There’s no question in my mind that unsupervised autonomy will become the dominant ride-hailing form within a few years. Ride hailing platforms with drivers will likely become extinct within 5 years. By extension, autonomous driving will become one of the most popular add-on options when buying or leasing new vehicles. Where I have always disagreed with bulls is about the level of competitive intensity in unsupervised autonomy. Unsupervised autonomy will become table stakes to survive; those that can’t master it will not stay in business. But to think $Tesla(TSLA.US) will be the only one to master and scale unsupervised autonomy when $Alphabet - C(GOOG.US) $Baidu(BIDU.US) $Pony AI(PONY.US) $WeRide(WRD.US) and $Amazon(AMZN.US) are already completing 1.0M paid unsupervised autonomous trips per week without safety monitors is borderline head-in-the-sand delusional.
When modeling TSLA economics one can’t take a capacity-based approach (# trips/day x # miles/trip x (rev - costs) per mile x # days/year). Instead one must forecast TSLA ride hailing economics based on autonomous TAM x projected TSLA market shares by market based on relative cost advantage, brand equity, and likely scale up since that will approximate Tesla demand rather than capacity. Absent advertising, TSLA may solve for and scale up unsupervised autonomy the fastest of all OEMs but may not capture their share of demand since TSLA doesn’t have the skills to communicate with and educate mass consumers in the same way $Apple(AAPL.US) did in cell phones.Why does this matter? Stocks can’t sustain multiples of 200x+ EPS or 100x EV/EBITDA unless their franchises are uniquely scalable and unassailable. TSLA’s current 2026 P/E is 200x (rolling 4-qtr forward 190x) vs 2026-2030 forecasted compound EPS growth of +37% so a PEG of 5.4x. That math doesn’t work given PEGs of 2.0-2.5x for other megacap tech stocks. One can argue the market already discounts that TSLA will be one of a handful of OEMs that solves for generalized unsupervised autonomy. Hence our assertion that TSLA is a great company with a dominant franchise but a P/E that is way too rich.
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