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Tesla Robotaxi, Autonomy, and Insurance drive new price target from ARK Invest

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ARK Invest has upgraded its price target and outlook for Tesla through 2025, projecting massive gains as the automaker continues to dominate the electric vehicle market. ARK analysts now believe that Tesla’s outlook is even better than before, boosting its price target from $1,400 in 2024 to $3,000 in 2025. The new figures depend on Tesla’s rollout of Robotaxi, a fully-autonomous vehicle, and its expanding insurance initiative.

ARK released a new report on March 19th that outlined the firm’s real-world expectations for Tesla. Already holding the reputation as one of Tesla’s biggest bulls, ARK revised its price target by pushing its forecast forward by one year from 2024 to 2025. Also, ARK became even more bullish by boosting its outlook from $1,400 in 2024 to $3,000 in 2025. ARK wrote:

“Last year, ARK estimated that in 2024 Tesla’s share price would hit $7,000 per share, or $1,400 adjusted for its five for one stock split. Based on our updated research, we now estimate that it could approach $3,000 in 2025.”

Credit: ARK Invest

The key updates ARK made to its model were that it refined the estimates for Tesla’s capital efficiency, the addition of Tesla’s Insurance initiative, which is set to open in more U.S. states shortly, new assumptions for the possible rollout of Robotaxi, and the probability that the automaker successfully achieves fully autonomous capabilities within the next five years.

Production Expansion

ARK’s general outlook on Tesla remains extremely bullish. The firm wrote that it believes the company can expand its production and sales capacities between 5 and 10 million vehicles by 2025. The additional year of growth capability due to the newly-revised price target, along with several other metrics, has ARK projecting massive sales figures within four years. Coming off its biggest year in terms of sales, where Tesla managed to deliver 499,650 cars in 2020, this would roughly project a between 10x and 20x growth in four years. It doesn’t seem far-fetched as Tesla continues to roll out more efficient production methods thanks to manufacturing efficiencies. Additionally, the supplemental production figures from Giga Texas and Giga Berlin also indicate that Tesla will be in prime position to expand its production metrics considerably within the next several years.

Credit: ARK Invest

Currently, Tesla projects each of its three active production facilities to produce approximately 1,050,000 vehicles per year.

Tesla Insurance

Meanwhile, Tesla’s Insurance program has been added to ARK’s new projection. While the in-house insurance initiative is only currently available in California, documents show that Tesla drivers in several other U.S. states are set to have it available to them. Tesla’s “better-than-average” safety profiles, thanks to an increased focus on passenger safety, Tesla has the ability to use real-time data to offer insurance in its vehicles, ARK said. This could increase pricing dynamics and lower customer acquisition costs, thus increasing margins. “In our bull case, ARK estimates that, as robotaxis ramp, Tesla’s insurance revenues will be incorporated into a platform fee. Insurance boosts our price target by roughly $60 in 2025,” Tasha Keeney of ARK also wrote.

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Tesla Robotaxi and Fully-Autonomous Vehicles

Tesla’s human-driven and fully-autonomous ride-hailing services also provided a substantial boost to ARK’s general outlook for 2025. “In our bear case example, ride-hail could add an additional $20 billion to Tesla’s operating profit by 2025, increasing our price target by about $500,” Keeney said. The rollout of a fully-autonomous service could be preceded by a human-driven service, providing a highly-profitable recurring revenue stream and limiting the downside of the possible failure of a fully-autonomous service.

Tesla bull Cathie Wood talks Robotaxis and ARK Invest’s greater conviction in TSLA

The possibility of a fully-autonomous vehicle coming from Tesla is around 50% for 2025, increasing from the 30% projection ARK held for 2024. Tesla’s increased focus on Neural Networks along with a quickly-growing vehicle fleet gives the automaker the possibility to scale an accurate and effective Robotaxi service, opening up the door for additional cash flow. ARK added that:

“If 60% of its vehicles equipped with Autopilot were to serve as robotaxis, Tesla could generate an additional $160 billion in EBITDA in 2025. In our bull case, ride-hail would account for the majority of Tesla’s enterprise value in 2025.”

