Could Tesla’s market capitalization double in value in the coming years? According to analysts at Wedbush, the success of Tesla’s ambitious autonomous driving initiatives, specifically the imminent launch of its robotaxi service, could pave the way for the electric vehicle giant to reach a staggering $2 trillion market cap by the end of 2026.
Led by analyst Dan Ives, Wedbush has maintained its “outperform” rating and a bullish $500 price target on Tesla stock (TSLA). The firm views Tesla’s autonomous technology as the “golden goose,” believing that increased penetration of its Full Self-Driving (FSD) software among its existing vehicle base and the anticipated acceleration of its dedicated Cybercab production in the U.S. represent the key catalysts for significant future valuation growth. Wedbush suggests that “the march to a $2 trillion valuation” is already underway, driven by what they term the beginning of a “trillion dollar autonomous era” for the company.
The Robotaxi Revolution Takes Shape
A significant focus for analysts and investors alike is Tesla’s planned robotaxi service. CEO Elon Musk had recently indicated a tentative launch date around June 22nd for the program in Austin, Texas, though emphasizing the date was subject to change due to an intense focus on safety protocols. Reports indicate that invitations have been extended to select Tesla users, granting access to an initial fleet of 10 to 20 Model Y vehicles operating fully autonomously within a designated, “geo-fenced” area of the city, transporting paying passengers.
This initial deployment is seen as just the beginning. Tesla plans to expand the service to more vehicles and cities, and eventually intends to allow existing Tesla owners to contribute their vehicles to an autonomous, Uber-like ride-sharing network. Further solidifying its autonomous future, Tesla plans to commence production of its purpose-built autonomous vehicle, the Cybercab, next year. Notably, the Cybercab is designed without a steering wheel or pedals, highlighting Tesla’s vision for truly driverless transportation. The anticipation surrounding this launch is high, with analysts like Piper Sandler seeing the confirmed testing of driverless Teslas in Austin as validation of a core component of their bullish thesis.
Navigating Recent Headwinds
The enthusiasm surrounding the robotaxi launch comes after a period of notable volatility for Tesla shares. Earlier this month, the stock experienced a sharp decline, tumbling over 14% in a single day and briefly pushing its market capitalization below the $1 trillion mark. This downturn was largely attributed to a very public spat between Elon Musk and former President Donald Trump, which played out on social media platforms.
The dispute reportedly stemmed from Musk’s criticism of a Trump-backed budget bill. The online exchange escalated, with Trump expressing disappointment and Musk responding assertively, even making controversial comments he later publicly expressed regret for. The public spat resulted in a loss of over $150 billion in market value for Tesla at its peak. Bullish analysts were particularly eager to shift investor attention away from this political drama and back towards the company’s technological developments like the robotaxi service, viewing the feud as a potentially distracting factor that could even complicate regulatory paths.
Indeed, regulatory scrutiny exists. Texas lawmakers recently sent a letter to Tesla requesting a delay in the Austin robotaxi launch until new state autonomous vehicle regulations are set to take effect in September.
Stock Performance and Future Outlook
Despite recent sales pressures and the political fallout, Tesla shares have shown resilience, recovering much of the ground lost during the Musk-Trump exchange. While still down around 20% year-to-date, the stock has stabilized, trading recently around the $324 level.
Beyond the robotaxi news, Tesla also recently announced an agreement to build its first grid-scale battery power plant in China and reiterated plans for the launch of a more affordable vehicle model this month, adding further potential catalysts to the investment narrative.
Ultimately, Wedbush’s bold prediction for Tesla’s market cap hinges heavily on the successful execution and scaling of its autonomous driving ambitions. The robotaxi launch in Austin marks a critical step in this journey, which analysts believe could unlock significant value and drive the company toward a $2 trillion valuation in the coming years.
