Global robotaxi market set to hit US$1T by 2040 as China tech costs plummet (www.scmp.com)

Morgan Stanley has revealed that the global robotaxi market is poised to reach US$1 trillion by 2040, largely due to plummeting tech costs in China. Key players such as Baidu, Xpeng, and WeRide are expected to emerge as regional leaders alongside Tesla and Waymo. The report notes that by 2027, the cost of parts for Chinese-made robotaxis is projected to drop to between US$35,000 and US$40,000, which will significantly lower the barriers for mass adoption and accelerate market growth. The anticipated decrease in manufacturing costs is seen as a "major underappreciated accelerant" for the robotaxi industry. Coupled with advancements in artificial intelligence and clearer regulatory frameworks, these cost reductions are expected to enable robotaxi services to cover operating expenses by 2028, leading to large-scale commercial operations by 2030. While the U.S. and China currently dominate the landscape, the report suggests that Europe and other regions in Asia could gain significance as the market evolves. This shift underscores the increasing importance of cost-effective AI technologies in the transportation sector.