Investor 'bets' $10,000 against Elon Musk's Tesla project in fiery email
Former hedge fund manager Whitney Tilson blasted Tesla CEO Elon Musk's latest robotaxi rollout plan in an email to investors this week.
The 52-year-old, who ran Kase Capital Management for roughly two decades before shutting it down in 2017, said he was willing to bet $10,000 that Musk will fail to reach his goal of getting robotaxis — which the automotive company has compared to a driverless Uber or Lyft — on the road by 2020.
“I feel very confident predicting autonomous robotaxis for Tesla next year,” Musk said last month during Tesla’s Autonomy Day in California. “Not in all jurisdictions because we won’t have regulatory approval everywhere, but I’m confident we will have … regulatory approval somewhere, literally next year.”
Musk recently estimated 1 million Teslas would have full autonomous capabilities in about a year, giving customers the opportunity to join Tesla's taxi network and earn some extra cash on rides through the company's ride-sharing app. Tesla would take up to 30 percent of the profits earned per trip.
But Tilson claimed Musk's timeline is far from realistic.
"Tesla Inc. is a zillion miles from Musk’s promise of Level 5 by the end of this year and a fleet of a million robotaxis by the end of next year," argued Tilson in an email that was later posted on business site ValueWalk.
"You want to do a bet for charity that Tesla doesn’t come within a year of either of those promises (on that back of which, he raised over $2 billion)?" he then asked, adding that he would "extend this bet to anyone – up to $10,000."
Directing investors' attention to a Tesla video about a vehicle's autopilot functions, Tilson said it proves the automotive giant is far from reaching Level 5 autonomy — which The Verge describes as an autonomous car with "no geofence" and "no limitations." There are currently no cars in existence that have reached that level of autonomy, the publication points out.
"If you don’t have the time to watch it, I’ll summarize it for you: Autopilot is LAUGHABLY BAD. The driver had to intervene dozens of times – every few seconds, it seemed – to avoid MAJOR accidents," Tilson commented.
“Elon’s claims are FAR from being reality,” he concluded.
Musk has admitted in the past that he's not always "on time" but argued that, in the end, he "gets [the job] done." Last week, the 47-year-old billionaire businessman said he works "between 80 and 90 hours a week" to ensure his company's success.
"In recent years, hours were much higher. Don’t recommend though — bad for health & happiness. But no choice or Tesla would die. Hope to reduce to 80 hours next year," he wrote on Twitter.
Running Tesla has been particularly challenging for Musk. The automotive company reported a $702 million loss in the first quarter of 2019.
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"It is incredibly difficult to survive as a car company. Incredibly difficult," he previously told Vox, noting there were some weeks he worked up to 120 hours.
Fox Business' Brittany De Lea contributed to this report.