The entire value of the S&P 500 currently stands at $45.5 trillion, according to FactSet. Tesla CEO Elon Musk claimed on Thursday that his company’s Optimus humanoid robots could eventually make the automaker worth more than half of that.

Musk, who characterized himself as “pathologically optimistic” at the 2024 annual shareholder meeting in Austin, Texas, said Tesla is embarking on not just a “new chapter” in its life, but is about to write an entirely “new book.” Optimus appears to be one of the main characters.

Tesla first revealed its plans to work on humanoid robots in 2021 at an AI Day event, trotting out a dancer in a unitard that looked like a sleek, androgynous robot.

In January, Tesla showed off Optimus robots folding laundry in a demo video that was immediately criticized by robotics engineers for being deceptive. The robots were not autonomous, but were rather being operated with humans at the controls.

At the shareholder event on Thursday, Musk didn’t divulge exactly what Optimus can do today. He suggested the robots some day will perform like R2-D2 and C-3PO in Star Wars. They could cook or clean for you, do factory work, or even teach your children, Musk suggested.

As for shareholder value, Musk said Optimus could be the catalyst for lifting Tesla’s market cap to $25 trillion someday.

Speaking to a crowd consisting mostly of fawning fanboys in an auditorium at the Gigafactory, Musk promised Tesla would move into “limited production” of Optimus in 2025 and test out humanoid robots in its own factories next year.

The company, he predicted, will have “over 1,000, or a few thousand, Optimus robots working at Tesla” in 2025.

This is all far-out stuff even for Musk, who is notorious for making ambitious promises to investors and customers that don’t pan out — from developing software that can turn an existing Tesla into a self-driving vehicle with an upload, to EV battery swapping stations.

Getting to a $25 trillion market cap would mean that Tesla would be worth about eight times Apple’s value today. The iPhone maker is currently the world’s biggest company by market cap, just ahead of Microsoft.

At Thursday’s close, Tesla was valued at about $580 billion, making it the 10th most valuable company in the S&P 500.

Musk didn’t provide a timeframe for reaching $25 trillion. He did say that autonomous vehicles could get the company to a market cap of $5 trillion to $7 trillion.

Musk said he agreed with numbers from long-time Tesla bull Cathie Wood, the CEO of ARK Invest. This week, ARK put a $2,600 price target on Tesla’s stock by 2029, betting on a commercial robotaxi business that the company has yet to enter.

Wood’s price target equals a market cap for Tesla of over $8 trillion.

Musk’s comments at the annual meeting followed the shareholder vote to reinstate the CEO’s $56 billion pay plan, five months after a Delaware court ordered the company to rescind the package. The crowd cheered when the proposal was read aloud, and when preliminary results were announced.

Taking the stage following the readout of the shareholder votes, Musk said, “I just want to start off by saying hot d—! I love you guys.”

Tesla shares have dropped 27% this year as the company reckons with a sales decline that’s tied in part to an aging lineup of electric vehicles and increased competition in China. The company has also implemented steep layoffs. Musk has encouraged investors to look past the current state of the business and more toward a future of autonomous driving, robots and artificial intelligence.

Among his boldest claims on Thursday was Musk’s declaration that Tesla had advanced so far in developing silicon that it’s surpassed Nvidia when it comes to inference, or the process that trained machine learning models use to draw conclusions from new data.

Nvidia shares have soared almost nine-fold since the end of 2022, driven by demand for its AI chips. The company is now worth about $3.2 trillion.

One concern swirling around Musk is his focus on Tesla given all of his other commitments. He owns and runs social media company X, is CEO of SpaceX, and founded The Boring Co. and Neuralink. He launched another startup, xAI, in March last year and the company recently raised $6 billion in venture funding.

Musk was asked by a shareholder at the meeting how important he is, personally, to the future of Tesla.

“I’m a helpful accelerant to that future,” he said, emphasizing his role in innovation.

He said that, when it comes to humanoid robots, other companies, including tech startups, are going after the market. Competitors include Boston Dynamics, Agility, Neura and Apptronik.

“What really matters is, can we be much faster than everyone else and our product be done a few years before theirs and be better,” Musk said.

