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Nov. 30, 2024, 8:16 a.m.
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Tesla's Path to $2 Trillion Valuation Driven by AI and Autonomous Innovations

Brief news summary

Wedbush analyst Dan Ives forecasts Tesla's market valuation could hit $2 trillion in the next 12 to 18 months, fueled by AI innovations, autonomous driving advancements, and the new Cybercab. Tesla's growth hinges on breakthroughs in self-driving technology, potentially influenced by regulatory shifts that Elon Musk might inspire. Ives sees potential benefits from a collaboration with a Trump-led administration, which could ease regulatory barriers and bolster Tesla's autonomous vehicles and Musk's AI goals. Ives suggests that the Transportation Department should establish a self-driving vehicle framework and appoint an AI Czar to promote AI initiatives. He estimates Tesla's AI and autonomous technologies to be worth about $1 trillion, with a Trump administration's deregulatory stance potentially accelerating progress. Deregulation under Trump might bolster Tesla's competitive position, especially against China's AI and autonomous advancements. Removing the $7,500 federal EV tax credit could benefit Tesla, as it can thrive without subsidies. Wedbush maintains a $400 target price and an Outperform rating for Tesla, highlighting its strong long-term growth potential and expertise in AI.

In This Article: Tesla (TSLA, Financials) could achieve a $2 trillion valuation in the next 12 to 18 months, according to a report by Wedbush analyst Dan Ives. Key growth drivers are anticipated from developments in artificial intelligence, autonomous driving, and the introduction of the Cybercab. Ives highlights Tesla's dedication to full self-driving technologies and the influence of CEO Elon Musk on shaping federal regulations. Potential collaboration with the Trump administration could accelerate projects for driverless cars by relaxing rules, bolstering Musk's goals in artificial intelligence. Ives suggested that the Transportation Department prioritize establishing a framework for self-driving cars. He also noted that creating an AI Czar position would foster broader AI initiatives, valuing Tesla's AI and autonomous technology at $1 trillion alone. "We fully expect under a Trump White House, those initiatives will now get fast-tracked as the federal regulatory web that Musk & Co have encountered over the past few years clears significantly, " Ives stated. Regulatory hurdles impeding Tesla's progress might ease under a potential Trump presidency, paving the way for expansion.

Ives believes this environment could accelerate Tesla's goals for 2026-2027, enabling it to compete with China's AI and autonomous vehicle advancements. The elimination of the $7, 500 federal EV tax credit could enhance Tesla's competitive edge in the electric car market. Ives remarked on Tesla's size and market dominance solidifying its position in a non-subsidy environment. With a $400 price target, Wedbush maintains an Outperform rating on Tesla, emphasizing investor focus on the company's long-term growth strategy and AI potential. This article first appeared on GuruFocus. Recommended Stories


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