Tesla's robotaxi vision is no longer just a promise—it's finally rolling, cautiously, through the streets of Austin. This week, the company began offering paid rides in a handful of modified Model Ys under a limited pilot program. The service is geofenced, invite-only, and each vehicle still includes a safety driver. Still, for Tesla (TSLA, Financial), this is a pivotal moment. Autonomous driving now accounts for a massive chunk of the stock's valuation. RBC Capital pegs nearly 59% of its price target—$181 per share—on robotaxis alone, with another $53 tied to monetizing Full Self Driving. That's over $800 billion in implied value based on long-term revenue models, not current profitability.
But Tesla's launch has opened the door to some uncomfortable questions. While the company has long claimed all its vehicles are robotaxi-ready, Business Insider reports suggest otherwise. According to unnamed sources, Tesla is building specially modified Model Ys for the Austin launch—complete with additional telecom systems and reinforced cameras. Meanwhile, Ashok Elluswamy, head of Autopilot engineering, recently mentioned the use of new audio sensors. These details raise doubts about whether Tesla's existing fleet can be flipped into a national robotaxi network as easily—or cheaply—as advertised. The strategy also now mirrors the one Tesla once mocked: a cautious, city-by-city rollout, much like Waymo's. Notably, Waymo already provides over 250,000 weekly rides and recently announced a tentative partnership with Toyota.
The bigger challenge for Tesla? The clock just started ticking. After years of deferrals, the market now expects execution. Tesla's core EV business has hit a wall—falling sales, a lukewarm Cybertruck launch, and no sign of the long-promised affordable model. Since Elon Musk shifted focus to AI, robotaxis, and humanoid robots in early 2024, Tesla's forward multiple has more than doubled to around 140x. But lofty multiples built on future hopes require traction—fast. Goldman Sachs recently modeled a wide range of outcomes for Tesla's robotaxi program by 2040, with share value scenarios swinging from as low as $2.50 to as high as $81.75. For now, investors are betting big. But turning vision into reality is no longer optional.