WATCH: Tesla shareholders approve Musk’s $56 billion pay package

Boeing‘s Starliner is a human-grade space capsule designed to take astronauts to and from the International Space Station. Boeing began work on the capsule in 2014, when it signed a $4.2 billion contract with NASA under the agency’s Commercial Crew Program.

NASA also selected SpaceX for the job, giving Elon Musk’s company $2.6 billion to develop its Crew Dragon capsule.

“The entirety of the Commercial Crew Program was very much a new venture,” said Caleb Henry, director of research at Quilty Space. “Prior to that, NASA relied on a lot of its own engineering talent to get humans to the space station.”

Henry said the program allowed NASA to offload “some of those responsibilities to the private sector.”

“There was some reticence in Congress towards this type of approach,” he said. “It was only because Boeing threw its hat in the ring that Congress and by extension, NASA, were confident enough to actually go forward with this program.”

In the decade since, Boeing has struggled to deliver on the six missions it’s contracted to fly with NASA.

Of the nearly $5 billion Boeing has received to develop Starliner to date, the company has spent $1.5 billion to cover delay overruns. Boeing recently launched its last test, a milestone crewed mission, which it needs to complete before NASA can certify Starliner to begin operational missions.

SpaceX, meanwhile, has completed over a dozen crewed missions to space, launching both NASA astronauts and private citizens since 2020.

Watch the video to learn more about the obstacles that Boeing has faced with its Starliner project and what the future may hold for its long-awaited capsule.

Tesla is being accused of taking steps to keep employees in Buffalo, New York, from unionizing, according to a complaint from the National Labor Relations Board.

On Tuesday, the NLRB’s regional director for Buffalo, Linda Leslie, filed the complaint. In it, she said Tesla “promulgated and maintained,” an acceptable use policy for workplace technology in 2023 that was meant to “discourage its employees from forming, joining, or assisting the Union or engaging in other concerted activities,” after allegations were raised by members of Workers United.

CNBC obtained a copy of the complaint through a Freedom of Information Act request.

The policy restricted Tesla workers from “recording, unauthorized solicitating [sic] or promoting,” and “creating channels and distribution lists,” among other things, the complaint said.

The NLRB also claims the policy had the effect of “interfering with, restraining, and coercing employees in the exercise of rights guaranteed” under the National Labor Relations Act, which generally protects workers’ rights to discuss organizing, join a union and collectively negotiate for better pay and working conditions.

The Tesla Buffalo plant was supposed to manufacture solar panels, but has been used more recently to assemble electric vehicle charging equipment, and to house a team of AI software data labelers.

Last month, the Buffalo plant was home to a number of job cuts put in place as part of a broader restructuring at the electric vehicle company. According to a WARN notice filed in the state, Tesla is laying off 285 employees in the state of New York, mostly at the Buffalo factory. The company is eliminating thousands of jobs worldwide after declining EV sales in the first quarter.

Tesla and CEO Elon Musk have clashed with union proponents for years and were found to have engaged in union busting. In 2021, the NLRB decided that Tesla violated labor laws when it fired a union activist, and when Musk wrote on Twitter in 2018: “Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing?”

An administrative court ordered the CEO to remove the post. Tesla challenged the order but its petition for review was denied. The post in question remains on Musk’s X account, where he has 182.7 million listed followers.

Tesla has also faced workers’ rights challenges in Europe. Last year, Swedish service technicians began a strike that continues today, with the labor group allowing for some authorized work to take place at times. The employees in Sweden, where a majority of the workplace is involved in unions, are seeking a collective bargaining agreement with Tesla.

Tesla didn’t immediately respond to a request for comment.

Read the complaint here:

Tesla reported a 9% drop in first-quarter revenue on Tuesday, the biggest decline since 2012, and missed analysts’ estimates, as the electric vehicle company weathers the effect of ongoing price cuts.

The stock jumped in extended trading after CEO Elon Musk told investors that production of new affordable EV models could begin sooner than expected.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: 45 cents adjusted vs. 51 cents expected
• Revenue: $21.30 billion vs. $22.15 billion expected

Revenue declined from $23.33 billion a year earlier and from $25.17 billion in the fourth quarter. Net income dropped 55% to $1.13 billion, or 34 cents a share, from $2.51 billion, or 73 cents a share, a year ago.

