Morgan Stanley analyst Andrew Percoco believes that Tesla’s launch of its Robotaxi service in Houston and Dallas represents a significant step forward for the automaker’s self-driving vision. This development comes at a time when the market was growing increasingly skeptical about Tesla’s robotaxi expansion timeline.
Tangible Progress
In a recent investor note, Percoco stated that the rollout is a “material evolution” from Austin’s launch last year, which initially used human safety drivers for several months before becoming unsupervised. He believes that a successful robotaxi rollout has the potential to create a powerful flywheel across Tesla’s ecosystem, expediting the development of unsupervised Full Self-Driving (FSD) technology.
Percoco also commented on Tesla’s capex figures, stating that advancements in FSD are “a key lever to re-invigorate auto sales and margins to fund Tesla’s longer-term ambitions in physical AI.” Despite this, he did not change his price target of $415 for the automaker.
Ross Gerber Weighs In
Investor Ross Gerber of Gerber Kawasaki has expressed skepticism about the service’s rollout, suggesting that Tesla is trying to distract from its upcoming earnings report. Gerber believes that the automaker is “kicking the can down the road” without providing further expansion on its plans.
Tesla’s AI5 Chip
Elon Musk recently showcased Tesla’s AI5 chip, a crucial element of the automaker’s self-driving plans. The company has also released FSD v14.3, promising improvements to the self-driving suite. However, Gerber has stated that customers deserve a $10,000 refund if the v14.3 update does not enable Unsupervised FSD.
Tesla’s Lawsuit Woes
Tesla is currently facing over 21 active lawsuits, including wrongful death lawsuits and customer complaints about its self-driving and driver assistance systems. These legal troubles could reportedly cost the company billions of dollars in settlements and other costs.
Price Action
Tesla’s stock surged 3.01% to $400.62 at market close on Friday, climbing 0.12% further to $401.09 during the after-hours trading session.
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For more information on Tesla and the future of mobility, check out our Future Of Mobility coverage.
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