Tesla Inc. (TSLA) is gearing up to host its much-anticipated Robotaxi event on October 10th, and investors are on edge about the potential implications for the company’s autonomous ride-sharing aspirations. According to Morgan Stanley analyst Adam Jonas, who has an Overweight rating and a $310 price target for Tesla shares, the event could be a game-changer.
Jonas believes that Tesla will unveil a cybercab demonstration on a closed course, offering attendees a glimpse into the future of autonomous ride-hailing. The analyst expects Tesla to announce a potential commercial launch date, likely sometime in late 2025 or 2026. The company is expected to adopt a dual approach to autonomous ridesharing – a fully app-based “cybercab” and a supervised autonomous/FSD (Full Self-Driving) ride-share service.
While both approaches are exciting, the supervised FSD ride-share service is the one that could truly surprise investors in the near term. Jonas’s model predicts that the majority of rides and miles traveled through 2030 and beyond will be based on this approach. In this scenario, vehicles are owned by individual drivers or third-party fleets, creating a more accessible and potentially more profitable model.
Based on these expectations, Jonas anticipates that Tesla will reveal key information about their plans, including:
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Target Metro Areas:
Tesla will likely highlight specific urban areas with a high density of Tesla owners where they plan to initially launch their ride-sharing services.*
FSD Hardware Installation:
Tesla will likely share data about the number of vehicles equipped with FSD Hardware 3 and Hardware 4 in different metropolitan areas and regions. Jonas estimates that around 3 million Tesla vehicles will be on the road with FSD by the end of the year.*
FSD Price Cut:
There’s a strong possibility that Tesla might offer a discounted price for the latest version of FSD (v12.5.5) to Tesla drivers participating in ride-sharing services on the Tesla app. This could incentivize drivers to join the platform and boost adoption.*
Driver Economics:
Tesla is expected to present a more attractive take rate for Tesla ride-share drivers compared to the 30% Uber Technologies Inc. (UBER) charges its drivers. Jonas even predicts that Tesla could offer a 0% take rate for the first month as an initial incentive to attract drivers. This move would put more money in the pockets of drivers and help Tesla grow its driver community, especially in a supply-limited market. Jonas estimates that there are currently about 50,000 Tesla vehicles operating on the Uber platform.The Robotaxi event is crucial for Tesla, as it signals the company’s commitment to expanding its business beyond vehicle manufacturing and into the rapidly evolving realm of autonomous ride-sharing. Investors will be watching closely to see how Tesla plans to navigate this competitive landscape and achieve its ambitious goals.
