Tesla's $4.20 Robotaxi Just Shook Wall Street -- $100 Billion Added Overnight
Tesla (NASDAQ:TSLA) just gave Wall Street a new reason to believe in its AI-first future. On Sunday, the company quietly rolled out a limited fleet of robotaxis in Austin, Texas offering $4.20 flat-fee rides without human drivers. It's the first time real passengers have paid to ride fully autonomous Teslas, and on Monday, the market responded in kind: the stock jumped 10%, adding nearly $100 billion to Tesla's valuation. For Elon Musk, it's a critical pivot away from chasing mass EV adoption, and toward a bet-the-company push into autonomy and robotics.
Early reactions? Mixed, but promising. Wedbush's Dan Ives took multiple rides and called the experience comfortable and safe, noting how the car handled narrow roads, traffic, and human unpredictability with striking caution. Influencers on X flooded the feed with real-world footage, showing Teslas navigating tight city blocks and reacting to opening car doors without panic. But it's still early. Just 10 cars, front-seat monitors still present, and a Texas law kicking in this September will require a state permit. Plus, Tesla's camera-and-AI-only approach (no lidar or radar) continues to raise red flags with safety advocates especially in fog, rain, or low sun.
If the rally holds, Tesla inches back toward its $1 trillion crown. But the stock's still down 12% in 2024, as investors wrestle with slumping EV demand and the brand baggage of Musk's political takes. And at 149x forward earnings? It's priced more like a moonshot AI play than an automaker. Ford (NYSE:F) trades at 9.3x. Microsoft (NASDAQ:MSFT) sits at 31.6x. That leaves Tesla with a simple but brutal test: can this robotaxi rollout scale fast enough and safe enough to justify the hype investors just bought into?
This article first appeared on GuruFocus.
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