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Why Gene Munster Says Tesla Autopilot Safety Concerns Are Unfounded

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Why Gene Munster Says Tesla Autopilot Safety Concerns Are Unfounded

Tesla Inc’s (NASDAQ: TSLA) vehicles are safer with Autopilot despite the recent crashes that have put the technology under intense scrutiny, Loup Ventures managing partner Gene Munster said in a report on Monday.

What Happened: The National Highway Traffic Safety Administration, the U.S. auto safety agency, last week launched a new Special Crash Investigation (SCI) team to probe a “violent crash” involving a Tesla vehicle. 

In his report, Munster presents the case that despite the intense regulatory scrutiny and criticism around the crashes, the Autopilot technology makes those vehicles much safer. Though still in its early stages of development, the Autopilot technology has the potential to significantly lower vehicle fatalities in the coming decade. 

It’s not clear however if the Autopilot was deployed in the Detroit incident. 

“As with most transformative tech, there is naturally regulatory concern when failures happen. And given Tesla is the leader in the autonomous vehicle space, they are under a finer microscope,” Munster wrote in a note.

See Also: Why Tesla's Charging Stations Are A Key Advantage For Its Future

“Autonomous systems will drastically reduce the number of vehicle fatalities, similar as seatbelts did in the ’70s but on a greater scale.”

Tesla reports one accident for every 3.7 million miles driven while Autopilot is engaged. Over the past two years, the number of miles driven per accident, with the Autopilot on, has increased 18%. Compared to that, the NHTSA reports one accident for about every 475,000 miles driven for all US vehicles.

Why It Matters: Tesla has been voluntarily reporting accident data since the third quarter of 2018 and according to Munster, with more data, the Autopilot technology is improving over time.

“Driven by algorithms, the more data Tesla vehicles collect the better its ADAS gets. We estimate the US Tesla fleet has grown from around 150,000 in 2017 to 750,000 today, equating to 5x more data,” Munster wrote.

NHTSA has previously launched around at least 14 SCI teams to investigate Tesla crashes that may be tied to the vehicle’s advanced Autopilot driver assistance system, but taken no action against the automaker as a result of those probes.

Price Action: Tesla shares closed 2.3% up at $670 on Monday.

Latest Ratings for TSLA

DateFirmActionFromTo
Jun 2021Canaccord GenuityMaintainsBuy
May 2021Wells FargoInitiates Coverage OnEqual-Weight
Apr 2021Canaccord GenuityMaintainsBuy

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SPFRLake StreetInitiates Coverage On13.0
SHSPLake StreetDowngrades
RDS/ASociete GeneraleUpgrades
JRSHAegis CapitalMaintains9.0
TSMArgus ResearchInitiates Coverage On150.0
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