China’s lower tech costs poised to accelerate global robotaxi market: Morgan Stanley

Morgan Stanley says the global robotaxi market could reach US$1 trillion by 2040, driven by rapid advances in AI, clearer regulation and sharply lower Chinese hardware costs. The bank expects Chinese-made robotaxi parts to fall to US$35,000-US$40,000 per vehicle in 2027, helping services cover operating costs by 2028 and enabling scaled commercial deployment by 2030. It highlights China-based players such as Baidu, Xpeng, WeRide and Pony.ai as regional leaders, while Tesla and Waymo are seen as global bellwethers. The report implies a major structural growth opportunity across autonomous mobility, with the fleet model shifting toward distributed networks and robotaxis potentially reaching 2.5 million units by 2035. The overall tone is positive for autonomous-driving companies and their supply chains, especially in China, because falling costs could accelerate adoption and commercialization.