Editor’s note: Elon Musk burst on the political scene Saturday at a Trump rally in Butler, Pennsylvania.
Memes of the world’s richest man jumping with joy, hands in the air, as he joined Trump on stage have clogged the internet.
But the really big move from Musk this week has nothing to do with politics.
On Thursday, he’s hosting an event at Tesla called “We Robot.” And it holds the key to what’s shaping up to be the next big trend in tech.
Musk will lift the lid off Tesla’s push into self-driving ride-shares – including a prototype of a Tesla “robotaxi” called the Cybercab.
And according to colleague and tech investing expert Luke Lango it will be a massive catalyst, speeding the rollout of self-driving “robotaxis” across America.
Maybe that excites you. Maybe it terrifies you. Maybe you’re still skeptical.
Either way, you can’t afford to be in the dark on this important development. That’s why, in today’s Freeport Navigator, we caught up with Luke on why 2025 will be a pivotal year for autonomous vehicles… and how you can profit as they go mainstream.
Q&A With Luke Lango
Freeport Navigator: Last month, the Fed cut rates by half a point. You were out with a bullish call for tech stocks ahead of the cut. What made you so bullish?
Luke Lango: The Fed did more than just slash rates. It also updated its summary of economic projections. This called for continued, consistent rate cuts over the next two years.
This is very bullish…
Before the cut, the stock market was within 2% of its all-time high. Every time the Fed has cut rates with the market so close to its highs, it’s been a shot in the arm for stocks. Twelve months later, stocks were higher, on average, by 15%.
It reminds me of 1998. Back then, the internet boom was in full swing. And the Fed cut rates to counter the effects of the Russian debt default and the Asian financial crisis.
From 1998 to the peak of the boom in early 2000, the tech-laden Nasdaq 100 index soared more than 300%. That was one of the best times ever to own technology stocks.
We’re due a similar “melt up,” as rate cuts strengthen the economy against the backdrop of another powerful tech boom – this time in artificial intelligence (AI).
Freeport Navigator: You’ve been issuing new tech stock recommendations across your advisories to profit from this set up. What themes are you zeroing in on?
Luke Lango: One tech trend I’m super excited about now is autonomous vehicles (AVs). I believe they’ll finally go mainstream in 2025.
I may sound crazy saying that. The joke goes that AVs have always been five years away from being five years away. But I recently moved to Phoenix, Arizona. And I now use “robotaxi” AVs instead of Ubers to get around town.
Google has an AV unit called Waymo. It’s operating autonomous ride shares here.
You open the Waymo One app on your phone. You type in where you want to go. Then you hail a car. Five minutes later, and a Jaguar I-PACE outfitted with Waymo technology shows up at your door.
There’s nobody in the driver’s seat. There’s nobody in the passenger seat.
There’s nobody in the car.
You click unlock on the app. You climb into the back seat and buckle up. There’s a screen in the console between the front seats. You click start ride. The car says, “Welcome, Luke. We hope you enjoy your ride.”
And off you go.
You can even link your music streaming account and play your favorite playlist or podcast as you glide along.
I’ve taken a bunch of autonomous rides. My wife has used them. My friends have used them. It’s always been a smooth ride.
Freeport Navigator: What about accidents? Folks may like the convenience of a driverless ride. But they may not trust a computer to get them where they’re going without something going wrong.
Luke Lango: Waymo’s robotaxis have traveled more than a million miles with only two accidents. Neither was severe. I consider that pretty safe. Especially when you think about the alternative.
Look around you next time you’re driving. You’ll see lots of other drivers texting while behind the wheel. Humans also get tired and drop off to sleep while driving. They also have heart attacks and strokes.
AVs don’t have those issues. That’s a huge advantage.
Freeport Navigator: I’m sure it’s cool to take an AV to your favorite restaurant. But it can’t be that much better than a regular ride with Uber or Lyft. What’s going to keep folks going back to Waymo after the novelty wears off?
Luke Lango: One word – cost. I flew into Sky Harbor airport here in Phoenix. I was about to order an Uber to take me home for $45. Then I checked Waymo One, and the same ride was $26. So, I hailed a Waymo.
