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Tesla shares in focus today as CEO Elon Musk said that the stock price shows the company isn't a good place. He said he's committed to still be Tesla's CEO in five years. For more on the latest from the EV maker, let's welcome in Jed Dorsheimer, William Blair group head of Energy and Sustainability Research Sector. Uh Jed, it's good to see you here. Now, um, this seems to be, rather than than a pivot point for Musk, this seems to be sort of the last point in his recent pivot, if that makes sense. In other words, he sort of has made a recommitment to the company. We've seen that on the earnings call. We've heard him talk about it. And then this latest comment just sort of seeming to solidify it. Is that how you see it and is it a positive for Tesla?

Good to see you.

I think it's always been solid. Right. I don't think that Elon's commitment has wavered at all in terms, I mean, I think there's been media around that. But, um, I think what it does, though, is it reinforces. If you look at the value of Tesla, you know, I've said this that if you look at Tesla and you say it's just an auto company, well, then it would be, you know, significantly overvalued, right? It would be a short if you looked at it from that perspective. Tesla is a juggernaut of innovation. And so and at the heart and central to that has been Elon, you know, is the steward of that ship. So what we got today was kind of that affirmation from Elon that he's not going anywhere. And I think as the company looks at morphing once again in terms of the product portfolio and the drivers to this business, I think that is critical to make sure that he is is going to be the one at the helm.

And speaking of Tesla innovation jet, Robo Taxis on the way, right? I'm curious as analyst knows this company very well. When you think about that broader Robo Taxi market Jed, what it is, what it could be, how do you sort of compare and contrast Tesla and Waymo in that market?

Um, it is a good question. I mean, our focus on Tesla has been on the energy side of the business, which is 14% of sales but 25% of the profitability and I think we've been pretty right on on that. Um, the Robo Taxi has kind of been this moving target, you know, for the past few years, uh, and now we're really coming to the point of launching the uh, the beta in Austin, Texas. Um, and, you know, I think there are probably ways that Tesla can have an advantage in terms of that true vertical integration, which um, which Waymo doesn't have. And the, the, you know, point counterpoint between the two has been whether lidar versus camera. And I think at this point, um, you know, from a scalability and a cost perspective. And so the ability if Tesla can prove out Robo Taxis successfully with the visual versus the lidar system, that means that the the profitability for Tesla is going to be far greater than what uh Waymo would be able to uh achieve. But that is a risk factor around uh, around both of them. And uh, and we have yet to see Tesla kind of prove that out in the real world. So this is going to be critical, um, for the future of uh, of Tesla's business model.

And that's because the camera system is less expensive than the lidar system, Jed?

Oh, yeah, yeah. Uh, you know, by, you know, so I think the cost structure is, you know, like 100 grand for a Waymo, you know, compared to, so it's it's fractions. It's, um, you know, would be pennies on the dollar in the in the comparison. So that gives a, you know, major advantage to Tesla, um, as long as they can kind of prove out that the neural network, um, has the the efficacy and the safety, uh, associated with that.

Jed, let's say uh that EV tax credit Jed goes bye-bye. That $7,500 gets repealed. What does that mean for Tesla?

Well, the stock would go lower in my opinion. You know, the where, you know, that will have a margin contraction and so that is the other risk that's on the table as we go into, uh, you know, moving over to um Robo Taxi uh because if you get rid of the tax credit, that's going to be a headwind on overall EV demand uh in the US and that would uh hit the the margin structure. Um, because autos still are the largest product on the business model. So if that is your, if you have high conviction that that is going to go away and that um, uh then, you know, there could be a, there could be volatility in an air uh air pocket before you get to we see the Robo Taxi ramp.

All right, good to know. Lots of stuff to watch when it comes to Tesla. Jed, thank you so much.

Thank you, guys.