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Home ยป Canaccord Genuity Analyst note: Tesla is increasingly a Bet on Autonomy

Canaccord Genuity Analyst note: Tesla is increasingly a Bet on Autonomy

Tesla's Robotaxi Project

The road to a self-driving future has been long and winding, filled with ambitious promises and missed targets. But if there’s one thing Elon Musk excels at, it’s doubling down on his big bets. Elon putting all his chips on autonomous driving tech being the key that unlocks the door to the next era of transportation.

On August 8th, Tesla plans to pull back the curtain on its much-hyped Robotaxi at a special unveil event. What exactly will be revealed remains a mystery.

The big unveil comes as analysts grow increasingly convinced that Tesla’s future success rides on cracking autonomous driving. In a recent investor note, Canaccord’s George Gianarikas laid it out bluntly: “Tesla is increasingly a bet on autonomy car.”

George Gianarikas is about as bullish as they come on the world of robo-rides, calling Robotaxi “one of the highest value-creating technologies to be deployed. Ever.” He envisions a future where self-driving cars increase productivity, save lives, and basically solve all our traffic woes. “We’re autonomy uber-bulls,” he proclaims.

But despite Tesla’s big head start, Gianarikas admits there’s still a wide-open race to determine whose autonomous tech will reign supreme. Tesla’s controversial camera-only approach is a “different, controversial technology,” competing against systems from Mobileye, and others melding machine learning with more traditional coding.

The Future Is Robo?

Where analysts seem to agree is that vertical integration – controlling the full hardware and software stack – will be key. That gives Tesla a big leg up if it can crack the code, using its autonomous smarts exclusively in its own vehicles.

For now though, Gianarikas sees Tesla and Mobileye as the leaders in cracking passenger self-driving, with Aurora poised to dominate self-driving trucks. But he’s clear that “tons of questions remain” about which approach will ultimately reign supreme.

What’s undeniable is the massive potential payoff if Tesla can deliver on its autonomous driving promises. Gianarikas envisions the “razor/razorblade” business model finally taking off, with self-driving as the high-margin service layered atop Tesla’s vehicle sales.

That’s a fundamental shift from Tesla’s current model of just selling pricey EVs. But it could finally make those long-promised profit gushers a reality by powering “a true breakthrough in margins above historical levels.”

For Tesla’s part, the company insists plans for next-gen $25k vehicles haven’t been scrapped despite reports. Whether they’ve simply been accelerated or remain nebulous, one thing is clear – autonomy is the future Musk is betting big on.

“It could be that the company has accelerated the development of its full Robotaxi based on confidence in FSD,” speculates Gianarikas about Tesla’s pivot to the 8/8 unveiling.

With slowing sales and rising competition, Musk may feel sharing the autonomous driving roadmap is his best move. After all, low-cost Chinese EVs are starting to put the squeeze on Tesla, which may need to lean harder into self-driving as a key differentiator.

Or as Gianarikas sums it up: “Tesla is increasingly a bet on autonomy.” On 8/8, we’ll get our biggest peek yet at just how heavily Musk is going all-in on making that bet pay off bigly.

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