Tesla has begun operating unsupervised vehicles publicly in Austin, removing safety drivers from part of its fleet. Morgan Stanley calls this a critical milestone for the company's vision-only approach to autonomy, validating its robotaxi ambitions and $125-per-share valuation framework.

CEO Elon Musk expects to eliminate safety drivers in Austin within months and launch robotaxi services in 8-10 metro areas by year-end. Morgan Stanley now projects Tesla could deploy 1,000 robotaxis by end-2026, scaling to 30,000 by 2030 and potentially 5 million by 2040.

The accelerated timeline challenges conventional autonomous vehicle industry assumptions, particularly around optical-only systems. If Tesla expands successfully with strong safety data, it could reshape the competitive landscape and significantly impact its long-term revenue projections and market valuation.