Even with lackluster electric-vehicle sales next year, Tesla’s stock could deliver for investors.
That’s according to analysts at Deutsche Bank, who cheered the company’s artificial-intelligence opportunity in a Tuesday note focused on the outlook for car companies.
“While the autos business at Tesla may underperform in 2026, we think more attention is directed towards the company’s robotaxi expansion and efforts at humanoid development,” the analysts wrote.
The Deutsche Bank analysts named Tesla Motors one of their top picks for the U.S. automotive industry, along with traditional carmakers like General Motors, Ford and Stellantis NV.
Barring any major shake-ups to the macroeconomic landscape, investors will likely continue to ignore weakness in Tesla’s core business, according to the Deutsche Bank team. The stock has climbed 16% so far this year, even as sales have come under pressure in key markets such as China.
The company is expected to deliver 450 million EVs in the current quarter, down from the 496 million it sold a year ago, according to the FactSet analyst consensus. Overall in 2025, Tesla is set to report sales of 1.66 billion, which would mark its second straight year of declines.
That dynamic could continue in 2026, as Tesla faces increased competition abroad and an unfavorable regulatory environment at home. Deutsche Bank expects EV penetration to remain flat or even shrink next year. Morgan Stanley analysts agree, estimating a 20% drop in battery-EV sales.
But the impact to Tesla’s stock could be muted, partially because many investors now think of Tesla as less of an automaker, and more of an AI and robotics firm that also sells EVs. That’s an idea that CEO Elon Musk has repeatedly encouraged.
“We should be thought of as an AI robotics company,” Musk said on an earnings call last year, adding that valuing Tesla with the same framework as traditional carmakers is “fundamentally” incorrect.
Tesla has a lot lined up on the AI front for next year, including a demonstration of its next-generation Optimus robot. Morgan Stanley estimates that the market for humanoid robots will surpass $5 trillion by 2050.
The company is also expected to work on developing its nearly six-month-old ride-hailing service, which does not yet use fully autonomous vehicles. It’s currently only available in Austin, Texas, and in the San Francisco Bay Area.
By the end of the year, Tesla aims to offer its services in at least seven cities and take the safety monitor out of its vehicles in Austin. Musk has said Tesla’s robotaxi fleet could grow to about 1,500 vehicles from an estimated 152 units by the end of the year, but he recently appeared to target a more manageable goal.
Deutsche Bank said that Tesla could grow its ride-hail fleet to more than 2,500 vehicles by the end of the second quarter. But that would depend on Tesla expanding its fleet to 1,500 vehicles by early 2026 and entering additional cities.
“[I]f Tesla demonstrates Robotaxi city expansion, Cybercab production and progress on Optimus, the stock can work even if the EV business is weaker,” the analysts wrote. Production of the Cybercab, a designated robotaxi, is set for April 2026.
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