Tesla plant introduction of Cybercab robotaxis and global rollout of FSD software

Tesla shares experienced gains on Thursday morning after the electric car company announced that its autonomous driving assistance systems are set to be rolled out early next year. Also planned is the introduction of new Cybercab robotaxis next month in California. In an update to the investor roadmap published on Elon Musk's social platform X, Tesla shared that its advanced autonomous driving software, Full Self-Driving (FSD), will also be available in Europe and China starting next year, pending final regulatory approvals. This strategic shift toward forward-looking products like robotaxis, powered by the group's AI technology, comes at a time when Tesla (TSLA) aims to expand its commitments beyond traditional electric vehicle production. Musk highlighted the profit potential of AI technologies, especially considering the group's efforts to offer autonomous driving software for its nearly seven million electric vehicles worldwide. This is expected to result in investments rising to around $10 billion this year. “We are doubling down on our efforts with Dojo and see a path to becoming competitive with Nvidia,” Musk told investors in July. “We really need to make Dojo successful, and we will." "Anyone who doesn't believe that Tesla will solve vehicle autonomy should not hold Tesla stock," Musk added. "They should sell their Tesla shares." Tesla will demonstrate its ambitions next month with the unveiling of the first robotaxi, called Cybercab, at an event in a Warner Bros. Discovery studio in Los Angeles. The event was originally scheduled for early August but was postponed to "make some key changes that would improve the vehicle," according to Musk. He further stated that he would be "shocked" if the first unmonitored rides couldn't take place by the end of next year. Wedbush analyst Dan Ives, a long-time Tesla supporter, labeled Tesla as "the most undervalued AI investment on the market," emphasizing that the group's autonomous and Full-Self-Driving platforms "will ultimately be the key to achieving a valuation exceeding one trillion dollars." However, technical safety issues have continued to hinder the FSD rollouts, with the technology linked to at least two fatal accidents in the past two years, including the death of a motorcyclist struck by a Model S in Seattle this summer. Musk told Tesla employees earlier this year that it was "mandatory" for North American operations to install and activate the FSD software in new Tesla vehicles and "take customers on a short test drive before handing over the car." "Almost no one actually realizes how well (supervised) FSD works," Musk wrote in the memo. "I know this will slow down the delivery process, but it is still a firm requirement." Tesla claims to have data based on approximately 300 million miles driven, a number that Musk says will "soon reach billions and tens of billions of miles." This would provide the company with an enormous competitive advantage as it continues to ramp up investments in AI and other technologies. The impact on profit margins could also be significant, as the FSD software increases the average selling price of a Tesla by $12,000, with an average price of $45,000. Musk also stated that Tesla is in discussions with a "major" original equipment manufacturer about licensing the technology and is "very open" to licensing Full-Self-Driving software and hardware to other automakers. Gene Munster, an analyst at Deepwater Asset Management and a long-time Tesla supporter, estimates that licensing the FSD technology could generate up to $20 billion annually within five years of the first contract. Tesla shares rose 2.6% in pre-market trading, reaching an opening price of $225.12, extending the stock's three-month gain to about 28.6%.