Ark Invest analyst Tasha Keeney said on Monday that EV giant Tesla Inc. TSLA holds a key advantage over autonomous vehicle operators like Alphabet Inc.’s Waymo in deploying and scaling robotaxi operations owing to the company’s car manufacturing capabilities.
What Happened: While Waymo is “slowly but surely” scaling its service across regions, it is still plagued by longer wait times owing to its small fleet and other technical issues, Keeney wrote on X on Monday, reflecting upon her ride in a Waymo car in Los Angeles.
Tesla could take less time to scale its robotaxi network once it launches than rivals, Keeney said, owing to the company’s vertically integrated approach. With the participation of customers, Tesla can expand its robotaxi network with ease through its existing fleet, she added.
Further, Tesla’s cheapest EV – the Model 3 – starts at just $40,000, Keeney noted, as opposed to Waymo vehicles which are rumored to start over $100,000.
“While Waymo's true costs could be lower, and the gen 6 platform is likely some improvement on current costs, given the sensor suite integration costs alone, a wholly owned automotive manufacturing business is likely a key advantage,” Keeney said.
While high vehicle costs could impact capital investment and initial profitability, a high utilization rate will likely bring down cost per mile in the long term, the analyst opined.
Musk Reacts: “If Elon's predictions hold true, we might soon have the chance to compare these services directly—he has high confidence Tesla could deliver a fully driverless experience by the end of next year,” Keeney concluded on Monday.
Tesla CEO Elon Musk responded to the analyst and wrote, “The trend is promising.” The CEO was possibly referring to the rate of adoption of autonomous vehicles.
Why It Matters: Tesla is currently laser-focused on vehicle autonomy and is attempting to improve its full self-driving (FSD) driver assistance software to enable vehicles to operate without human intervention. However, it presently requires active driver supervision.
The company is also expected to unveil its dedicated robotaxi product on October 10.
Musk remains optimistic that Tesla will eventually achieve true autonomy, comparing self-driving cars to elevators that transport passengers to their destinations.
“Even if I got kidnapped by aliens tomorrow, Tesla will solve autonomy, maybe a little slower, but it would solve autonomy for vehicles at least,” Musk said during Tesla's first-quarter earnings call. “If somebody doesn’t believe Tesla is going to solve autonomy, I think they should not be an investor in the company.”
Musk reiterated the sentiment last month.
Waymo, meanwhile, introduced its sixth-generation hardware including a new sensor suite on Monday to reduce costs while simultaneously delivering more performance, including in winter. Its parent Alphabet committed to a new multiyear investment of $5 billion into Waymo to help the company last month.
The company now operates its autonomous vehicles in multiple cities including San Francisco and is also looking to scale operations to other cities including Austin.
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