A longtime Tesla (TSLA) backer says he’s no longer betting big on the company’s self-driving vision, warning that its core technology may not deliver on years of promises.
In a new Bloomberg interview, Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management, says his firm has cut its Tesla position by more than half, citing concerns about valuation, execution, and the stalled progress of the company’s full self-driving (FSD) program.
Gerber says the decision reflects both waning confidence in Tesla’s autonomous strategy and discomfort with the stock’s premium price.
“We’ve cut it, our position, by 60%. So that’s fairly large… We’re not recommending to buy Tesla or per se more likely recommending to sell Tesla for investors up at these prices because you’re getting such a premium valuation, but in general, we’ve just been holding the stock because we’re kind of stuck with our position right now.”
Gerber says he no longer believes Tesla’s current approach to full self-driving can succeed. The system’s reliance on vision-only sensors, he argues, represents a fundamental flaw that engineers may not be able to overcome.
“I don’t know what’s going to happen with full self-driving. I just don’t think it works. And I think vision-only systems don’t work. And I’m very sure of this now. Even though I’m not an engineer, I can explain to you how humans drive. And I don’t think Elon gets how humans work. I think he gets how machines work.”
He adds that while Tesla’s long-term potential remains tied to solving autonomy, its value proposition weakens if its driver-assistance technology continues to underperform competitors such as Waymo.
“If they can solve full self-driving, like I could get in my car right now and push a button and it drives me home, like I can get in a Waymo right now and it’ll drive me home, no problem. Then I think Tesla has a reason to buy the stock because now they’ve got their products working, and they can grow from there. But as far as waiting for robots and cabs to pay off, it doesn’t matter if full self-driving doesn’t work and full self-driving doesn’t work.”
Gerber’s comments come following Tesla’s Q3 2025 earnings report, where the electric vehicle maker posted revenues of $28.1 billion, up 12% year over year. But income from operations fell 40% to $1.6 billion as operating expenses surged 50% year over year to $3.4 billion.
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