Tesla hits another speed bump with a big rejection for the Robotaxi and Cybercab, while plant employees want Elon Musk to resign

While its share price is off the mat courtesy of easing trade tensions between the US and China, demand for Tesla cars is still flat with the brand taking a backwards step in global sales in 2024 and an even bigger year-on-year drop in the first quarter of this year.

And on the back of increasing calls, including from company employees, for Tesla’s increasingly high-profile CEO Elon Musk to resign, the last thing the business needs is complications in launching its next marquee product.

But that’s exactly what’s happened with the United States Patent and Trademark Office (USPTO) rejecting Tesla’s application to trademark the term ‘Robotaxi’ for its vehicles and pausing its bid for the name ‘Cybercab’ just as the EV giant is preparing to launch its business-critical autonomous ride-hailing service.

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While conceding there are currently no conflicting trademarks, the USPTO has determined Robotaxi is too generic, positioning it as “merely descriptive” adding the term is already “used to describe similar goods and services by other companies”.

If Tesla doesn’t respond with an updated pitch for Robotaxi within a three-month period the USPTO will abandon the application.

The Cybercab application has been halted because other companies are petitioning for ownership of the same term.

It’s worth noting in late 2024 Tesla also applied for exclusive use of the term ‘Robobus’ which is still under consideration with the USPTO.

At the same time Tesla has applied to trademark Robotaxi in the context of transportation services rather than a specific vehicle but no decision has been forthcoming on it so far.

This red tape stumbling block comes on top of Tesla US employee unrest in the form of a group called ‘Tesla Employees Against Elon’, calling for the CEO to step aside.

Tesla is famously the only carmaker in the USA whose workforce is not represented by a union but it appears spontaneous action by many on the shop floor has overtaken that stance.

On its website, the anti-Musk group has published an open letter stating in part that, “Tesla is at a pivotal moment. The damage done to Elon’s personal brand is now irreversible and as the public face of Tesla, that damage has become our burden. 

“We are now at a crossroads: continue with Elon as CEO and face further decline as customers abandon the brand, or move forward without him and allow our products and mission to succeed or fail on their own.

“Elon’s recent claim that he is “refocusing” on Tesla is not only tone-deaf, it’s insulting. It implies that the hardships of the past six months stem from a lack of his attention, not from his actions. It shifts the blame onto the very people who have held this company together.

"Let’s be clear: we are not the problem. Our products are not the problem. Our engineering, service, and delivery teams are not the problem. The problem is demand. The problem is Elon,” the letter said.