Gary Black, the Managing Director of Future Fund LLC, has a different take on the future of Tesla Inc. (NASDAQ:TSLA) amid the company’s recent inclination towards autonomy and robots.
Black Skeptical Of Tesla’s Autonomy Push
Black took to X on Tuesday and highlighted the decline in Tesla’s global volumes and the company’s shift towards “unsupervised” autonomy and humanoid robots. Black dismissed this as a “fool’s narrative,” emphasizing that over 70% of Tesla’s profits come from electric vehicles (EVs).
Black also criticized Tesla bulls for ignoring the rise of autonomous ride-sharing in China, where Tesla lags behind local manufacturers. He questioned the justification for Tesla’s high valuation, given the competitive nature of the autonomous vehicle market.
He concluded by stating, “It’s difficult to justify TSLA’s forward P/E of 200x+ in what is clearly a commodity business (unsupervised autonomy) where TSLA is one of many fighting for market share.”
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Tesla Valuation Concerns Intensify
Needham analyst Chris Pierce, echoed Black’s concern and warned that half of Tesla's projected 2030–2035 gross profit depends on unproven businesses like ridesharing and robotics, leaving "limited valuation support" at current levels.
At the same time, Ross Gerber, co-founder of Gerber Kawasaki, cautioned in an interview that shifting Tesla's focus away from its core electric vehicle business — which he believes remains "wildly profitable" — would be a "strategic error" for Musk's company.
Sales Decline In China, Europe
Black’s comments come at a time when Tesla’s stock is underperforming. The company’s shares have been on a downward trend following reports of steep sales declines in China. Tesla's China sales plunged to 26,006 units in October — a 35.8% drop from a year earlier and its weakest monthly performance in three years, according to data from the China Passenger Car Association. The company's market share also tumbled to 3.2%, down from 8.7% in September, marking its lowest level since 2020.
Meanwhile, Tesla registrations in nine key European countries reportedly declined 36.3% year-over-year in October.
Black’s comments also follow the departure of Tesla’s Cybertruck and Model 3 program manager, which has raised further concerns about the company’s future prospects.
Benzinga's Edge Rankings place Tesla in the 77th percentile for quality and the 3rd percentile for value, reflecting its mixed performance. Check the detailed report here.
Price Action: On a year-to-date, Tesla Stock climbed 15.91%, as per Benzinga Pro. On Tuesday, the stock fell 1.26% to close at $439.62.
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