Tesla's autonomous trucks could be huge for the industry but only a small part of Tesla (TSLA)
TED
Tesla is expected to announce a new autonomous semi-truck this month, and it could shake up the trucking industry more than any other innovation in the last decade.
The new trucks are expected to be electric, autonomous and cost about $100,000 a piece, according to a recent note from Ravi Shanker, an analyst at Morgan Stanley. Shanker thinks Tesla will end up leasing the batteries in the trucks to keep the initial costs low and build out a nationwide network of battery swapping stations to quickly change batteries and get trucks back on the road after the approximately 300 miles of battery range is depleted.
Applying Tesla's work on autonomous driving in the consumer space to the trucking industry makes sense. Semi-trucks are often driving on long stretches of highway where Tesla's advanced autopilot technology is already autonomously driving its consumer vehicles. This prowess could lead to quick disruption in the industry.
Tesla is likely to roll out the new trucks to a limited number of partners before opening for preorders. Any company that is slow to preorder a truck from Tesla would be placed at the back of the line for the autonomous trucks, which could mean the difference of years based on Tesla's current production abilities, according to Shanker.
Shanker expects demand for the new trucks to hit more than 25,000 units. The trucks may not be released until 2020, but with cost savings around 70% compared to traditional human drivers, the demand will be high, said Shanker. He said Tesla could capture about 10% of the total truck market with its new vehicles.
Once other technology companies see the high demand for Tesla's trucks, Shanker expects the industry to refocus on developing rival autonomous semi-truck technology.
Shanker thinks the trucks could eventually represent only 10% of Tesla's total market value, as the demand for commercial trucks is smaller than consumer vehicles. The impact on the transportation industry would be huge, however.
Tesla is up 60.95% this year and is trading at about $345 on Wednesday.
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