Tesla Inc. (TSLA) has hit an important milestone in its autonomous driving ambitions, removing safety drivers from robotaxi tests in Austin. For a company that's been promising self-driving cars for years, this represents tangible progress worth paying attention to.
Analyst Perspective on the Milestone
Goldman Sachs analyst Mark Delaney maintained a Neutral rating on Tesla with a $400 price target while commenting on the development. Notably, Delaney had recently trimmed his target from $425 following Tesla's third-quarter financial results, so he's not exactly a raging bull on the stock right now.
Still, he sees the Austin testing as significant. "We believe that removing the monitor for testing shows that Tesla is making progress with its autonomous technology," Delaney noted in his investor update.
The timeline here matters. Tesla had previously said it would complete this safety-driver-free testing by the end of 2025, and they're actually hitting that mark. The broader plan calls for launching robotaxi service in eight to ten metro areas by year-end 2025.
The Real Challenge: Scaling and Profitability
"We think the key focus from here will be how fast Tesla can scale driverless operations and on profitability," Delaney explained.
This is where things get interesting. Tesla's approach relies heavily on its vision-based system and massive data collection from its consumer vehicle fleet. The question is whether this software and hardware strategy lets them scale faster than the competition, which includes Uber Technologies (UBER), Lyft Inc. (LYFT), Waymo, and Pony AI (PONY).
The competitive landscape is heating up. Uber expects autonomous vehicles operating in ten or more cities by the end of 2026, while Waymo already has multi-city operations with expansion plans underway. Delaney estimates the U.S. autonomous rideshare market will reach $7 billion by 2030, so there's real money at stake here.
FSD Software Gains Traction
Beyond robotaxis, Delaney highlighted Tesla's improving Full Self-Driving software as a positive catalyst. "We also believe Tesla is making progress with its autonomy software for consumer vehicles," he said, noting that FSD reviews have been well received.
The analyst sees both FSD subscriptions and robotaxi operations as critical profit drivers going forward. "We expect autonomous tech and AVs to be a key driver of Tesla's future profits. We continue to expect autonomy (both FSD and robotaxis) to be key drivers of Tesla's growth."
Stock Performance
Tesla stock traded up 0.4% at $477.04 on Tuesday, within its 52-week range of $214.25 to $488.54. Shares are up 25.8% year-to-date in 2025.
