Morgan Stanley: Taxis and the Trillion-Dollar Traffic Portal — Converting the Top 1% of Global Taxis to Autonomous Driving is a Multiplier, Not an Experiment
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Morgan Stanley asserts that the global Robotaxi industry is shifting from technical pilots to commercial scale, projecting a USD 1 trillion market opportunity by 2040. The firm anticipates unit economics reaching breakeven by 2028, scaled operations by 2030, and a global fleet of roughly 2.5 million vehicles by 2035. The United States and China currently lead the sector, while Europe and broader Asia may emerge as significant players later in the decade. Cost deflation remains a critical catalyst, with China-made Robotaxi bill of materials (BoM) expected to drop to USD 35,000–40,000 by 2027, continuing to decline at a 3–5% CAGR. The report introduces a Robotaxi 30 framework to map competitors and business models across regions and value chains. Waymo and Tesla are expected to become global leaders based on their installed bases and technological depth. Four categories of regional players are emerging: L4 startups (Zoox, WeRide, Pony.ai), ride-hailing platforms (Uber, DiDi), EV manufacturers with autonomous capabilities (XPeng), and technology giants (Baidu). Regarding wealth creation, autonomous driving players are positioned to benefit, the outlook for EVs is neutral, and traditional internal combustion engine vehicles face increasing sales pressure. Near-term catalysts include driverless expansion and regulatory momentum, while key risks involve uneven regulation, safety incidents, slower-than-expected unit economic improvements, and global expansion complexities.