Tesla did its quarterly investor/analyst call last night after releasing its mixed financials. The interesting news is that the company will release a more affordable vehicle in the first half of next year. The bad news, if you think of Tesla as a car company, is that CEO Elon Musk is sticking to his line that it isn’t.

It was also another weird, low-energy call from Musk, though I find he’s a bit more honest when he’s in these down moods. Elsewhere in the Tesla-verse is a judge’s ruling in the company’s favor that it can pursue a trial against Rivian for allegedly encouraging its ex-Tesla employees to steal trade secrets.

Alphabet, aka Google’s parents, aren’t so bothered by GM’s robotaxi shift and are doubling down with a $5 billion investment in its robotaxi arm Waymo. Does it sense blood in the water?

We work hard around here. It’s our culture. But we don’t, I hope, have the stereotypical “Japanese salaryman” kinda vibe. Toyota, also, is hoping to move away from those vibes as it takes a deliberate pause to fix the company.

Tesla Margins Drop To 14.6%

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If you want to lose money, bet against Elon Musk. He has been right more than he’s been wrong, and his companies have made a lot of money for investors. He’s also destroyed shorts with the same intensity of an imperfectly potty-trained toddler after a frito pie bender.

I guess I should clarify: If you bet against Musk in the last year, depending on the timing of those bets, you might have made some money.

My question yesterday about Tesla was more about revenue than margins. Specifically, I was curious how much the company’s push to move cars at a discount would hit Tesla’s historically high margins.

If you look at the company’s Q2 financial disclosure you’ll see the answer is: a lot. Tesla’s margins, after you take out regulatory credits the company gets from other OEMs, dropped to 14.6%, versus analyst estimates of 16.29%. The company did make about $1 billion more in revenue than expected, it just made less money than usual doing it.

If The Autopian were making billions of dollars (it is not) I think I’d be fine with making a little less per dollar if I was making it up in volume. Tesla doesn’t work that way, and its margins were a big part of its perceived value. That’s at least how investors seem to be feeling today. Tesla’s stock is down almost 12% this morning.

Even though the company made a little more in total revenue (up about 2%), where it made those revenues is important:

I’m turning a bit into a broken record here, but Elon Musk does not think of Tesla as a car company. One of the few times he didn’t sound listless during the hour+ call was when he talked about buying chips and AI and his Optimus robot.

Here’s what Elon had to say about all of that:

The undertaking is massive, but I think the future is incredibly bright. I really just can’t emphasize the importance of autonomy for the vehicle side and for Optimus. Although the numbers sound crazy, I think, Tesla is producing at volume with and supervised MSD essentially enabling the fleet to operate a giant autonomous fleet. And it takes the valuation, I think, to some pretty crazy number.

That’s not a lot about cars, though Musk did basically confirm that the affordable Tesla is coming in the first half of 2025 and, rather than some mostly gigacast car, it’ll be a more traditional Tesla model that can be built on existing production lines:

We won’t get too much into the product road map here because that is reserved for product announcement events. But we are on track to deliver a more affordable model in the first half of next year.

I would suggest listening to this section (which you can do here) and you’ll notice he barely finishes his thought about the car before jumping into:

The big — really, by far, the biggest differentiator for Tesla is autonomy. In addition to that, we have scale economies and, I think, we’re the most efficient electric vehicle producer in the world.

If autonomy is so important to Tesla how long do we have to wait to see a fully self-driving robotaxi? Musk was immediately asked this question and gave a more-than-usually accurate assessment:

“It’s difficult, obviously, my predictions on this have been overly optimistic in the past. So I mean, based on the current trend, it seems as though we should get miles between interventions to be high enough that — to be far enough in excess of humans that you could do unsupervised possibly by the end of this year. I would be shocked if we cannot do it next year.”

Musk has made it clear that he’s not content with having a car company, and he doesn’t believe a car company is a particularly interesting or valuable thing to own. He owns an autonomy/robotics/taxi/airbnb/energy storage company. If you think he can pull even half of that off then you don’t really care about a short-term share drop because the impending value of the company makes it a future Apple.

If you don’t believe in him then you should run.

Tesla Can Go Ahead With Rivian Lawsuit

Did Rivian encourage Tesla defectors to steal Tesla’s company secrets in order to improve Rivian’s products? That’s the question at the heart of a lawsuit from Tesla against its rival EV automaker.

Rivian, for its part, denies this happened, and tried to get a judge in California to dismiss the case outright. According to Reuters, that’s not going to happen:

Judge Theodore C. Zayner of the Santa Clara County Superior Court tentatively denied Rivian’s motion to dismiss the lawsuit, stating Tesla presented sufficient evidence for a trial.

“Tesla’s evidence establishes that some Rivian employees were less thoroughly investigated and not disciplined,” the judge wrote in the tentative order.

This will be one to watch.

Google/Alphabet Puts $5 Billion Into Waymo

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Maybe autonomy is important. Google’s parent company Alphabet announced it’s putting $5 billion into its subsidiary Waymo just as Cruise said it was discontinuing development of its steering wheel-less robotaxi.

From CNBC:

“This new round of funding will enable Waymo to continue to build the world’s leading autonomous driving company,” Alphabet’s outgoing finance chief Ruth Porat said Tuesday on the company’s second-quarter earnings call, adding Waymo is an “important example” of Alphabet’s long-standing investments.

Porat announced the “multiyear” investment on the call and said more information would be available in the company’s quarterly Securities and Exchange Commission filing, expected on Wednesday.

The next steps for Waymo are replacing the Jag i-Pace-based robotaxis with Zeekr-based Waymo Drivers and a more robust commercialization.

Toyota Pushes For A 4-Day Workweek

The stereotype of a Japanese “salaryman” is an overworked white-collar employee who puts in 60 hours for his beloved employer, only taking a few hours off to get absolutely blitzed while singing John Denver songs in some seedy karaoke bar.

In a way, that’s how the whole Toyota company has worked for the last few years. Toyota ended up making more money than any other public Japanese company in history last fiscal year, but at what cost? Toyota’s employees were so stretched they started cheating on emissions and safety tests they would have probably otherwise passed. Suppliers are taxed. Investors are wary.

Hans Greimel over at Automotive News has a story about how Toyota is joining a larger corporate shift in Japan to reconsider what an employee-employer relationship should look like as the company tries to slow down.

Executives likened the pause to “pulling the andon,” the Japanese term for the cord factory workers pull to stop the assembly line when they spot a problem and need to troubleshoot.

“Existing workloads should be reduced for the time being,” Sato said in May. “We should question whether a particular work is necessary or not. We might need to stop certain types.”

Will Toyota actually go for a four-day workweek? Maybe not. The overall goal is to achieve a work/life balance, whatever that means.

What I’m Listening To While Writing TMD

This is not my joke, but someone today reminded me that the real song of the summer has been/will always be Len’s “Steal My Sunshine.” And, look, I don’t want to get too political, but there’s been a real vibe shift this week and I think we can all appreciate a little Len right now.