In internet terms, a debate has been raging for entire epochs about whether Tesla Motors (NASDAQ: TSLA) ought to be regarded as a technology firm or a car company.
Indeed, for years, the fans of Tesla and its billionaire CEO have been arguing that the electric vehicle (EV) maker is far ahead technologically than other firms, while the bearish netizens and analysts have been calling its big-tech-like valuation unreasonable.
Elon Musk himself recently opined that his car manufacturer should not only be considered a technology company and not a regular vehicle maker but that it is indeed an artificial intelligence (AI) firm. The reaction to the statement has, so far, been mixed.
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It is also worth remembering that Musk has a vested interest in Tesla being regarded as a technology firm, given that more than half of his wealth is tied to TSLA stock.
Additionally – at least when it comes to the current version – Mercedes (ETR: MBG) actually beat Tesla to the punch with self-driving technology.
Old and new Tesla smartphone rumors and predictions
Nonetheless, recent rumors appear to be reinforcing the notion that Tesla is more than a car maker.
The banking giant Morgan Stanley (NYSE: MS) recently reportedly sent out a note indicating Elon Musk’s company is working on a smartphone with a statement that sounds like something straight out of a book on techno-mysticism:
‘The car is an extension of the phone. The phone is an extension of the car.’
Rumors that Tesla is working on a smartphone have been waxing and waning over the years, with some predictions assuming Starlink satellite connectivity, solar charging, Neuralink integration, advanced camera systems, and many others.
Simultaneously, they have been kept in check to an extent by Musk himself, who at times expressed doubts about whether smartphones have a future given the work on technologies such as the aforementioned Neuralink.
In fact, during a live stream in the evening of June 9 – several days before initial reports of the Morgan Stanley note – Musk again refuted the smartphone rumor. He did, however, state that an X phone is ‘not out of the question.’
Nonetheless, with the most recent batch emerging from an entity as prominent as Morgan Stanley, Finbold elected to consult another technological marvel – ChatGPT-4o – the most advanced model of OpenAI’s flagship AI platform on what a Tesla smartphone might mean for TSLA stock.
ChatGPT-4o sets TSLA stock price at Tesla smartphone launch
In its analysis of the potential impact of a Tesla smartphone on TSLA share price, ChatGPT identified three crucial areas for consideration.
The AI believes that any Tesla smartphone is likely to offer significant integration with the firm’s existing products, which would likely bolster the value of the company’s offerings across the board.
In terms of market penetration, ChatGPT considers that Tesla has pretty good odds of making a splash thanks to its reputation for innovation and strong brand loyalty.
FInally, the AI explained that the creation of a successful smartphone would help Tesla diversify its offerings and help expand its avenues for growth.
Based on these factors and a string of assumptions – such as that the phone would offer better profit margins than the cars and that the company’s P/E ratio ought to be adjusted to 75 should Tesla launch a smartphone – ChatGPT concluded that a launch of the phone could single-handedly send TSLA market cap to $656.25 billion and share price to $207.25.
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