US stock futures inch lower after Wall St marks fresh records on tech gains
Investing.com - Morgan Stanley has drawn parallels between the TikTok situation and future implications for Tesla (NASDAQ:TSLA) and the broader embodied AI sector. Tesla, currently valued at $1.4 trillion and maintaining a strong financial health score according to InvestingPro, stands as a prominent player in the automotive industry with over $92 billion in annual revenue.
The investment bank suggests that Chinese expertise in manufacturing low-cost EVs, batteries, and motors will eventually need to reach American consumers, potentially through a model where U.S. technology combines with Chinese manufacturing capabilities that could be onshored.
Morgan Stanley indicates trade tensions between China and the U.S. may have already peaked, at least in the automotive sector, and predicts that ambitious Chinese moves in embodied AI will likely trigger bipartisan U.S. support for similar domestic technologies.
The firm notes that China currently leads the West in AI robot production, including humanoids, and expects this advantage to widen over the next 3-5 years before any narrowing occurs.
Morgan Stanley concludes that "a viable US-based, AI-enabled robotics business will rely on China for the foreseeable future," while pointing out that Chinese companies represent 30 of the 100 names in their global Humanoid 100 index.
In other recent news, Tesla has reached a confidential settlement with the family of a teenager involved in a fatal 2019 crash with a Model 3 using Autopilot, avoiding a scheduled jury trial. Additionally, CEO Elon Musk purchased nearly $1 billion in company shares, marking his first purchase since 2020, which analysts from William Blair view as a sign of confidence in Tesla’s future, particularly its robotaxi initiative. Meanwhile, the U.S. National Highway Traffic Safety Administration has initiated a preliminary evaluation into approximately 174,290 Tesla Model Y vehicles due to reports of malfunctioning electronic door handles.
Morgan Stanley analysts have highlighted Tesla’s Full Self-Driving (FSD) technology as a "game changer" after a 1,400-mile road trip demonstrated its reliability and convenience. The FSD managed over 99% of the driving, significantly reducing driving stress. Cantor Fitzgerald has reiterated its Overweight rating on Tesla, maintaining a price target of $355, citing positive observations about autonomous vehicle strategies. These developments provide investors with a range of insights into Tesla’s ongoing activities and future prospects.
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