The drop in sales was even steeper than the company’s last decline in 2020, which was due to disrupted production during the Covid-19 pandemic. Tesla’s automotive revenue declined 13% year over year to $17.38 billion in the first three months of 2024.

Musk said on the call that the company plans to start production of new models in “early 2025, if not late this year,” after previously expecting to begin in the second half of 2025. Musk also touted Tesla’s investments in artificial intelligence infrastructure, and said the company is in talks with “one major automaker” to license its driver assistance system, which is marketed in the U.S. as the Full Self-Driving, or FSD, option.

In its shareholder deck, Tesla reiterated a pessimistic outlook for 2024, telling investors that “volume growth rate may be notably lower than the growth rate achieved in 2023.”

Prior to the 11% jump after hours, Tesla shares were down more than 40% this year, reaching their lowest since January 2023, on concerns about weak deliveries, competition in China and the company’s ongoing price cuts. Earlier this month, Tesla reported an 8.5% year-over-year decline in vehicle deliveries for the first quarter.

The company said in the deck that it’s accelerating the launch of “new vehicles, including more affordable models,” that will “be able to be produced on the same manufacturing lines” as Tesla’s current lineup. Tesla is aiming to “fully utilize” its current production capacity and to achieve “more than 50% growth over 2023 production” before investing in new manufacturing lines.

Also in the deck, Tesla showed off screens of a robotaxi-based ride-hailing service. The company has been promising a self-driving vehicle for years without delivering on Musk’s promise.

Sales growth across EVs is slowing, and Tesla and key rivals have been slashing EV prices to try to spur demand. Tesla’s gross profits plummeted 18% in the first quarter, partly due to price cuts this year.

After discussing operational challenges in the first quarter, including Red Sea supply chain disruptions, Musk said on the call that, “We think Q2 will be a lot better.”

Tesla said total sales included revenue from earlier sales of its FSD option. The release of a feature called Autopark in North America allowed the company to recognize the deferred revenue.

Chris Redl, autos analyst at Siena Capital, estimates that Tesla recognized as much as $700 million in deferred revenue in the quarter from FSD. That’s roughly 4.3% of Tesla’s automotive revenue after stripping out regulatory credits.

Tesla embarked on a massive restructuring this month, with two executives, Drew Baglino and Rohan Patel, resigning. Musk said last week in a companywide memo that the automaker was cutting more than 10% of its global workforce.

Capital expenditures rose to $2.77 billion, up 34% from a year earlier.

Free cash flow turned negative in the quarter, with the company reporting a deficit of $2.53 billion. A year ago, Tesla reported free cash flow of $441 million, a number that reached $2.06 billion in the fourth quarter. Tesla attributed the negative figure to a $2.7 billion buildup in inventory and $1 billion in capital expenditures on “AI infrastructure.”

Revenue in Tesla’s energy division increased 7% to $1.64 billion, while services and other revenue rose 25% to $2.29 billion compared to the same period last year.

Musk was asked on the earnings call if he has any intention to leave Tesla given his many jobs, including leading SpaceX, controlling X (formerly Twitter) and running other businesses.

Musk didn’t provide an answer, but said he spends the majority of his time at work, rarely even takes off a Sunday afternoon and will work to make sure Tesla is “very prosperous.”

At the conclusion of the call, Tesla’s Martin Viecha, vice president of investor relations, said that he’s leaving the company in a couple months after seven years. Musk thanked him.

Correction: A prior version of this story had an incorrect figure for automotive sales.

WATCH: The fact that Musk was right about EVs doesn’t mean he’s going to be right now

A car loses value as soon as you drive it off the lot, but electric vehicles are taking this adage to a new level. That’s becoming a major barrier to wider adoption, according to some industry and investment experts. 

A recent study from iSeeCars.com showed the average price of a 1- to 5-year-old used EV in the U.S. fell 31.8% over the past 12 months, equating to a value loss of $14,418. In comparison, the average price for a comparably aged internal combustion engine vehicle fell just 3.6%.

While lower used EV prices could increase their desirability to some buyers, they can also reduce demand for new electric vehicles, according to Karl Brauer, executive analyst at iSeeCars.

“The value a new car loses in the first few years is the single most expensive aspect of owning a new vehicle,” he said, explaining that “as more new car shoppers become aware of the massive drop in EV values they will be less interested in buying one.”

