Tesla's flying Roadster: analysts see limited commercial value

Elon Musk, CEO of electric carmaker Tesla and co-founder of space company SpaceX, on Friday showed a Roadster sports car fitted with cold-gas thrusters developed using SpaceX technology. Tesla's share price rose after the demonstration, but analysts say the model has limited commercial value and mainly serves to attract attention.

Analysts' views

Mamta Valechha, consumer discretionary analyst at asset manager Quilter Cheviot, called the display a headline-grabbing engineering moment meant to build excitement around the brand. Rico Luman, senior transport and logistics economist at ING, described it as a publicity stunt that reinforces Tesla's image as an innovator. Gene Munster, managing partner at investment firm Deepwater Asset Management, called it an engineering demonstration with no commercial value. Valechha noted that Musk himself had earlier played down the Roadster's likely financial impact.

Musk said production is expected to begin in 2028. Tesla has opened reservations, although the flying Rocket version is available by invitation only. Final prices have not been announced. The Roadster was first unveiled in 2017, with production originally promised for 2020.

Regulatory hurdles

The Roadster's flying features are not approved for use on public roads. Luman said large-scale flying car use is unrealistic in the foreseeable future because the same airspace rules apply as for aircraft, and in Europe certification by the European Union Aviation Safety Agency (EASA) would be required. EASA said whether the Roadster falls under aviation rules depends on its design, capabilities and intended operation, but any vehicle meant to operate as an aircraft must meet applicable safety requirements, which could include pilot qualifications.

Pressure on profits

Tesla's second-quarter revenue rose 26% year on year to $28.24bn, while net profit attributable to shareholders fell about 5% to $1.11bn. First-half capital spending more than doubled to $8.28bn, and the company expects more than $25bn in 2026. Shares traded at $438 at the start of the year and at above $362 on Thursday, a 14.6% fall.

The technology borrowed from SpaceX has fuelled speculation about a future merger of the two companies. Barclays analyst Dan Levy has suggested an announcement could come before Tesla's annual shareholder meeting, but a deal remains speculative.