An internal report from Tesla leaked: The star project Cybercab was collectively opposed by executives.

Tesla has been steadfastly promoting and advancing its robotaxi project, Cybercab, over the past year, with many investment banks viewing it as one of the drivers to increase its future valuation. However, according to media interviews with several company insiders, the project's initiation appears to have been a unilateral decision by Musk, with significant internal opposition.

It is reported that at the end of February 2024, Tesla held a final debate on the new economy EV, Model 2, which was previously rumored to be Tesla's main push for a $25,000 car model. However, insiders revealed that during a meeting convened by Musk, the project was ultimately canceled.

At that time, Tesla's car project head Daniel Ho, senior vice president of engineering Drew Baglino, business development and policy head Rohan Patel, vice president of car engineering Lars Moravy, and chief designer Franz von Holzhausen all urged Musk to approve the production of this new $25,000 car model.

But Musk believed that launching an ordinary $25,000 car was meaningless and completely contrary to Tesla's beliefs. Instead, Musk approved the Cybercab project, also known as the robotaxi or Robotaxi.

This decision is seen as a sign of Tesla's transformation from an EV manufacturer to an AI car company focused on autonomous driving.

The prospects for autonomous taxis are not promising.

Over the past five years, Tesla has only launched one new car, the Cybertruck, which has been a commercial failure. This has raised doubts among some investors about Musk's decision-making, and this sentiment may further ferment.

An internal survey report during the early stages of the Cybercab project indicated that Tesla executives had a premonition that the commercial prospects for robotaxis were not optimistic. The model showed that the returns from Full Self-Driving (FSD) and Robotaxi would be slow and unstable, especially due to the lack of a regulatory environment, which could make it difficult to expand taxi services outside the US.

This report was completed by a team led by Musk's most trusted assistant, Drew Baglino. The report assumed that most car sales in the future would be contributed by fleet operators, and vehicles would be mainly used for ride-sharing services, with individual consumers also tending to use more autonomous taxis.

Baglino's analysis also adopted many assumptions proposed by Musk, such as US car sales plummeting from 15 million to 3 million annually. In a series of optimistic scenarios, the report calculated a potential demand for 1 million autonomous cars annually in the US. However, considering competition, Robotaxi would struggle to reach Tesla's current sales level of around 600,000 units annually in the US.

From a revenue perspective, the report suggested that besides the initial sales revenue of $20,000 to $25,000, Tesla could also earn up to three times the car's selling price through fare-sharing with fleet operators.

But this expectation is far below Musk's previous vision. In 2019, he proposed that autonomous driving would help each Tesla car reach a value of $100,000 to $200,000.

The internal report finally emphasized that robotaxis face difficulties in expanding into other markets, and therefore are limited by scale and profitability, which could lead to Tesla sustaining losses for several years in the future.

However, Musk dismissed this analysis report and unilaterally approved the Cybercab project.

The editor-in-chief of the EV publication Electrek pointed out that one of his major concerns about Tesla is that Musk may not have management partners around him who can help him stay rational. Additionally, this investigation may also confirm his suspicion that the strategic shift is one of the reasons for the excessive loss of top talent at Tesla last year.

In October 2024, within less than ten days, Tesla's chief information officer Nagesh Saldi, public policy head Jos Dings, Model X project manager David Zhang, and car project head Daniel Ho all resigned. Prior to this, nearly one-third of Tesla employees who reported directly to Musk had already chosen to leave.