- Tesla is making its foray into the restaurant business, opening its first Tesla Diner on Monday. The concept is serving french fries and burgers, but also features charging stations, movie screens, and Optimus robots. As the EV maker continues to limp, Wedbush analyst Dan Ives said the diner is a way for Tesla to revive its battered brand.
A tuna melt served in a cardboard Cybertruck box is just all part of Tesla’s recovery plan.
The EV maker has ventured into the hospitality industry, opening the first Tesla Diner in Los Angeles on Monday. The retro-futuristic restaurant, complete with movie screens and 80 Tesla charging stations, will also serve up diner classics, from $12 “epic bacon” to $4 tallow-fried french fries to $13 hot dogs.
The restaurant has enlisted the help of Tesla’s Optimus robots to serve popcorn to patrons. The Tesla Diner also sells a line of merchandise. Early reviews on social media have praised the food, despite waiting an hour and a half in line for apple pie and hash browns.
CEO Elon Musk has already eyed expansion for the open-24/7 concept, which he called an “island of good food, good vibes & entertainment.”
“If our retro-futuristic diner turns out well, which I think it will, @Tesla will establish these in major cities around the world, as well as at Supercharger sites on long distance routes,” Musk wrote on social media.
As other brands jump on the nostalgia-based dining concept—Cheez-It last year opened a Woodstock, New York, diner with Cheez-It milkshakes on the menu—Tesla’s foray into the restaurant business is an opportunity to build hype for a brand that’s taken a beating, according to Tesla bull and Wedbush Securities managing director Dan Ives.
“It’s all about brand, and that’s everything that Musk is building in his next phase,” Ives told Fortune. “It fits very well with what they’re trying to do: They’re trying to lay out an all-encompassing brand that eventually goes from the car to the house to a restaurant to other areas of AI.”
Tesla continues to struggle in California, where sales have declined for seven straight quarters, including an 18.3% crater in registrations in the state year-to-date. After launching its robotaxi pilot in Austin last month, Tesla has stoked concern for the product’s growth as the service has not yet scaled and has been subject to safety concerns following a near-accident. Musk has rested the fate of the company on the highly anticipated robotaxi, which has not yet created the returns needed to expand the company’s production of its Optimus robot.
The restaurant concept, according to Ives, is “Musk building out the next leg of the Tesla growth story.” With a “cult-like following,” Tesla—a company that does not invest in advertising—can begin to incrementally attract customers.
Tesla did not respond to Fortune’s request for comment.
Elon Musk: ‘War-time CEO‘
Musk’s renewed focus on Tesla’s brand is what Ives had hoped for after months of pleading for the CEO to distance himself from President Donald Trump, for whom he served as “First Buddy” and ringleader of the Department of Government Efficiency (DOGE) tasked with uprooting bureaucracy and culling billions of dollars in federal spending.
But Musk’s controversial role in the Trump administration alienated his eco-conscious customer base, stoking protests against Tesla and drawing ire from investors worried the CEO was taking his attention away from his flailing company. All said, in Musk’s 130-day stint as a special government employee that ended in May, he lost and gained $100 billion of his net worth, ultimately ending his tenure with $27 billion less in wealth than he had before Trump’s inauguration.
In March, following Tesla recording its worst single-day sell off, losing $127 billion in market value, Ives called Musk’s proximity to the Trump administration a “brand tornado crisis moment” for Tesla. Now, Ives said the brand damage to Tesla is “contained,” albeit still here.
“Musk is now more of a wartime CEO,” Ives said. “And it’s about looking forward, not behind.”
Earlier this month, Ives outlined in a note to investors how Tesla’s board can help Musk right the ship. He suggested creating an incentive-driven pay package that would give Musk a bigger stake in the company and more voting power in order to keep Musk focused, particularly on a framework to merge Tesla with xAI—a move Musk opposes. Ives also indicated the board should limit Musk’s political pursuits by setting up a committee to oversee his political ambitions, including donations.
“Tesla is heading into one of the most important stages of its growth cycle with the autonomous and robotics future now on the doorstep and cannot have Musk spending more and more time creating a political party, which will require countless time, energy, and political capital,” Ives wrote.
