These 2 Stocks Are Expected to Experience Volatility During Tesla’s Robotaxi Event

As Tesla gears up for its much-anticipated robotaxi event, analysts at RBC Capital are predicting potential volatility in the stock prices of major ride-sharing companies, Uber and Lyft.

The upcoming event aims to highlight Tesla’s progress in autonomous vehicle technology, and its ramifications could significantly impact these competitors. Market reactions will likely depend on the specifics shared by CEO Elon Musk regarding aspects such as regulatory approvals, launch timelines, pricing strategies, and liability issues.

According to RBC, while investors in Uber and Lyft are already cognizant of the competitive threats posed by Tesla, the insights provided during the event could nonetheless prompt notable market movements.

The analysts noted, “We see potential for dislocation with the magnitude depending on the depth and detail Tesla’s CEO provides around regulatory approval, launch timing, pricing, supply and demand acquisition strategies, and liability exposure.”

They cautioned that disruptions could occur if Tesla reveals plans to subsidize pricing or make adjustments that could alter the economics for driver-owners, enabling it to capture more market share.

RBC believes such actions could significantly transform the competitive landscape. They emphasized that a range of stakeholders in the autonomous vehicle ecosystem—including original equipment manufacturers (OEMs), vehicle owners, and technology providers—could benefit from the expansion of the total addressable market.

The analysts stated, “We believe many parties can win with AVs expanding the total addressable market and the capture rate of vehicle miles traveled, with Uber and Lyft being beneficiaries.”

As the event draws near, the market is likely to react to any announcements regarding Tesla’s testing phases for its autonomous ride-hailing service, which could launch within the next year.

In conclusion, the analysts urged investors to prepare for potential impacts, while also considering opportunistic buying in response to any weaknesses in stock performance that may arise from the event.