Speaking to CNBC’s “Street Signs Asia” on Monday, David Kuo, stock analyst and co-founder at the Smart Investor, said that the inability of EVs to retain value had kept him from investing in the industry. 

According to Kuo, EVs are analogous to other consumer electronics like laptops and cell phones in that they tend to lose value and relevance quickly after being sold. 

“The same [depreciation] is going to happen to electric vehicles; it’ll probably cost you $20,000, $30,000 to buy one, but in a year’s time it will depreciate much faster than an internal combustion engine car,” he said.  

Industry insiders have also flagged EV resale problems. Speaking to Bloomberg late last year, representatives from VW and Toyota said depreciation was hurting the value proposition of their battery-powered vehicles. 

Kuo further argued that the software and computing capabilities of used EVs may become outdated and incompatible with updates by the time they are sold or even beforehand. That will be a “lightbulb moment” when buyers realize they paid too much in the first place, he added.

Despite EVs’ apparent depreciation issue, its causes might have less to do with the technology itself and more to do with market conditions.  

According to iSeeCars, dramatic drops in used electric vehicle values in the U.S. have largely been driven by aggressive price cuts by Tesla amid a broader price war in the EV market. 

Tesla is the dominant EV seller in the U.S. and as a result of lower prices for its new EVs, buyers are less likely to entertain the same price levels for used alternatives. 

“If [Elon Musk] continues to reduce Tesla prices in an effort to stimulate sales, he’ll continue to pull the entire market down, as he did over the past 15 months,” iSeeCars’ Brauer said.

In an October earnings call, Musk defended the price cuts, emphasizing the importance of cost to consumers.

“It’s not an optional thing for most people; it is a necessary thing. We have to make our cars more affordable so people can buy them,” he said.

In the following quarter’s earnings call in January, chief financial officer Vaibhav Taneja said the company would continue to focus on its cost reduction efforts in 2024.

Since then, the EV price war between Tesla and Chinese competitors has shown little signs of letting up. 

Additionally, overproduction of EVs relative to demand has created excessive supply, making it unlikely for new and used EV prices to rebound in the near term, according to Brauer.

What is an ongoing issue for the EV market, however, may be a boon for electric and combustion powered hybrids, which are showing increasing strength in new and used vehicle markets. 

The average price for used hybrid vehicles fell only 6.5% or $2,135 last year — a fraction of the decline of the average EV. 

“Hybrids are an excellent stepping stone between gasoline and electric cars, and I expect to see them increasing in popularity over the next 10 years,” Brauer said. 

Norway boasts the highest electric vehicle adoption rate in the world. Some 82% of new car sales were EVs in Norway in 2023, according to the Norwegian Road Federation (OFV). In comparison, 7.6% of new car sales were electric in the U.S. last year, according to Kelley Blue Book estimates. In the world’s largest auto market, China, 24% of new car sales were EVs in 2023, according to the China Passenger Car Association.

 “Our goal is that all new cars by 2025 will be zero-emission vehicles,” said Ragnhild Syrstad, the state secretary of the Norwegian Ministry of Climate and Environment, “We think we’re going to reach that goal.”

The Norwegian government started incentivizing the purchase of EVs back in the 1990s with free parking, the use of bus lanes, no tolls and most importantly, no taxes on zero-emission vehicles. But it wasn’t until Tesla and other EV models became available about 10 years ago that sales started to take off, Syrstad said.

Norway’s capital, Oslo, is also electrifying its ferries, buses, semi trucks and even construction equipment. Gas pumps and parking meters are being replaced by chargers. It’s an electric utopia of the future. Norway’s grid has been able to handle the influx of EVs so far because of its abundance of hydropower.

“Electric cars are maybe a third of the price of gasoline because we have close to 100% hydropower. It’s cheap. It’s available and renewable. So that’s a big advantage,” said Petter Haugneland, the assistant secretary general of the Norwegian EV Association.

CNBC flew across the globe to meet with experts, government officials and locals to find out how the Scandinavian country pulled off such a high EV adoption rate.

Watch the documentary for the full story. 

Tesla and SpaceX CEO Elon Musk has to testify in a probe by the U.S. Securities and Exchange Commission concerning his 2022 acquisition of Twitter, a federal judge ordered Saturday.

