RBC Capital analyst Tom Narayan states, "Robotaxis account for 44% of [Tesla's] valuation. FSD accounts for another 33% of our valuation and we see private AVs becoming living rooms, bedrooms and offices on wheels."
Narayan believes that Full Self-Driving (FSD) will eventually reach Level 4 SAE designation, allowing vehicles to drive autonomously in specific conditions without human intervention, with aspirations for a fully operational robotaxi service.
Despite high expectations set by CEO Elon Musk, the current status of Tesla's Full Self-Driving capabilities indicates that they are not close to achieving their ambitious goals for autonomy.
Tesla's valuation heavily relies on promises of autonomy, leaving 77% of its value at risk if these lofty expectations for self-driving technology are not delivered.
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