Uber Technologies (UBER) and Lyft (LYFT) are facing disruption "slowly, then all at once," as Tesla (TSLA) reportedly seeks to expand its robotaxi services to Arizona, Wedbush Securities said in a note Friday.
The firm noted that Tesla, which recently launched robotaxi services in Austin, has reportedly applied to test and operate robotaxis Arizona while waiting for approval in the Bay Area, with the regulatory agencies expected to decide by end of July in Arizona and within the next month or two in the Bay Area.
Wedbush reiterated that Uber and Lyft are expected to face disruption from the autonomous vehicles of Tesla and Alphabet's (GOOG, GOOGL) Waymo over time, even though the near-term financial impact of robotaxis will be limited.
"Success for Tesla and Robotaxi would be most disruptive for Uber/Lyft, as it will likely walk alone from a distribution standpoint," Wedbush analysts said in the note. "While Uber has done a great job of positioning itself as a beneficiary of Waymo expansion, we believe this perceived benefit may flip once the distribution need for the 'autonomous on training wheels' phase of development is complete."
Wedbush has a neutral rating on Uber and Lyft stocks, with price targets of $85 and $16, respectively.
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