Bank of America Raises Tesla Target to $460 as Viral FSD Safety Video Sparks Scrutiny
A viral video showed a Tesla driver asleep under Full Self-Driving (Supervised), intensifying scrutiny of its Level 2 autonomy and California legal challenges over misleading autonomy claims. Bank of America reinstated a Buy rating with a $460 target, citing robotaxi fleet expansion and a potential $30 billion Optimus robotics opportunity.
1. Viral FSD Video Sparks Safety Concerns
A viral clip captured a Tesla driver asleep while Full Self-Driving (Supervised) handled steering and braking, illustrating the risks of Level 2 systems that legally require driver engagement. It highlights potential liabilities as Tesla defends its naming and features against allegations of false advertising.
2. California Legal Battle Over Autonomy Claims
Tesla is contesting a California DMV ruling that it misled consumers by labeling its system as "Autopilot" and "Full Self-Driving." The company filed suit to reverse threats to revoke its manufacturing and dealer licenses, underlining regulatory headwinds facing its assisted-driving technology.
3. Bank of America Reinstates Buy Rating
Bank of America resumed coverage on Tesla with a Buy rating and set a $460 price target, forecasting upside based on autonomous driving leadership. The firm emphasized Tesla’s scalable camera-based self-driving data network as a competitive advantage over rivals.
4. Robotaxi Expansion and Optimus Valuation
Tesla’s robotaxi operations currently run in San Francisco and Austin, with planned rollouts into seven additional markets this year, promising lower costs without human drivers. The bank also assigned a $30 billion value to Tesla's Optimus humanoid robot segment, contributing to sum-of-the-parts valuation gains.