Wedbush’s Dan Ives predicts Tesla FSD penetration will rise from 12% to above 50%, but doesn’t say how
Ahead of earnings Wednesday, a new note on Tesla from Wedbush Securities analyst Dan Ives argues the company is on the cusp of a Robotaxi-driven transformation, with Full Self-Driving penetration rising above 50% and autonomy unlocking as much as $1 trillion in value — putting Tesla on a path to a $2 trillion to $3 trillion market cap over the coming year.
The issue isn’t the optimism; it’s the absence of mechanics. FSD penetration across Tesla’s global fleet currently sits in the low teens. The note doesn’t explain how Tesla bridges that gap — whether through pricing changes, bundling, or a behavioral shift among mass-market buyers. Tesla is ending the option to buy FSD outright in favor of subscriptions, but that alone isn’t going to push adoption from roughly 12% to 50%.
Ives treats Tesla’s Robotaxi progress as inevitable rather than conditional. The removal of safety drivers in Austin — which for now is isolated to two or three vehicles and involves using an extra car to follow the Robotaxi — is framed as a tipping point. But there’s little discussion of scaling risks, regulation, real-world performance data, or actual demand. Ives only says President Trump will likely issue an executive order on autonomous rules and regulatory hurdles will effectively disappear — with the implication that FSD adoption would accelerate rapidly.
Even near-term fundamentals are stretched to support the narrative. Tesla didn’t beat Q4 delivery expectations, though Ives says it did, having previously cited whisper numbers rather than the analyst consensus. That claim is then used to clear the runway for a valuation argument focused almost entirely on future autonomy.
In the end, this is less an earnings preview note than a statement of belief: autonomy works; adoption follows; Tesla wins at scale.
That story may eventually prove right — but for now, it’s an assertion that outstrips the evidence.