ARK states that its bearish outlook shows Tesla shares could be worth around $1,500. Meanwhile, its bull case projects $4,000 per share. Interestingly, ARK’s projections do not model Tesla’s energy storage or solar business, nor did it include the recent $1.5 billion bitcoin investment, which has given Tesla significant profitability.

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ARK’s full report is available here.

Disclosure: Joey Klender is a TSLA Shareholder.

Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on X @KlenderJoey. If you're looking for great Tesla accessories, check out shop.teslarati.com

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Investor's Corner

Tesla Board member and Airbnb co-founder loads up on TSLA ahead of robotaxi launch

Tesla CEO Elon Musk gave a nod of appreciation for the Tesla Board member’s purchase.

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(Credit: Tesla)

Tesla Board member and Airbnb Co-Founder Joe Gebbia has loaded up on TSLA stock (NASDAQ:TSLA). The Board member’s purchase comes just over a month before Tesla is expected to launch an initial robotaxi service in Austin, Texas.

Tesla CEO Elon Musk gave a nod of appreciation for the Tesla Board member in a post on social media.

The TSLA Purchase

As could be seen in a Form 4 submitted to the United States Securities and Exchange Commission (SEC) on Monday, Gebbia purchased about $1.02 million worth of TSLA stock. This was comprised of 4,000 TSLA shares at an average price of $256.308 per share.

Interestingly enough, Gebbia’s purchase represents the first time an insider has purchased TSLA stock in about five years. CEO Elon Musk, in response to a post on social media platform X about the Tesla Board member’s TSLA purchase, gave a nod of appreciation for Gebbia. “Joe rocks,” Musk wrote in his post on X.

Gebbia has served on Tesla’s Board as an independent director since 2022, and he is also a known friend of Elon Musk. He even joined the Trump Administration’s Department of Government Efficiency (DOGE) to help the government optimize its processes.

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Just a Few Weeks Before Robotaxi

The timing of Gebbia’s TSLA stock purchase is quite interesting as the company is expected to launch a dedicated roboatxi service this June in Austin. A recent report from Insider, citing sources reportedly familiar with the matter, claimed that Tesla currently has 300 test operators driving robotaxis around Austin city streets. The publication’s sources also noted that Tesla has an internal deadline of June 1 for the robotaxi service’s rollout, but even a launch near the end of the month would be impressive.

During the Q1 2025 earnings call, Elon Musk explained that the robotaxi service that would be launched in June will feature autonomous rides in Model Y units. He also noted that the robotaxi service would see an expansion to other cities by the end of 2025. “The Teslas that will be fully autonomous in June in Austin are probably Model Ys. So, that is currently on track to be able to do paid rides fully autonomously in Austin in June and then to be in many other cities in the US by the end of this year,” Musk stated. 

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Investor's Corner

Tesla hints at ‘Model 2’ & next-gen EV designs

Tesla’s Q1 2025 update confirms new models this year, with production tied to existing factory lines. Could it be time for the Model 2 debut?

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(Credit: Tesla)

During its Q1 2025 earnings call, Tesla executives hinted at the much-rumored “Model 2” and other next-gen EV designs.

Tesla slightly addressed whether or not it will be pushing forward with the debut of new models later this year in its latest earnings call. The company’s product development executive, Lars Moravy, shared some details about Tesla’s design process and the upcoming affordable models.

“We’re still planning to release models this year. As with all launches, we’re working through, like, the last minute issues that pop up. We’re knocking them down one by one. At this point, I would say that the ramp might be a little slower than we had hoped initially…But there’s nothing that’s blocking us from starting production within the next, within the timeline laid out in the opening remarks.

“And I will say it’s important to emphasize that, as we’ve said all along, the full utilization of our factories is the primary goal for these new products. And so the flexibility of what we can do within the form factor and, you know, the design of it is really limited to what we can do on our existing lines rather than building new ones. But we’ve been targeting the low cost of ownership. Monthly payment is the biggest differentiator for our vehicles, and that’s why we’re focused on bringing these new models with the, you know, the lowest price, to the market, within the constraints I just highlighted.”

