Despite 71% Profit Drop, Elon Musk Remains Confident: Tesla Will Become the iPhone of Cars.

In a bold statement during Tesla Inc.’s first-quarter earnings call, CEO Elon Musk made a prediction that has shaken the automotive industry.

Despite a staggering 71% drop in profits, Musk expressed unwavering confidence in Tesla’s future, forecasting that car ownership will soon become obsolete.

Musk framed this shift as an inevitable change, likening traditional gasoline-powered vehicles to outdated technologies like flip phones in an era dominated by smartphones.

His vision for Tesla? To become the “iPhone of cars,” revolutionizing the automotive industry in the same way Apple Inc. transformed the smartphone market.

The Bold Statement: Musk’s comments came as a response to an inquiry from Pierre Ferragu, an analyst at New Street Research.

Ferragu questioned why Tesla’s Model 3 and Model Y hadn’t captured a larger portion of the global market, especially when these models were hailed as revolutionary products in the electric vehicle (EV) space.

Musk’s response was a stark and provocative one, suggesting that the future of cars lies in autonomy, with electric vehicles (EVs) like Tesla leading the charge.

In Musk’s words, “In the not too distant future, buying a gasoline car that is not autonomous will be like riding a horse while using a flip phone.” Musk believes that traditional cars, especially those powered by gasoline, are on the brink of extinction, and that the future of personal transportation will revolve around fully autonomous electric vehicles.

Ferragu, after the earnings call, took to social media platform X (formerly Twitter) to share his interpretation of Musk’s vision. He stated, “My interpretation of Elon’s response: Tesla will become the iPhone of cars when it is fully self-driving.”

This comparison highlights Musk’s ambition to make Tesla the go-to choice for car owners in the same way that Apple’s iPhone has become the dominant force in the smartphone market.

Tesla’s first-quarter results for 2025 showed a 9% decline in revenue compared to the same period last year, totaling $19.34 billion. The company’s revenue fell short of Wall Street’s expectations, which had forecasted a figure closer to $21.35 billion.

This marks a concerning development for the EV giant, especially as it faces increased competition from both established automakers and startups in the EV space.

Despite this financial setback, Musk remains optimistic about Tesla’s future. He reaffirmed that Tesla’s plans to launch more affordable EV models are progressing as scheduled. Production for these more budget-friendly models is set to begin in the first half of 2025.

This move aims to make Tesla’s vehicles accessible to a broader audience, which could help the company maintain its dominance in the global EV market.

Tesla also revealed that its highly anticipated Robotaxi service, referred to as the Cybercab, is on track to enter volume production in 2026. Musk envisions a future where the majority of Tesla vehicles operate autonomously, offering a new form of shared transportation that could reduce the need for car ownership altogether.

The Robotaxi service, in Musk’s eyes, will be integral to Tesla’s mission of redefining the future of personal transportation.

The Rise of Full-Self Driving Technology: Tesla’s Full-Self Driving (FSD) technology has long been at the core of Musk’s vision for the future of mobility. Earlier this month, Tesla disclosed that its Giga Texas production facility uses Unsupervised Full-Self Driving technology to transport vehicles from the production line to the outbound logistics lot.

While this move represents a significant leap forward for Tesla’s autonomous capabilities, it also highlights the company’s commitment to pushing the boundaries of self-driving technology.

Tesla’s FSD system relies on a camera-based approach, which, although innovative, is considered less precise than the LiDAR-based systems used by competitors such as Alphabet Inc.’s Waymo. Waymo has logged more than 20 million miles of real-world autonomous driving, significantly outpacing Tesla in terms of on-the-road experience.

Despite this, Musk remains confident that Tesla’s FSD technology will continue to evolve and improve, with the company making strides toward achieving fully autonomous driving.

However, Tesla’s FSD system has faced considerable criticism from experts in the field. Critics argue that Tesla’s camera-based system lags behind the more accurate and reliable LiDAR-based systems, and some have voiced concerns over Tesla’s aggressive marketing of its FSD capabilities, despite the technology not yet being fully capable of fully autonomous driving without human intervention.

This ongoing debate over the effectiveness and safety of Tesla’s self-driving technology raises questions about the company’s ability to realize Musk’s vision of the future.

The Self-Driving Debate: The broader debate surrounding self-driving technology remains unresolved. On one hand, companies like Waymo and Cruise are making significant progress with their autonomous vehicles, accumulating millions of miles of real-world driving data.

On the other hand, Tesla’s FSD technology, while impressive, has yet to achieve full autonomy. Experts continue to debate whether Tesla’s reliance on cameras for its FSD system will be sufficient in the long run, or if a more robust sensor suite, such as LiDAR, is necessary to achieve true autonomy.

The challenges Tesla faces in the realm of autonomous driving are not only technical but also regulatory. Governments around the world are still grappling with how to regulate self-driving vehicles, with various countries taking different approaches to the testing, deployment, and safety standards of autonomous vehicles.

Musk’s aggressive timeline for achieving full autonomy may face delays as regulators catch up with the pace of technological development.

The Vision for the Future: Despite these challenges, Musk’s long-term vision for Tesla remains clear. He believes that the future of transportation is electric, autonomous, and shared. Musk envisions a world where personal car ownership is no longer the norm.

Instead, vehicles will be used as part of a shared, autonomous fleet, reducing the need for individuals to own cars altogether. This shift would fundamentally transform the way society thinks about mobility, and Tesla is positioning itself to be at the forefront of this revolution.

Tesla’s ambition to become the iPhone of cars is not just about creating a better electric vehicle; it’s about creating an entirely new way for people to interact with transportation. The company’s focus on autonomy, shared mobility, and sustainability could redefine the automotive industry, even if its journey is fraught with challenges.

Conclusion: Elon Musk’s assertion that Tesla will become the “iPhone of cars” encapsulates his bold vision for the future of transportation. Despite financial challenges and the ongoing debate about self-driving technology, Musk remains confident that Tesla’s innovations will lead the way toward a future where car ownership is no longer necessary.

Whether or not this vision comes to fruition remains to be seen, but one thing is certain: Musk’s ambition to transform the automotive industry is unwavering, and Tesla will continue to push the boundaries of what’s possible in the world of electric vehicles and autonomous driving.

Tesla’s financial challenges in Q1 2025 should not overshadow the company’s long-term goals. With affordable models, Robotaxis, and cutting-edge self-driving technology on the horizon, Tesla’s roadmap for the future is an exciting one.

Only time will tell whether Musk’s lofty predictions will become a reality, but for now, the company’s pursuit of autonomy and sustainability is leading the charge in shaping the future of personal transportation.