Elon Musk boldly claims Tesla (NASDAQ: TSLA), currently valued at $902.7 billion, could surpass a $10 trillion market cap, outstripping the combined worth of giants like Nvidia. However, Tesla’s struggling automotive business casts doubt on this vision. In Q1 2025, vehicle deliveries fell 13% year-over-year to 337,000 units, while automotive revenue dropped 20% due to aggressive price cuts. Profit margins shrank to 7.4% over the past 12 months, and the Cybertruck’s lackluster performance offers little relief. With sales declining in key markets—China, Europe, and the U.S.—and no new models announced, Tesla’s core business faces headwinds.
Musk pins hopes on the Optimus Robot, a humanoid AI bot projected to generate $10 trillion by selling 100 million units at $100,000 each. Yet, Tesla has only showcased remotely controlled prototypes, and experts question demand for even 1 million units annually. Competitor Waymo’s 250,000 weekly robotaxi rides highlight Tesla’s lag in autonomous tech.
Tesla’s stock, trading at $298.26 as of May 9, 2025, carries a lofty price-to-earnings ratio of 150, far above the auto industry’s typical 10. Down from $300 in 2021, it remains overvalued, analysts warn, given the 20% revenue decline. While Musk’s Cybercab and autonomous dreams persist, skeptics urge caution, citing Tesla’s unproven ventures and persistent operational challenges. Investors are advised to steer clear until tangible progress emerges.