That value proposition will keep me and tens of millions of other Americans going back to robotaxi. Who doesn’t want to save $20, $30, $40 a ride?
Freeport Navigator: Where else can you get a Waymo robotaxi?
Luke Lango: By January 2025, they’ll be available in Phoenix, San Francisco, Los Angeles, Austin, and Atlanta.
After that, I expect Waymo to launch one to two new cities almost every month. So, by the end of next year, we’re talking two dozen – maybe three dozen – cities that have at least some Waymo capability.
And that’s just one part of the story…
On the Interstate a company called Aurora is doing autonomous trucking. In Texas, its self-driving semis are taking goods from one city to the other
And this Thursday, the world’s richest man, Elon Musk, is holding his We Robot event. It will showcase Tesla’s robotaxi plans. Musk is expected to unveil Tesla’s robotaxi prototype, the Cybercab.
Musk is also taking advantage of Tesla’s full self-driving software to turn Model 3, Y, and X Teslas into robotaxis. Folks will be able to buy a Tesla and get paid for having it pick up passengers in full self-driving mode when they’re not using it.
This is the world we are sprinting into.
Next year is going to be a huge year for the industry… and for stocks in companies powering this trend.
Freeport Navigator: What are some of the ways Freeport Navigator readers can get exposure to this trend?
Luke Lango: The most obvious play is Google parent company Alphabet (GOOG).
It’s trading at about 19x forward earnings. In other words, you’re paying $19 for every $1 it’s expected to make over the next 12 months.
That makes sense based on Google’s core business of advertising, search, and cloud businesses alone. So, you’re getting Waymo for free.
And if it starts to add billions of dollars in revenue – and hundreds of millions of dollars in profits – Alphabet’s share price could double.
Another way to go is Tesla (TSLA). It’s launching its robotaxi concept this week. But Wall Street is still valuing its stock based just off its electric vehicle business.
Tesla is selling a lot of great electric cars and growing sales. That’s nice. But if you throw its autonomy software and a potential robotaxi network, it’s no longer just a car company. It’s something much, much bigger.
Elon wants you to buy a Tesla and drive it. Then, when you’re not driving it, it can drive itself as part of the robotaxi network. And you share in the income your car generates.
Waymo is shuttling people out of making income. All of it goes to Alphabet. But with Tesla, you get a share of the revenue. If that happens, a lot more people are going to buy one of Elon’s electric cars.
I see huge upside value for Tesla – both in terms of robotaxi revenues and increased demand for its cars.
Another pure play is the autonomous trucking company I mentioned, Aurora (AUR). It’s the leader almost without competition in autonomous trucking.
Waymo is going after autonomous ride sharing networks.
Tesla is going after autonomous cars for individuals.
And Aurora is going after autonomous trucking.
Those are the three legs of the AV revolution. And now is a great time to buy. You have this convergence of major catalysts next year with rate cuts and self-driving going mainstream.
It’s why I went live this morning at 10 am Eastern with a strategy session all about how to profit from the AV revolution. And as I showed folks who joined me online for it, this could be the last opportunity to buy low.
Tesla has been working on autonomy for a decade. This is going to be the moment where all that works comes to fruition.
Elon’s announcement this week is going to be big.
And it’s going to be shocking.
Elon is nothing if not a showman. With his backing – and with Google also racing to rollout its robotaxi service across America – you’re going to hear a lot about this trend next year. And I want folks to get in before the mainstream latches on.
During this morning’s strategy session, Luke showed folks how he sees this revolution playing out – including the sectors most at risk for complete disruption…
Which companies will be the key players…
And even details on a small-cap tech stock linked to Tesla whose technology could go gangbusters become the cornerstone of this new era of transportation.
BlackRock… billionaire David Shaw… and Citadel, which is the most successful hedge fund of all time… are heavily invested in this company already.
And billionaire venture capitalist Peter Thiel invested in this company when it was just getting started.
But it’s very important that you buy shares before Elon Musk’s Robotaxi event scheduled for this coming Thursday night.
So, if you missed it this morning, make sure to catch the free replay here now.