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Notably apolitical
As I look back over my notes from the Tesla Q4 earnings call, it’s worth noting how apolitical it was, especially considering Elon Musk’s current position inside the beltway. When asked about President Trump’s position on EVs — which includes ending all incentives to encourage sales — Musk took a neutral tone and talked around the question.
“At this point, I think that sustainable transport is inevitable,” he said. “I’m highly confident that all transport will be autonomous electric, including aircraft, and that it simply can’t be stopped any more than one could have stopped the advent of the external combustion engine, steam engine, or one could have stopped the advent of the internal combustion engine.”
In the one-hour call, Trump’s name came up twice — and not by Musk.
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And that’s a wrap
Tesla’s Q4 earnings call is over, and Elon Musk and other executives touched on a lot of subjects, including battery packs being a constraint to work through in 2025, Optimus taking on boring jobs in Tesla factories, and the company intending to launch a paid ride-hailing service in Austin this coming June. Oh, and yup — if you have a hardware 3 vehicle and want to fully unlock FSD, you’re going to need a hardware upgrade.
The call is over, and the song “Soft Words” by Ben Fox fades in the background. Until next time … -
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The China FSD workaround
Tesla hopes to launch Supervised FSD in China this year, but Musk said getting the tech ready for that “gigantic market” has been a challenge.
“They won’t currently allow us to transfer training video outside of China, and then the U.S. government won’t let us do training in China, so we’re in a bit of a bind there,” Musk said.
Tesla’s solution? To feed publicly available videos of China’s streets — complete with street signs and traffic rules — into Tesla’s FSD training and simulator.
Wut?
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More confusion on the new, cheaper models
I will not get into the whole thing here — that’s why I wrote this explainer last October — but Tesla once was working on a $25,000 car to be built on the same next-gen platform that will power the upcoming Cybercab.
That changed, and now Tesla is working on mysterious new models that will be built on existing production lines and will likely cost more than $30,000.
Tesla has been saying, including in today’s shareholder letter, that those new models “remain on track for start of production in the first half of 2025.” But then CFO Vaibhav Taneja very clearly said on the call that the company is launching “a more affordable model in the first half of 2025” — clearly using the singular.
We’d ask Tesla’s press team to clear this up, but Musk disbanded it years ago.
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Yeah, you’re gonna need a hardware upgrade
Tesla CEO Elon Musk was asked during the call if so-called hardware 3 vehicles with FSD (the advanced driver-assistance system) would require a hardware upgrade. That question matters because hardware 4 vehicles have a faster FSD computer compared to hardware 3 and Elon has repeatedly said an upgrade wouldn’t be required to unlock the full, and frequently updated, FSD software.
Welp … things change.
“I mean, I think the honest answer is that we’re going to have to upgrade people’s hardware three computer for those that have bought full self-driving and that is the honest answer,” he said. “And that’s going to be painful and difficult, but we’ll get it done now. I’m kind of glad that not that many people bought the FSD package.”
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A tariff hit is coming
CFO Vaibhav Taneja said in his remarks that the “imposition of tariffs” is “very likely” and “will have an impact on our business and profitability” in 2025. Musk’s buddy President Trump has threatened a wide range of tariffs on imports from China, Canada, and Mexico.
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Optimus will be used in Tesla factories for the boring tasks
Musk said the company expects to “close the loop with Optimus” this year and will use the robot internally at Tesla. “We obviously can easily use several thousand human robots at Tesla for, you know, the most boring, annoying tasks in the factory, like the task nobody wants to do, where we have to, like, beg people to do this task,” he said.
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Bitcoin makes a financial cameo
Tesla CFO Vaibhav Taneja noted that the automaker’s net income in Q4 was “impacted by a $600 million market benefit from bitcoin due to the adoption of a new accounting standard for digital assets.” He said that Tesla would adjust its other income in future reporting periods going forward.
It’s worth noting that in 2023, Tesla recorded a $204 million loss on its bitcoin holdings. Times have changed.
Remember that time Musk said you could buy a Tesla with bitcoin? -
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The Optimus supply chain
Musk noted during Tesla’s earnings call that the company aspires to ramp production of Optimus by “an order of magnitude” per year. But first, Tesla needs an entirely new supply chain for its “entirely new technology.”
Musk said there was nothing off the shelf to use to build the Optimus. “We tried desperately with Optimus to use any existing motors, any actuators, sensors — nothing worked for a human robot hand at any price. We had to design everything from physics first principles.”
He said the Optimus robotic hand will be able to play the piano or thread a needle.
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Tesla to bring self-driving service to Austin?
Our collective eyebrows rose when Elon Musk said self-driving vehicles were coming to Austin this week. Yes, really.
Here is senior reporter Sean O’Kane’s article detailing Musk’s claims, which he made during Tesla’s Q4 earnings call. TL;DR: Musk said his company will launch a paid ride-hailing robotaxi service in Austin, Texas, this coming June, the latest in a long line of sky-high promises he has yet to meet about autonomy.
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Constraints to growth in 2025
After making his typical bullish opening — “self-driving wolf,” “epic,” and “ridiculous” — Musk turned to some reality. Namely, constraints on growth.
Musk said the biggest constraint in 2025 is battery packs.
“We’re working on addressing that constraint, and I think we will make progress on addressing that constraint, and then things are really going to go ballistic next year, and really ballistic in ’27 and ’28,” Musk said Wednesday during a webcast after earnings.
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Musk is amped up
The call has started and Musk has maybe the most jittery energy I can recall on one of these earnings calls. In the span of a few minutes he:
- Gleefully criticized the script he was reading from — it said Tesla was “doubling down” on autonomy, but Musk said he thinks Tesla is “10X-ing” autonomy.
- Said he sees a path for Tesla becoming not only the most valuable company in the world, but also more valuable than the next five companies combined.
- Said Tesla is in for an “epic” 2026 as well as a “ridiculously good” 2027 and 2028, where he thinks the company will go “ballistic” (all non-GAAP terms, I’m assuming).
- Admitted to crying wolf “several times” but continued: “I’m telling you, there’s a damn wolf … It’s a self-driving wolf.
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Live
Transportation
Tesla earnings live updates: Promising ‘return to growth’ and cheaper cars
Tesla’s fourth-quarter and full-year earnings day is here — a highly anticipated report that is expected to be released after market close Wednesday. Tesla management, which will likely include CEO Elon Musk, will hold an earnings call at 5:30 p.m. ET.
This is the company’s first earnings call since Musk took a prominent role in the U.S. government under the Trump administration.
Follow our live updates before, during, and after earnings drop for all the latest insights and news from Tesla.
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