If one wants to understand why Tesla (TSLA) has become such a polarizing company -- creating legions of both fanatical bulls and fanatical bears -- reading a pair of Tuesday tweets from Elon Musk wouldn't be a bad place to start.
In the first tweet, which at the time of this article has been liked or retweeted about 129,000 times, Musk proclaimed that Tesla produced no cars in 2011, but will produce around 500,000 in 2019.
Tesla made 0 cars in 2011, but will make around 500k in 2019— Elon Musk (@elonmusk) February 20, 2019
In the second tweet, which was published more than four hours later and currently has about 39,000 likes and retweets, Musk clarified that he really meant to say Tesla would (as suggested in its Q4 shareholder letter) achieve an annualized production rate of "probably around" 500,000 vehicles by year's end. He added that his company still expects 2019 vehicle deliveries to be around 400,000 (that's slightly above an analyst consensus estimate of 389,000).
Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.— Elon Musk (@elonmusk) February 20, 2019
Die-hard Tesla bears undoubtedly saw the tweets as another example of how Musk, who last year got in hot water with the SEC and DOJ after inaccurately tweeting that Tesla had secured the funding needed to be taken private at a price of $420 per share, routinely makes claims and promises about Tesla product launches and production goals that he can't back up.
Die-hard Tesla bulls, on the other hand, are likely to brush off the inaccuracy of Musk's original tweet as another case of Elon being Elon, and instead argue that getting from zero vehicle deliveries to around 400,000 per year over the course of 8 years (assuming, of course, that Tesla hits its 2019 target) is still a very impressive feat for an electric car maker.
All of this is relevant to how bulls and bears are reacting to Musk's latest comments about Tesla's self-driving efforts, and also to what degree those comments are worth believing.
In a podcast with investment firm ARK Invest, Musk claimed Tesla, which is working on a third-gen Autopilot system that will be powered by an internally-developed processor, will make a self-system available by the end of this year. "I think we will be feature complete, full self-driving, this year -- meaning the car will be able to find you in a parking lot, pick you up and take you all the way to your destination without intervention, this year. I would say I am of certain of that," he said.
Musk qualified his remark by saying that such a system won't work perfectly 100% of the time and require no observation. However, he suggested that such a system could be available by the end of 2020.
"My guess as to when we would think it is safe for somebody to essentially fall asleep and wake up at their destination? Probably towards the end of next year," Musk said. "That is when I think it would be safe enough for that."
It's worth remembering here that back in Oct. 2016, and again in June 2017, Musk promised that a Tesla would be able to do an autonomous, cross-country trip by the end of 2017. "Essentially, November or December of this year, we should be able to go all the way from a parking lot in California to a parking lot in New York, no controls touched at any point during the entire journey," Musk said in June 2017.
That trip still hasn't happened. In September, Musk said the trip will "probably" happen after the alpha build of Version 10 of the software powering Tesla's Autopilot driver-assistance system is released. Time will tell.
It's also worth noting that while some automakers are hoping to launch cars that support Level 4 autonomy (able to take over from human drivers in some, though not all, environments) in 2021, no third party working on autonomous driving systems has set goals as ambitious as the ones Musk just set, at least not for cars that will be sold to consumers.
Alphabet's (GOOGL) Waymo, which has a decade of major R&D investments under its belt, recently launched a driverless ride-sharing service for select consumers in the Phoenix area (a near-ideal testbed for autonomy) and wants to bring such a service to other cities. However, it hasn't announced any deals yet to integrate its technology within cars sold to consumers. Likewise, General Motors' (GM) Cruise self-driving unit is merely hoping to launch a driverless ride-sharing service in San Francisco in 2019 -- and even that's not a sure thing.
And in a recent interview with TheStreet, Sherif Marakby, the head of Ford's (F) autonomous driving unit, suggested the arrival of fully-fledged autonomous cars that are sold to consumers could take a lot longer that the arrival of driverless taxi services.
"The ultimate goal of someone getting in a car, owning the car, pushing a button and saying 'I want to go to this place' -- that's far out, because it's way beyond just mapping an area and doing the work," Marakby said. "This is going through what's going to happen on the environment, in the streets, in the weather, and I think that's going to be a tall order."
However, just as one might look at Musk's tweets about 2019 vehicle production and argue that Tesla has made a lot of progress in ramping vehicle production even if Musk's original tweet wasn't accurate, one could argue that Tesla's Autopilot system has advanced considerably since first launching in 2014. And that -- with the help of new Autopilot hardware and the driving data the company is collecting from current Autopilot systems -- Tesla will quite possibly make real progress over the next two years towards creating self-driving systems, even if the company fails to hit the very ambitious targets that Musk just set for the end of 2019 and the end of 2020.
For someone who (like yours truly) isn't fervently bullish or bearish on Tesla, but instead sees it as an innovative and pioneering company with a somewhat-rich valuation and a very shaky track record of making good on its big promises -- maintaining a level-headed approach to following Tesla presents a unique set of challenges.
It requires taking many of the claims and predictions made by the company and its larger-than-life CEO with a spoonful of salt, but also requires not losing sight of the actual progress being made by the company as it fails to deliver on one target or another.