Assessing The Threat Waymo And Lyft Pose To Tesla

The race toward building a fully functioning large-scale fleet of autonomous vehicles intensified this week after Lyft struck a new partnership with Alphabet Inc GOOG GOOGL's Waymo unit.

The question on many investors' minds after the announcement is what impact, if any, this will have on Tesla Inc TSLA, which is also vying for a leadership position in the autonomous driving space.

Morgan Stanley Speaks Out Post-Downgrade

Adam Jonas, an analyst with Morgan Stanley, downgraded Tesla's stock on Monday. He commented in a research report on Wednesday that the combination of Waymo and Lyft is a "complementary fit," which combines Waymo's technological expertise with Lyft's fleet that can log several million vehicle miles per day.

Jonas went on to highlight one of the themes of his recent downgrade, namely the ability of large tech firms to enter the automated transport market. This is exactly what happened between Alphabet's unit and Waymo and further makes the case that large tech companies don't want to be in the business of a self-driving car, rather want a user's attention inside of a self-driving car.

"Firms could enter the market as a competitor, offering the mobility service from, say, New York to Boston or from Santa Monica to LAX at a loss [...] just to get access to your time and data [...] the chance to monetize your journey for paid search or to sell you content," the analyst explained.