As CNBC previously reported, the SEC is investigating whether Musk or anyone else committed securities fraud in 2022 as the billionaire began buying stock in Twitter and building a stake ahead of his leveraged buyout of the social media company.

Musk closed his acquisition of Twitter in October 2022 in a deal worth roughly $44 billion and has since rebranded it X.

In the order dated Feb. 10, 2024, federal magistrate judge Laurel Beeler wrote that although Musk and his legal team argued the SEC’s subpoena in this matter amounted to harassment of the billionaire, the federal financial regulator was “within its authority” and its subpoena was “definite, and seeks relevant information” to its investigation.

The federal financial regulator and Musk now have one week to set a date and location for his testimony.

Musk and his attorney Alex Spiro didn’t immediately respond to requests for comment. A spokesperson for the SEC declined to comment “beyond the public filings for this matter.”

Musk has repeatedly sought to challenge if not strip authority from federal regulatory agencies.

For example, he has asked the U.S. Supreme Court to undo a settlement agreement that he and Tesla struck with the SEC previously. The settlement required Musk to have a “Twitter sitter” approve his tweets about his electric vehicle business before he posts them. Musk’s attorneys have argued that the agreement set an unconstitutional condition on Musk and amounts to a violation of his free speech rights.

In another example, Musk-led defense contractor SpaceX sued the National Labor Relations Board after the federal agency filed a complaint against the company alleging the rocket maker illegally fired employees who signed an open letter critical of Musk. The letter said, among other things, that Musk’s “behavior in the public sphere is a frequent source of distraction and embarrassment for us.” 

SpaceX filed its lawsuit against the NLRB in the U.S. District Court for the Southern District of Texas in Brownsville. Attorneys for SpaceX argued in their suit that the very structure of the federal labor board violates the U.S. Constitution. Their suit resembles one brought by a former employee of Starbucks against the NLRB, and seeks to prevent the NLRB’s earlier complaint against SpaceX from moving forward.

Read the full order to compel compliance here.

Tesla is rolling out “market adjustment” pay increases this month to many of its factory workers across the U.S., according to notices posted at the company’s vehicle assembly plant in Fremont, California.

Bloomberg first reported on the posters.

An employee in Fremont confirmed that the 2024 pay rate information was distributed at the site, and that increases were recently implemented by the company. The person asked not to be named, citing a lack of permission to speak with the media.

CNBC reported last month that Tesla workers at the company’s battery plant in Sparks, Nevada learned their hourly rates would be going up in January. The hikes for hourly workers in Nevada represented about 10% increases, depending on position and not including bonuses that some employees would be able to earn.

The fresh pay increases follow an announcement by the United Auto Workers that it would aim to organize at least one Tesla plant after major wins at the big three Detroit automakers. The UAW is circulating an authorization card online, and is gathering names and signatures of Tesla workers to gauge their interest in forming a union.

Under Shawn Fain’s leadership, the UAW seeks recognition of the union by the company or a vote when it secures about 70% of workers at a factory.

“Tesla is now following in the footsteps of Toyota, Hyundai, Volkswagen, and almost every other car company in raising wages in the wake of our historic victory at the Big Three, as non-union autoworkers everywhere are starting to stand up for themselves,” Fain said in a statement emailed to CNBC by a spokesperson. “As great as these raises are, they still fall far short of what the companies can afford and what autoworkers are worth.”

The union didn’t say how many Tesla workers have signed the authorization card so far.

Tesla’s director of people operations and programs didn’t immediately respond to a request for comment.

Tesla CEO Elon Musk has long clashed with unions. At the 2023 New York Times DealBook Summit in November, he said “I disagree with the idea of unions,” and claimed they create, “a lords and peasants sort of thing.”

The National Labor Relations Board has found that Tesla violated federal labor laws on more than one occasion. In 2018, for example, Musk tweeted that workers at the Tesla plant in Fremont would lose stock options if they unionized. A federal appeals court ruled that his tweet amounted to an unlawful threat.

President Joe Biden previously said he supported efforts to organize workers at plants that didn’t yet recognize unions. That group includes Tesla and Toyota.

Tesla has faced challenges with unions in Europe as well, including strikes and boycotts last year involving service workers.