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In January, Tesla’s Chief Financial Officer Vaibhav Taneja teased several new product introductions for this year. There is at least one product that most Tesla supporters and investors are hoping to see: the company’s affordable vehicles, which have been dubbed by the EV community as the “Model 2” or “Model Q.”

Before Tesla’s Robotaxi event last year, many speculated that the company would also unveil its affordable next-gen vehicle. Gene Munster from Deepwater had expected Tesla to release a stripped-down version of the Model 3 as its affordable vehicle during the Robotaxi event. In the end, Tesla unveiled its Robotaxi vehicle and its Robovan design.

It’s been a while since the Robotaxi event, and Tesla has kept mum about its affordable vehicle. Considering its Q1 2025 performance, TSLA investors look forward to catalysts that could boost the stock.

The “Model 2” has been labeled a potential catalyst for Tesla. As such, TSLA investors and supporters have been itching for news about the new affordable vehicle. The main questions surrounding the “Model 2” revolve around its design and price. Based on Moravy’s statement, the “Model 2’s” design will heavily depend on Tesla’s current assembly lines and supply chain structures.

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Elon Musk

Tesla regains Piper Sandler’s confidence with Robotaxi plans & Q1 Results

Piper Sandler says Tesla delivered the best-case scenario for bulls. $TSLA has catalysts ahead to silence the bears.

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tesla-model-y-delivery
(Credit: Tesla)

Tesla gained Piper Sandler analyst Alexander Potter’s confidence following its Q1 2025 earnings call. Piper Sandler reaffirmed its Overweight rating and $400 TSLA price target, signaling optimism for the company’s robotaxi and affordable vehicle launches expected this year. The firm’s stance reflects Tesla’s resilience amid market challenges.

Despite expectations of weak Q1 financials, Tesla’s stock edged up in after-hours trading, defying skepticism. Piper Sandler’s Alexander Potter noted that the results met the hopes of Tesla supporters, particularly as the company held firm on its timelines. Potter emphasized that anticipation for robotaxi details and new vehicle launches should keep critics at bay, supporting the $400 target.

“In our preview last week, we predicted that (at best) Q1 would be a non-event. With the stock trading up slightly in the after-hours session, it appears our best-case scenario has materialized. Considering generally weak Q1 financials, we think this is the best result that TSLA bulls could’ve reasonably hoped for.

“In our view, the most important Q1 takeaway is this: Tesla didn’t hedge expectations re: launching Robotaxis or lower-priced vehicles in 1H25. With <2 months until the end of June, investors can look forward to some interesting catalysts in the weeks ahead. In our view, this alone should be enough to keep the bears at bay, at least until we have a better idea re: the details of Tesla’s new products, as well as the scale/scope of the Robotaxi launch,” wrote Potter.

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Wedbush Securities’ Dan Ives, a longtime TSLA bull, echoed Potter’s optimism for Tesla. Ives raised his price target for Tesla stock from $315 to $350 with a BUY rating. His Tesla upgrade came after Elon Musk’s announcement during the Q1 earnings call that he would reduce his involvement with DOGE, signaling a sharper focus on Tesla.

Tesla’s steady Q1 performance and unwavering commitment to its 2025 roadmap, including the Robotaxi launch and lower-priced models, bolster investor confidence. Piper Sandler’s analysis underscores Tesla’s ability to navigate a competitive electric vehicle market while advancing its technological edge. The upcoming Robotaxi launch and affordable vehicle introductions are pivotal, with analysts expecting these initiatives to drive stock value through 2025.

As Tesla prepares for these milestones, its stock movement reflects market trust in Musk’s vision. With Piper Sandler and Wedbush reaffirming bullish outlooks, Tesla’s strategic moves will remain under close scrutiny, positioning the company to capitalize on its innovation pipeline in a dynamic industry landscape.

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