Tesla Revenues to Exceed GM and Ford Combined by 2027, Says Morgan Stanley

Legacy automakers like Ford and General Motors (GM) are scrambling to deliver their first electric vehicles (EVs), and one analyst says Tesla is uniquely poised to overtake them both within the next five years.

Morgan Stanley analyst Adam Jonas shared a new note on Wednesday saying he expects Tesla’s revenues to surpass those of Ford and GM combined, citing increasing market share (via @Sawyer Merritt).

In the note, Jonas wrote, “Most auto investors we speak still struggle with the idea that Tesla could ever be bigger than either GM or Ford. We expect Tesla revenues to be larger than GM + Ford (combined) by 2027.” Jonas added, “The zero-sum game is hard to see today… should become obvious over the next 24 months.”

Jonas also noted that Tesla’s U.S. market share was 4 percent on its auto sales, up 63 percent year over year — despite supply shortages and an economic downturn that led to the broader market dropping 10 percent year over year.

In addition, he estimates that Tesla’s average transaction price (ATP) is currently around $60,000 USD, landing 30 percent above the U.S. average ATP on other stocks.

Jonas currently has an Overweight rating on the stock with a price target of $1,300.

A handful of other analysts raised their price targets on Tesla last month, citing the company’s impressive Q4 and overall 2021 deliveries.