30th November 2023 – (Texas) Tesla, the pioneering electric vehicle manufacturer, is gearing up to commence deliveries of its highly-anticipated Cybertruck electric pickup, which has faced significant delays. CEO Elon Musk recently addressed investor expectations, acknowledging the difficulties associated with scaling up production of what he described as a “radical” product.
The Cybertruck holds immense importance for Tesla as it represents the company’s first new model in nearly four years and plays a crucial role in maintaining its reputation as an innovator in the automotive industry. As Tesla grapples with a decline in electric vehicle demand and intensifying competition, the success of the Cybertruck is vital for driving sales, albeit not to the extent of the company’s high-volume Models 3 and Y.
Musk candidly admitted last month that the Cybertruck venture had its challenges, stating, “We dug our own grave with Cybertruck.” He cautioned that it would take between one and a half to two years for the vehicle to become a significant contributor to the company’s cash flow.
The pricing details for the Cybertruck are set to be unveiled at an event scheduled for 3 p.m. ET (2000 GMT). Despite rising raw material costs, Musk has not provided an updated price since initially announcing a $40,000 price tag for the truck in 2019.
In the lead-up to the launch, Musk made headlines for a profanity-laden interview with the New York Times, where he expressed his disdain for advertisers who had abandoned his social media platform, X (previously known as Twitter), due to anti-Semitic comments. He also encouraged customers who may not personally like him to evaluate Tesla’s products based on their quality, including their electric vehicles.
Musk envisions Tesla achieving an annual production rate of approximately 250,000 Cybertrucks by 2025. However, he acknowledged that the company has faced significant hurdles in ramping up production due to the Cybertruck’s innovative technology and unconventional design.
Experts believe that the Cybertruck’s new body material and futuristic styling, while adding complexity and costs to production, may not resonate with traditional pickup truck buyers who prioritize utility.
During the vehicle’s unveiling in 2019, Musk attempted to showcase the truck’s durability by striking its “armour glass” window with a sledgehammer, only to have it shatter. In the past, Musk had floated the idea of offering a more conventional-looking truck design if the Cybertruck’s futuristic aesthetics did not appeal to consumers. However, he has since emphasized the model’s innovation during conference calls and interviews.
Eric Noble, president of automotive consulting firm The CARLAB, noted that the Cybertruck may face challenges in attracting traditional pickup truck users, stating, “The larger problem for the Cybertruck is the Cybertruck wasn’t really designed for pickup truck users.” He added that it would likely have a narrower appeal compared to popular models like the Dodge Ram and Ford F-Series.
Despite being two years behind schedule, the Cybertruck enters a highly competitive and lucrative pickup truck market, where it will contend with rivals such as Ford’s F150 Lightning, Rivian Automotive’s R1T, and General Motors’ Hummer EV.
Rivian’s R1T starts at $73,000, while the F-150 Lightning has a starting price of around $50,000. Seth Goldstein, an equity strategist at Morningstar, expects the Cybertruck to be priced between $50,000 and the low $70,000 range.
With over a million reservation holders who have placed $100 deposits, the Cybertruck has garnered significant interest. Analysts predict that, similar to Tesla’s previous products, the Cybertruck will primarily appeal to affluent early adopters, suggesting that it will have a smaller audience compared to Tesla’s SUV models but may still perform remarkably well in the market.