Morgan Stanley analyst Andrew Percoco reiterated an Equalweight rating and $400 price target on Tesla on Friday, in a note first obtained by Price Target.
The analyst added $20 per share to the firm’s bull case valuation — now $840 — based on a new economic model for autonomous trucking software.
The $400 target implies about 10.0% upside from Thursday’s closing price of $363.56; while the bull case, if realized, could represent upside of approximately 131.1%.
Percoco outlined how Tesla could generate between $12,000 and $18,000 per month from each autonomous Semi truck through software licensing alone — dwarfing the approximately $100 per month the company currently charges for its Full Self-Driving subscription on consumer vehicles.
Autonomous Trucking Economics
Morgan Stanley’s freight transportation team “published an Insight reinforcing their bullish view on the prospects for Autonomous Trucking and its transformative power for the Freight Transportation industry,” Percoco wrote.
Working with that team, the analyst said he “built an economic analysis for an autonomous EV truck vs. a human driver, and developed a new Tesla Semi model, assuming a tech licensing fee per mile.”
Updated total cost of ownership calculations show autonomous fleets could deliver about 20% net cost savings. Percoco described the return on invested capital as “very attractive,” with savings “primarily driven by labor, fuel and insurance savings.”
Under the base operating and utilization assumptions, an autonomous fleet “should be 6-8x as profitable as a human-driven fleet today,” the analysts wrote.
Percoco modeled a per-mile subscription fee of $0.85 to $1.00 for Tesla’s autonomous trucking software.
At approximately 18,000 miles driven per month, each Semi would generate between $12,000 and $18,000 in monthly software revenue.
“This compares to ~$100/month for FSD on consumer vehicles today,” the analyst noted — a gap that underscores the revenue intensity of commercial autonomy.
FSD on consumer vehicles currently costs $99 per month.
A $17 Billion Revenue Opportunity
Morgan Stanley’s updated total addressable market assumptions show “the opportunity remains significant,” Percoco wrote, estimating that “the TAM ranges from $0.5-1.1 tn in the US alone by 2041.”
The analyst assumed Tesla captures a 13.5% share of the autonomous addressable market, reaching 82,000 Semis on the road by 2040.
“If Tesla reaches 82k Semis on road by 2040,” Percoco wrote, “that would represent $17bn of software revenue and ~$7.5bn of incremental EBIT” — amounting to 10% upside to Morgan Stanley’s base case.
Percoco stressed that figure excludes hardware and energy revenue.
“Note that this does not include the upfront sale of the vehicle or incremental revenues for Tesla charging,” the analyst added.
Percoco described the 82,000-unit deployment as conservative.
“Tesla originally outlined a manufacturing target of 50,000 Semi trucks per year, therefore assuming 80k will be deployed in total over the next ~15 years is a conservative starting point, in our view,” he wrote.
Semi Production
Morgan Stanley’s note arrives as Tesla accelerates its Semi program.
The first truck came off the high-volume line on April 29 at a dedicated 1.7-million-square-foot factory adjacent to Gigafactory Nevada, with a nameplate capacity of 50,000 units per year.
Tesla’s second-quarter shareholder deck moved the target for high-volume production to 2027.
Analyst estimates for 2026 deliveries range from 5,000 to 15,000 units as the line scales.
Semi program Director Dan Priestley has said the pre-volume fleet has logged more than 13.5 million miles in commercial operation.
Fleet orders have accelerated alongside the production ramp.
Swedish logistics company Einride placed a 500-unit order in August — the largest publicly announced Semi purchase to date — to serve Amazon and other customers across five US states.
DHL, PepsiCo and several California-based freight operators are also deploying or expanding Semi fleets.
Tesla has scheduled a formal inauguration of the Nevada Semi factory for September 24.
Commercialization Debate
Morgan Stanley’s freight team reinforced a bullish view on the broader autonomous trucking sector.
“After a decade spent on technology development, the debate in the final 12-18 months (until the start of serial production) shifts to the commercialization pathway,” Percoco said.
The analysts added that “proprietary surveys plus AlphaWise geolocation analysis breaks down some popular myths regarding adoption obstacles, while highlighting remaining friction points.”
Percoco layered the autonomous trucking software model into his existing bull case for Tesla’s Network Services segment, “adding $20/shr to our Bull Case (now $840).”
Before this note, the bull case stood at $820.
Capex Concerns Linger
Morgan Stanley’s base case remains more measured.
Percoco lowered the price target to $400 from $417 in late July, writing that “the capex step-up is a known trend, now confirmed and extended for the next 2-3 years, prolonging cash burn through the end of the decade.”
Percoco added at the time that he viewed this “as a necessary investment to establish and defend a leadership position in autonomy and robotics,” but cautioned that “the open question remains the timing of when we actually see the ROI.”
Specifically, he mentioned a scaled robotaxi network and tangible progress commercializing the Optimus humanoid robot.
“Absent consistent, transparent proof points, we’d expect the market’s tolerance for incremental capex to narrow,” the analyst warned.
Morgan Stanley now projects Tesla will spend nearly $30 billion in capital expenditures in 2027, up from a prior estimate of $20 billion, driving an estimated free cash flow burn of about $14 billion.
Tesla has faced pressure from declining US sales this year, despite growing demand in Europe, as opposed to a year ago.
Motor Intelligence data showed August volumes fell 26% year-over-year to 40,800 units — the steepest monthly decline of 2026.
However, the base of comparison was high, as August and September 2025 were the last two months before the EV tax credit expired in the US.
Percoco has maintained his Equalweight rating through each of the past three notes, signaling that the autonomous trucking upside is a bull-case scenario rather than a shift in his base-case thesis.
Percoco raised his delivery estimate for Tesla‘s second quarter to 413,000 vehicles in late June, citing recovering demand in Europe and China.
Earlier this year, the analyst called the company’s robotaxi expansion into Dallas and Houston “a material evolution,” and in December 2025 projected Tesla would operate 1,000 robotaxi vehicles by year-end 2026 and one million by 2035.
