‘Investors Need More Proof of Real Autonomy,’ Says MS as Tesla’s FSD Nears 10B Miles

EV maker Tesla (TSLA) is approaching a key milestone, with nearly 10 billion miles driven using its Full Self-Driving (FSD) system. However, five-star Morgan Stanley (MS) analyst Andrew Percoco warns that investors need more proof of real autonomy. While FSD can handle most driving tasks, it is still not fully autonomous because drivers must stay alert and be ready to take over. Therefore, the milestone is important, but it does not yet confirm that Tesla has achieved true self-driving. As a result, Percoco believes the focus should now shift to whether unsupervised autonomy is actually close.

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At the same time, the financial side is becoming a bigger concern, especially as spending continues to rise. Percoco estimates that Tesla will spend about $20.7 billion in capital expenditures in 2026, which is in line with the company’s guidance of over $20 billion. However, at that level, Tesla could burn around $8.4 billion in free cash flow. If projects like Terafab and Tesla Solar are included, total spending could increase further to between $25 billion and $30 billion. Because of this, investors are starting to question how sustainable this level of investment will be.

As a result, the debate around Tesla is becoming more divided between long-term potential and near-term risks. Bulls continue to focus on AI and robotaxis as major future drivers, while bears are more concerned about rising costs and uncertain timelines. So far, Tesla’s robotaxi activity in Austin remains limited and is still moving toward less supervised driving rather than a full rollout. Meanwhile, production of the CyberCab is expected to begin soon. With earnings set for April 22, investors will be watching closely for updates on both autonomy progress and spending plans.

What Is the Prediction for TSLA Stock?

Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 13 Buys, 10 Holds, and seven Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $402.29 per share implies 14.8% upside potential.