Tesla’s autonomous-driving bet is sparking one of Wall Street’s most heated debates: could the electric carmaker’s Full Self-Driving software unlock more upside than the already-surging AI chip giants?
While Nvidia and AMD have dominated returns from generative AI infrastructure investments, with Nvidia up over 1000% over three years and AMD capturing the data-center boom, Tesla remains the unpricier story, trading at a P/E of 42.8 versus Nvidia’s 72.3.
Wedbush analyst Dan Ives now calls Tesla’s AI and robotaxi business worth up to $1–2 trillion in incremental value, claiming the opportunity rivals anything seen in modern markets.
Meanwhile, Melius Research just branded Tesla a “must own,” arguing that autonomy is nearing an irreversible tipping point that will shift hundreds of billions in value toward the company over five years.
The question for investors is clear: Is Tesla’s robotaxi vision a genuine value transfer play, or are Nvidia and AMD the safer bets because their AI upside is already proven and partially priced in?
From EV laggard to AI contender? Tesla’s FSD bet versus chip-stock high flyers
Tesla’s narrative has fundamentally shifted.
The company is no longer just an automaker; it’s increasingly framed as an AI and autonomy play, bolstered by a massive real-world driving dataset, in-house chip development, and Full Self-Driving software that just hit version 14.2.
In late November, CEO Elon Musk announced Tesla’s Austin robotaxi fleet will double in December, while the company pursues expansion to the Bay Area, Arizona, and 8–10 US cities by year-end.
These aren’t fantasy timelines; they’re active deployments requiring regulatory approval but already underway.
Melius analyst Rob Wertheimer frames the opportunity this way: autonomy is a $7 trillion sector, and “the world is about to change, dramatically” as years of incremental progress suddenly tip into mass adoption.
Tesla’s lead is widening, Wertheimer argues, because legacy automakers are “struggling with outdated architectures and fragmented supplier systems”.
By contrast, Nvidia and AMD face a different equation. Both have already captured massive market share in AI infrastructure, and valuations reflect decades of expected data-center spending.
While some bulls argue that Nvidia’s valuation, at roughly 25x earnings despite 40%+ growth expectations, still leaves room to run, the low-hanging AI fruit is arguably already plucked.
Robotaxi boom or hype risk? What pros say about Tesla versus Nvidia and AMD
The bullish case for Tesla hinges on software and services scaling faster than anyone expects.
If robotaxis achieve full Level 4 autonomy and regulatory green lights, Tesla shifts from a capital-intensive automaker into a high-margin AI platform company. But skepticism is warranted.
Waymo operates 1,500 vehicles, has clocked 100+ million autonomous miles, and now operates in Dallas, Houston, Miami, and other cities with plans for New York and DC, a proven model.
Amazon’s Zoox is ramping production capacity to 10,000 robotaxis annually at its Hayward facility.
Regulatory uncertainty, past timeline delays, and questions about Tesla’s timeline to true driverless operations (without safety monitors) remain real risks.
The reality: Nvidia and AMD remain core, visible AI infrastructure bets with clearer near-term earnings visibility.
Tesla is a higher-risk, potentially higher-reward autonomy play. The key variable is how fast and how safely FSD truly goes mainstream.
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