Full Self-Driving software available in the cars has been updated to a new AI-based system. For Tesla enthusiasts, all eyes are on this development. This is where Tesla could become — and for some, already is — something fundamentally different from an ordinary car company.

Keeping to timelines, however, is not Tesla’s strongest suit. And deploying self-driving robotaxis is not purely a question of whether the technology works and can be produced in time — it is a matter of permits and regulation. Waymo, owned by Google, has been at it since 2009 and is so far only available in two American cities. General Motors’ equivalent initiative, Cruise, was put on ice entirely following an accident. It is a promising technology, but it has no easy path to mass deployment in the near term.

Elon Musk is a master at selling the future before it has arrived. On an increasingly pressured electric vehicle market, he shifts the focus away from today’s problems towards what is to come. He has a long tail of enthusiasts who follow him. But with figures like those reported on Tuesday, the future cannot come soon enough for Tesla.