Is Tesla about to become the ultimate passive income machine?

Tesla (NASDAQ: TSLA) and passive income aren’t usually uttered in the same breath. That’s because the stock has never paid a dividend, and isn’t likely to while the EV pioneer continues to invest aggressively in futuristic technologies.

Yet a chunk of the company’s market value might be tied in some ways to the notion of passive income. Specifically, Tesla owners sending their vehicles out into a fully autonomous robotaxi network to earn them money while they sleep, work, or sit on a beach sipping something with a tiny umbrella in it.

The vision is undeniably bold: when you’re not using your Tesla equipped with Full Self-Driving (FSD) software, it can drive itself out into the world and pick up fares. Owners would get a cut, making a car a money-generating asset instead of just a depreciating one.

In other words, passive income on wheels. The plan also involves a fleet of custom-made robotaxis (called Cybercabs) that won’t have pedals or steering wheels.

According to CEO Elon Musk, this long-awaited robotaxi network is finally set for a pilot launch in Austin, Texas, in June. He predicts this, along with millions of Optimus humanoid robots, will create the world’s most valuable company.

If we do execute well…I think Tesla will be the most valuable company in the world by far. It may be as valuable as the next five companies combined.

Elon Musk, Q1 2025 earnings call.

A few Wall Street analysts agree and see this as a multi-trillion dollar opportunity.

Given this massive potential then — and the fact that Tesla stock is down 45% since December — should I invest? Let’s find out.

Robotaxis already exist

It may come as a surprise to some that driverless taxis already exist in some US cities (Austin, Los Angeles, Phoenix, and San Francisco). My Uber driver last week didn’t know this.

The company behind these, Waymo, is owned by Alphabet. And it’s now safely doing over 250,000 fully autonomous paid rides per week. It plans to launch in Atlanta in the summer, then Washington and Miami in 2026.

The difference between Waymo and Tesla lies in the technology each is using and its potential scalability. Waymo relies on lidar and pre-mapped routes, while Tesla uses a vision-based system powered by AI, which could scale more easily but also carries far more complexity/risk.

Should I buy Tesla stock?

Right now, Tesla’s core EV business is facing a lot of well-documented challenges. These range from falling sales, shrinking profit margins, fierce competition, and brand damage from Elon Musk’s outspoken political views.

Plus, while the Optimus bots are chipping in with a bit of work around the Tesla car factories, many challenges remain before they will be commercially ready. Meanwhile, the energy storge business is growing really well, but remains a smaller part of the whole.

For me then, an investment in Tesla now simply boils down to robotaxis. But whether the technology is ready for large-scale deployment yet is still unknown. With the stock trading at a sky-high 142 times earnings, I see no margin of safety.

What about people earning passive income from their Teslas in the UK? Well, that is likely to be many years away, if ever. Regulators are yet to be convinced about the safety of the technology.

The post Is Tesla about to become the ultimate passive income machine? appeared first on The Motley Fool UK.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Ben McPoland has positions in Uber Technologies. The Motley Fool UK has recommended Alphabet, Tesla, and Uber Technologies. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.