Tesla CEO Elon Musk's OpenAI Gambits Raise Concerns Amidst Increasing Competition
One Wall Street analyst has expressed concerns that Tesla CEO Elon Musk's proposed acquisition of OpenAI could be a distraction for the company during a critical juncture. The analyst cited Tesla's recent shift toward physical AI, while Musk's bid for OpenAI represents a significant discount from its previous valuation.
The bid comes amidst intensifying competition in the electric vehicle (EV) and autonomous vehicle (AV) markets, which could potentially limit Tesla's profitability. The analyst highlighted Google's Waymo expansion in the US and BYD's embrace of DeepSeek for autonomous driving as examples of this competition.
Furthermore, Tesla faces challenges in China, with BYD lowering the price of its entry-level model and XPeng offering incentives to customers. Musk's outspoken political stances and his role in the Trump administration have also been cited as potential risks for Tesla's sales in California and the EU.
Sales in Europe have been particularly challenging for Tesla, with sharp declines in Germany, France, Norway, and the UK. In the Netherlands, a significant portion of Tesla owners are reportedly considering selling their vehicles due to Musk's political views.
Tesla's recent fourth-quarter delivery figures fell short of analyst estimates, and the company reported its first year-over-year decline in vehicle deliveries. The analyst maintains a neutral rating on Tesla, but notes that Musk's public persona could pose risks for the company's long-term performance.