Uber poised to lead autonomous ride-hailing market growth

Ark Investment Management believes the autonomous ride-hailing industry could be worth $14 trillion by 2027. While Tesla is a major player with its Cybercab robotaxi, Uber may actually be better positioned to dominate this market. Uber currently runs the largest ride-hailing platform globally. It has the necessary infrastructure to support the growth of self-driving cars. Although Tesla aims to create its own ride-hailing network, Uber already serves over 171 million users each month. This gives Uber a significant edge in managing trips and balancing supply and demand. Financially, the introduction of autonomous vehicles could greatly benefit Uber. The company spent $72.5 billion on human drivers last year, a significant part of its $162.7 billion in gross bookings. By switching to autonomous rides, Uber could increase its revenue and profit margins. Uber is also actively partnering with various manufacturers to develop autonomous technologies. It has signed contracts with over a dozen companies, including Waymo, which is already providing paid rides in multiple major cities. Uber’s partnership with Nvidia is another strategic move. This collaboration will help speed up the development and commercialization of autonomous vehicles. In terms of stock valuation, Uber appears more attractive compared to Tesla. Uber's earnings per share (EPS) rose significantly last year, and its price-to-earnings (P/E) ratio is much lower than Tesla’s. While Uber had a one-time tax benefit that inflated its EPS, it still represents a better value than Tesla. Overall, as the autonomous ride-hailing industry grows, Uber may be an excellent investment opportunity at its current stock price.