'They're Nowhere Near Being Robotaxis': Bearish Tesla Analyst Says Musk Is Promoting 'Smoke And Mirrors,' Stock Is Overvalued

Zinger Key Points
  • Gordon Johnson joined Benzinga's PreMarket Prep to outline his bearish thesis on Tesla
  • Johnson argued that the company's robotaxi business has fundamental technology issues, and that Musk is promoting 'smoke and mirrors'

Gordon Johnson, the founder of GJC Research, joined Benzinga's PreMarket Prep Friday morning to discuss Tesla Inc TSLA amid the company's recent share-price rally, with the electric vehicle giant adding more than 40% in market value in the last month. Johnson outlined his bearish thesis on Tesla, and why he believes the stock is overvalued.

Here are Johnson's reasons for why he believes Tesla's share price will eventually fall below $30 a share.

Declining Margins: Johnson pointed out on PreMarket Prep that Tesla's margins are declining and that growth in car sales has declined, and that while Tesla does have other potential revenue streams on the horizon, the company still makes the vast majority of its income through selling cars.

"Effectively with Tesla, what you have is a company that I think that [Elon] Musk is promoting a lot of smoke and mirrors to hide the fact that he owns a car company with declining margins that has basically went ex growth," Johnson said.

Tesla reported lower revenue in Q1 of 2024 compared to its revenue in the same period last year, according to Benzinga Pro.

Read Also: Tesla Hints Cybertruck Was Most Sold EV Truck In US In Q2, But Elon Musk’s Company Has Not Released Data To Back It Up

The Problem With Robotaxis: Johnson also outlined a bearish thesis regarding Tesla's robotaxi business. He argued that while other companies, like Alphabet Inc-backed GOOG GOOGL Waymo, have operational robotaxis on the road, Tesla lacks lidar technology that makes robotaxis or true full-self driving feasible.

"If you simply go on YouTube and look at videos, you'll see that with these [Tesla] robotaxis literally they're driving around and within an hour without human intervention, these things would be crashing… they're nowhere near being robotaxis despite the fact that's what everyone calls them because Musk calls them that."

Click here to watch Johnson's full interview on Benzinga's PreMarket Prep. 

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Photo: Benzinga

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