Finance

Tesla Stock Plummets After Robotaxi Debacle: What Went Wrong?

2025-06-25

Author: Jacob

Tesla is facing a bumpy road following the highly publicized rollout of its Robotaxi service in Austin. While the initial launch sparked a slight boost in stock prices, the momentum quickly shifted as reports began flooding in about malfunctioning autonomous cabs.

This past Tuesday, the fallout from the tumultuous Robotaxi debut caused Tesla's stock to tumble over four percent—an alarming drop of nearly $15 in just one day. The catalyst? A series of viral videos emerged, showcasing the self-proclaimed driverless vehicles, which still utilize human "safety monitors," behaving erratically and even breaking traffic laws.

Disturbing Footage Goes Viral

One particularly shocking video depicted a Robotaxi repeatedly slamming on its brakes near police cars, careening through intersections, and veering into oncoming traffic—all captured within a short 20-minute ride. Another unsettling clip revealed the Model Y's steering wheel jerking uncontrollably as it navigated through an intersection, crossing double-yellow lines in the process.

These concerning visuals didn’t just catch the attention of internet users; they were also noticed by the National Highway Traffic Safety Administration (NHTSA), which confirmed that they are investigating the incidents highlighted in the videos.

Investor Concerns Mount

In an investor note, former Tesla enthusiast Tom Narayan from RBC Capital Markets expressed his dismay over the unexpected presence of human safety monitors during the rollout. This revelation was a major disappointment for shareholders hoping to witness a transformative demonstration.

Narayan remarked, "Robotaxis are critical to the Tesla investment case." He emphasized that if the company can convincingly demonstrate its autonomous driving capabilities, it could outpace its competitors in both the driverless cab niche and the electric vehicle market. However, he added, with the current turmoil, success seems uncertain.

"Only time will tell if this will work," he concluded, highlighting the skepticism surrounding Tesla's future.

Waymo Takes the Lead

In the meantime, rival company Waymo is making strides as it expands its services to more cities, further distancing itself from Tesla's recent missteps. As questions loom over the Robotaxi rollout, it remains to be seen whether Tesla can regain consumer trust and investor confidence in its autonomous driving technology.

With the stakes high and the road ahead bumpy, Tesla has a lot to prove if it intends to reclaim its position as a leader in the EV and autonomous vehicle sectors.

Stay tuned for more updates on this unfolding story!