Wedbush Maintains Tesla’s $600 Price Target
Wedbush analyst Daniel Ives reiterated on October 7, 2025, Tesla’s $600 price target and ‘Outperform’ rating.
“Tesla just announced the launch of multiple new vehicles for its Model 3 and Model Y models to provide more affordable vehicle options as Tesla looks to address a major issue with EV affordability with its new cheapest Model 3 carrying an ASP of ~$37k and the new Model Y Standard carries a ~$40k price tag.
The much-anticipated lower cost models, which started production in North America in June 2025, are expected to hit the market in FY4Q25 with an increased focus on reducing complexities with its manufacturing supply chain before launch to ensure a smooth rollout despite being slower than initial expectations but this price point is still relatively high versus other vehicles on the market.
These lower cost vehicles came after Tesla put its plans for a $25k car on hold to launch its cheaper, stripped-down Model 3/Y versions which we believe will be a hurdle as the price point is still similar to when these vehicles had the tax credit applied.
We believe the launch of a lower cost model represents the first step to getting back to a ~500k quarterly delivery run-rate which will be important to stimulate demand for its fleet with the EV tax credit expiring at the end of September but we are relatively disappointed with this launch as the price point is only $5k lower than prior Model 3’s and Y’s.
Launch of FSD 14.1; Further Improvements to Autonomous Capabilities.
Earlier today, TSLA announced the launch of FSD 14.1, the first major update to this software in nearly a year featuring significant updates including arrival options for parking in streets, garages, etc., while including emergency vehicle and zone detection, smarter lane changes, and personalized features based on user data.
These capabilities are driven by a 10x increase in its neural network parameters to create a seamless experience for its users with fewer interventions especially with improving its capabilities across several niche scenarios on the road including navigating road debris, blocked roads, detour navigation, and adjusted speed settings.
Tesla is also planning to roll out more releases through the end of 2025 to further enhance autonomy moving forward giving us greater confidence in the autonomous path forward.
The AI valuation will start to get unlocked in the Tesla story and we believe the march to an AI driven valuation for TSLA over the next 6-9 months has now begun in our view with FSD and autonomous penetration of Tesla’s installed base and the acceleration of Cybercab in the US representing the golden goose for Musk & Co.
We believe Tesla could reach a $2 trillion market cap early 2026 in a bull case scenario and $3 trillion by the end of 2026 as full scale volume production begins of the autonomous and robotics roadmap.
While some might have been hoping for the Roadster announcement or a lower price point, we believe this is a step in the right direction and any knee-jerk reaction should present a buying opportunity to get into Tesla’s autonomous path forward.
We maintain our OUTPERFORM rating and our $600 price target.”
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