A Tesla Cybercab prototype in front of the Nasdaq MarketSite on Monday in New York’s Times Square.
(Bloomberg) — Tesla Inc. sees the forthcoming Cybercab as its long-promised more affordable electric vehicle — and it’s willing to make fundamental design changes to sell the car in high volumes.
In short, it’s open to making it more like a normal vehicle that human drivers can control.
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“If we have to have a steering wheel, it can have a steering wheel and pedals,” Robyn Denholm, the chair of Tesla’s board of directors, told Bloomberg News in an interview Tuesday.
The comments from Denholm, who’s going all-out to sell shareholders on the merits of an unprecedented pay package for Elon Musk, signify some crucial wiggle room in Tesla’s product roadmap.
While some investors have been on board with the chief executive officer deciding early last year to prioritize bringing a completely autonomous vehicle to market, others have fretted about this being a high-risk pursuit.
Their concern is that Tesla’s technology may not be far enough along to safely remove drivers by the time Cybercab enters production next year. If that’s the case, Tesla could have trouble growing without a new EV positioned below its cheapest car, the Model 3.
Denholm clarified that the Cybercab is just that — what many investors have colloquially referred to as a Model 2.
A Tesla Cybercab prototype in front of the Nasdaq MarketSite on Monday in New York’s Times Square.Photographer: Michael Nagle/Bloomberg
Musk first unveiled the Cybercab on a movie studio lot near Los Angeles a year ago this month. Weeks after showing off the prototypes that lacked steering wheels and pedals, the CEO bristled at a question posed during an earnings call — when could investors expect Tesla to offer a cheaper car that isn’t intended to be used as a robotaxi?
“Having a regular $25K model is pointless,” Musk said, referring to a price point he’d touted at least as far back as 2020. “It would be silly. Like, it would be completely at odds with what we believe.”
Denholm’s stated openness to modifying the Cybercab — which is scheduled for volume production next year — suggests Tesla may be more amenable than Musk indicated a year ago. This could be in part because regulators thus far have been reluctant to budge on certain longstanding safety standards, despite Musk having lobbied Washington to do so.
Duffy Differences
When Transportation Secretary Sean Duffy visited Tesla’s Austin factory in May, the CEO played host and made his pitch alongside one of the company’s humanoid robot prototypes.
“We think autonomous driving will reduce accidents by a factor of 10, and ultimately save millions of lives,” Musk said in a video Duffy posted on X.
The two have been at odds more recently. Duffy, who’s been pulling double duty as acting administrator of NASA, said last week the space agency would reopen a contract awarded to SpaceX out of frustration with the Musk-run company not being ready to help facilitate a moon mission.
Musk has responded with insults, referring to the Transportation Secretary as “Sean Dummy” and writing on X: “The person responsible for America’s space program can’t have a 2 digit IQ.”
When asked whether she was concerned about Musk’s barbs, Denholm deflected.
“As a company, we push the boundaries of technology, we push the boundaries of regulation,” she said. “Regulators normally are looking to the future, but they don’t know what the future is going to be, so working with them is our mode, and we’ve done that for years now.”
Exemption Difficulties
Companies led by Alphabet Inc.’s Waymo that have beaten Tesla to market with driverless vehicles have done so with cars that still have steering wheels and pedals that are required under federal vehicle safety standards.
Seeking exemptions from those rules can be a long and arduous process. The US National Highway Traffic Safety Administration didn’t act for more than two years on General Motors Co.’s attempt to get authorization for its purpose-built autonomous vehicle, the Cruise Origin. GM ended up scrapping plans for the Origin last year before shutting down Cruise altogether.
Even if Tesla were to overcome the hurdles Cruise couldn’t, NHTSA only allows manufacturers to deploy as many as 2,500 autonomous vehicles per year that lack traditional controls. That limitation would effectively render the Cybercab a niche product in Tesla’s biggest market.
There’s precedent for Tesla pivoting in this regard, Denholm said.
“The original Model Y was not going to have a steering wheel, or pedals,” she said. “If we can’t sell something because it needs something, then we’ll work with regulators to work out what we need to do.”
–With assistance from Richard Clough and Shelly Banjo.
(Updates with Musk’s relationship with the US Transportation Secretary starting in the 11th paragraph.)