The New York Times reported that at least 15 unions have joined IF Metall in strikes to “try to force Tesla to negotiate a collective bargaining agreement to set wages and benefits that reflect industrywide norms in Sweden.” The Associated Press reported that large pension funds in Scandinavia have asked Tesla to reconsider its approach to working with unions and collective agreements.

Tesla shares closed down 2.9% on Thursday following reports of the U.S. pay increases, and news that the automaker would suspend production for two weeks in Germany due to supply chain problems pertaining to attacks in the Red Sea.

WATCH: Tesla is ‘egregiously’ overvalued

When Gerard de Graaf moved from Europe to San Francisco almost a year ago, his job had a very different feel to it.

De Graaf, a 30-year veteran of the European Commission, was tasked with resurrecting the EU office in the Bay Area. His title is senior envoy for digital to the U.S., and since September his main job has been to help the tech industry prepare for new legislation called The Digital Services Act (DSA), which goes into effect Friday.

At the time of his arrival, the metaverse trumped artificial intelligence as the talk of the town, tech giants and emerging startups were cutting thousands of jobs, and the Nasdaq was headed for its worst year since the financial crisis in 2008.

Within de Graaf’s purview, companies including Meta, Google, Apple and Amazon have had since April to get ready for the DSA, which takes inspiration from banking regulations. They face fines of as much as 6% of annual revenue if they fail to comply with the act, which was introduced in 2020 by the EC (the executive arm of the EU) to reduce the spread of illegal content online and provide more accountability.

Coming in as an envoy, de Graaf has seen more action than he expected. In March, there was the sudden implosion of the iconic Silicon Valley Bank, the second-largest bank failure in U.S. history. At the same time, OpenAI’s ChatGPT service, launched late last year, was setting off an arms race in generative AI, with tech money pouring into new chatbots and the large language models (LLMs) powering them.

It was a “strange year in many, many ways,” de Graaf said, from his office, which is co-located with the Irish Consulate on the 23rd floor of a building in downtown San Francisco. The European Union hasn’t had a formal presence in Silicon Valley since the 1990s.

De Graaf spent much of his time meeting with top executives, policy teams and technologists at the major tech companies to discuss regulations, the impact of generative AI and competition. Although regulations are enforced by the EC in Brussels, the new outpost has been a useful way to foster a better relationship between the U.S. tech sector and the EU, de Graaf said.

“I think there’s been a conversation that we needed to have that did not really take place,” said de Graaf. With a hint of sarcasm, de Graaf said that somebody with “infinite wisdom” decided the EU should step back from the region during the internet boom, right “when Silicon Valley was taking off and going from strength to strength.”

The thinking at the time within the tech industry, he said, was that the internet is a “different technology that moves very fast” and that “policymakers don’t understand it and can’t regulate it.”

However, some major leaders in tech have shown signs that they’re taking the DSA seriously, de Graaf said. He noted that Meta CEO Mark Zuckerberg met with Thierry Breton, the EU commissioner for internal market, to go over some of the specifics of the rules, and that X owner Elon Musk has publicly supported the DSA after meeting with Breton.

De Graaf said he’s seeing “a bit more respect and understanding for the European Union’s position, and I think that has accelerated after generative AI.”

X, formerly known as Twitter, had withdrawn from the EU’s voluntary guidelines for countering disinformation. There was no penalty for not participating, but X must now comply with the DSA, and Breton said after his meeting with Musk that “fighting disinformation will be a legal obligation.”

“I think, in general, we’ve seen a serious commitment of big companies also in Europe and around the world to be prepared and to prepare themselves,” de Graaf said.

The new rules require platforms with at least 45 million monthly active users in the EU to provide risk assessment and mitigation plans. They also must allow for certain researchers to have inspection access to their services for harms and provide more transparency to users about their recommendation systems, even allowing people to tweak their settings.

Timing could be a challenge. As part of their cost-cutting measures implemented early this year, many companies laid off members of their trust and safety teams.

The rise and rapid spread of generative AI has led to a number of big tech companies and high-profile executives calling for regulations, citing the technology’s potential influence on society and the economy. In June, the European Parliament cleared a major step in passing the EU AI Act, which would represent the EU’s package of AI regulations. It’s still a long way from becoming law.