Morgan Stanley raises Tesla's target to $415: The Robotaxi landscape continues to expand, and the Model YL's launch in the U.S. opens new growth opportunities

According to the Zhitong Finance APP, Morgan Stanley recently released a research report commenting on two major events for Tesla (TSLA.US): the launch of Robotaxi (autonomous ride-hailing) service in Miami and the introduction of the long-wheelbase, three-row, six-seat version of Model Y (Model YL) in the United States. Meanwhile, the firm has given Tesla a "hold" rating with a target price of $415, which represents about a 3% upside from Tesla's closing price on Tuesday.

Tesla officially launched its Robotaxi service (including unmanned vehicles) in Miami on July 3 local time. In the Q1 fiscal year 2026 earnings presentation materials, Miami was listed as one of the "cities in preparation" along with Phoenix, Orlando, Tampa, and Las Vegas.

Morgan Stanley expects Tesla to launch Robotaxi services in all of the aforementioned metropolitan areas by the end of this year. Additionally, there have been sightings of suspected Robotaxi test vehicles in New Orleans recently (not yet confirmed by Tesla), although this city was not included in the list of cities in preparation from the previous quarter's earnings report.

Morgan Stanley believes that the news is likely to be welcomed by the market, especially after the Robotaxi Tracker data showed a decline in the number of active vehicles in the Robotaxi fleet since the end of April (although this data has not been confirmed by Tesla), as the market had previously thought that the pace of Robotaxi promotion was slowing down.

Last month, Morgan Stanley pointed out that its Alphawise data indicated that the North Austin metropolitan area is increasing recruitment for AI safety operators, suggesting that Tesla is preparing to expand the scale of Robotaxi operations. Meanwhile, the usage of FSD (Full Self-Driving) continues to accelerate, with a cumulative mileage reaching 10 billion miles as of early May.

Morgan Stanley has also established a set of standardized tracking metrics for the Austin Robotaxi fleet based on data from the National Highway Traffic Safety Administration (NHTSA). The data shows a significant improvement in the average mileage per accident since the launch of Robotaxi. Given the widespread controversy in the market regarding Tesla's autonomous driving roadmap, investors are currently closely monitoring the pace of monthly safety data improvements.

Morgan Stanley believes that whether Tesla can continuously improve the accident rate (i.e., the average mileage between accidents continues to increase) while expanding the Robotaxi fleet will be the most critical indicator for investors to assess the success of its Robotaxi business. The firm expects that by the end of this year, Tesla's Robotaxi fleet (including both supervised and unmanned vehicles) will reach 1,500 vehicles and expand to 30,000 vehicles by 2030. Although the absolute number of Robotaxis this year will still have a limited contribution to profits, changes in the pace of Robotaxi promotion will provide clearer judgment criteria for those investors who still question whether Tesla's autonomous driving technology can achieve large-scale commercialization In addition to the promotion progress of the Robotaxi service, Tesla announced last week that it will launch a larger Model YL in the United States, with deliveries planned to start in October. The starting price is $61,990, which includes: one year of FSD service; one year of supercharging service; one year of premium connectivity service; and free choice of all body colors.

The launch of the Model YL in the U.S. market follows its successful debut in the Chinese market. This six-seat long-wheelbase SUV was first released in China last year, priced about $4,000 higher than the standard Model Y. In comparison, the U.S. version of the Model YL is approximately $12,000 more expensive than the Model Y Premium AWD version and about $22,000 more than the Model Y rear-wheel drive version.

Morgan Stanley stated that the strong initial demand for the Model YL after its launch in China demonstrates a high consumer demand for more spacious three-row Tesla models, which is likely to be a significant reason for Tesla to push this model into the global market. U.S. customers are expected to start taking delivery in October this year, so the model will contribute more significantly to sales in the fourth quarter of 2026 and into 2027. In the long term, the Model YL expands Tesla's serviceable market by targeting large family users, while partially filling the market gap left by the discontinuation of the Model X, helping to improve the product mix and average selling price (ASP), and supporting the demand for the Model Y in major markets.

Morgan Stanley has set a target price of $415 for Tesla. The firm explained that this target price is composed of the following five parts: 1) core automotive business: $45/share. 2) network services: $144/share. 3) Robotaxi ride-hailing business: $125/share. 4) energy business: $40/share. 5) humanoid robots: $60/share