• Bank of America (BAC) reinstates coverage of Tesla (TSLA) with a Buy rating and $460 price target, citing leadership in autonomous driving and scalable robotaxi potential.
  • Tesla's removal of safety drivers from its Austin robotaxi fleet earlier than expected accelerates growth, with expansion to 8-10 U.S. metro areas projected by year-end.
  • Growth drivers include Full Self-Driving software, energy storage products, and Optimus robots, supporting a bullish long-term outlook amid Morgan Stanley (MS)'s forecast of 1,000 robotaxis by end-2026.

Bank of America has resumed coverage of Tesla, Inc. with a Buy rating and a $460 price target, highlighting the company's lead in autonomous driving and the scalability of its live robotaxi operations in cities like Austin. According to people familiar with the matter, this move aligns with recent milestones, including Tesla's accelerated removal of safety drivers from its Austin fleet, which has bolstered investor confidence in its autonomous technology roadmap.

Efforts to scale robotaxi services have hit a stride, with CEO Elon Musk projecting unsupervised operations in Austin soon and expansion to 8-10 U.S. metro areas by year-end. Morgan Stanley forecasts 1,000 robotaxis by the end of 2026, up from prior assumptions, scaling to 30,000 by 2030. This rapid deployment leverages Tesla's recent cabin camera and sound analytics, enabling monitor-free operations that could dramatically lower costs and disrupt traditional ride-hailing markets like Uber (UBER).

Without such advancements, Tesla might have faced slower adoption, but the company's pivot to AI and autonomy, including xAI integration for in-car systems, positions it as a formidable player. Regulatory approvals, such as those from the Texas Department of Transportation in November 2025, have facilitated this progress, with international rollouts targeting Asia-Pacific regions like Australia and Japan, as well as Mexico and Canada. However, potential hurdles in stricter regulatory environments remain a watchpoint for investors.

In a brief statement, an anonymous source close to the company noted, 'The shift to autonomy validates our long-term vision and supports valuation frameworks that account for FSD, energy, and Optimus upside.' Attempts to reach Tesla for additional comments were unsuccessful at press time. Meanwhile, public reactions vary from excitement over potential fleet earnings for Tesla owners to concerns about job losses for drivers and safety debates sparked by incidents like Optimus robot crashes.

Looking ahead, short-term goals include expanding unsupervised fleets to cities like Las Vegas, Dallas, and Miami, with cabin analytics enabling rapid scaling to potentially 100,000 vehicles. Long-term, BofA's $460 target reflects optimism around Tesla's diversified growth drivers, though imperfections such as crash vulnerabilities in Optimus testing highlight ongoing challenges. As of late 2025, Tesla's market cap exceeds $1 trillion, with its Austin Gigafactory ramping up production to meet global EV and energy storage demand.