Morgan Stanley: EV industry may get a boost by Tesla supercomputer

According to Morgan Stanley, Tesla's supercomputer, Dojo, which trains AI models for autonomous vehicles, may provide the

electric vehicle

Tesla began producing the Dojo in July and anticipates spending over $1 billion over the course of the following year. Dojo can open up new addressable markets that "extend well beyond selling vehicles at a fixed price," according to a note sent on Sunday by Morgan Stanley analysts under the direction of Adam Jonas.

“What additional markets may emerge if Dojo is successful in making cars 'see' and 'react,' I wondered. Think about any edge gadget with a camera that makes judgements in real-time based on its visual field”, added Jonas.

The Wall Street firm changed the company's rating from "equal-weight" to "overweight" and elevated Tesla's stock to the position of "top pick," displacing Ferrari's American-listed shares. According to LSEG data, Morgan Stanley increased its price goal for Tesla's shares over the next 12 to 18 months by 60% to $400. At that price, according to Morgan Stanley's estimates, the EV manufacturer would have a market capitalization of around $1.39 trillion.

After the stock price reached a closing of $248.5 on Friday, the market worth of the company was estimated to be at $789 billion.

Jonas anticipates Dojo to be the programme and service that adds the greatest value.

The analyst increased his projected income from Tesla's network services division from $157 billion to $335 billion in 2040. By 2040, nearly tripling from 2030, Jonas projects the segment to provide more than 60% of Tesla's core earnings.

According to Jonas, "This increase is primarily the result of the emerging opportunity we see in third-party fleet licencing, increased ARPU (average monthly revenue per user)."