Pony AI, a trailblazer in the autonomous driving space hailing from China, is poised for substantial growth in its robotaxi segment, positioning itself as a key player in the burgeoning self-driving car sector. Deutsche Bank believes in the company’s potential, with analyst Bin Wang initiating coverage with a buy rating and a target price of $20, hinting at a 33% upside. Pony AI made its entrance on the Nasdaq on November 27 following an initial public offering, and the stock has climbed a modest 6% since its debut.
Renowned for its global leadership in the large-scale commercialization of autonomous mobility, particularly robotaxis, Wang labeled Pony AI as the “Chinese Waymo,” drawing a parallel to Alphabet’s self-driving car initiative. “Pony’s intelligent-driving technology is anchored in proprietary software enriched by state-of-the-art artificial intelligence,” Wang noted in his client communication. This technological edge allowed Pony to become the sole robotaxi firm with all necessary regulatory permits in China’s tier-1 cities.
Pony AI operates fully autonomous, fare-charging robotaxis across China’s four premier cities: Beijing, Shanghai, Guangzhou, and Shenzhen, which are among the most developed and affluent regions in the country. Additionally, the company is conducting road tests for its robotaxis in Shanghai. Wang foresees a booming future for both Pony’s robotaxi and robotruck operations, expecting them to become profitable before the decade wraps up. Over the last three years, Pony’s revenue primarily stemmed from licensing and applications, but Wang believes that with the expansion and commercialization of its fleet, robotics leadership in China will further bolster the company’s growth.
China’s rapidly scaling robotaxi fleet is already a testament to the explosive potential of this sector, as more commuters flock to ride-hailing platforms featuring robotaxis, including Pony’s own PonyPilot app. Wang predicts governmental support for robotaxis will intensify, with increased operational areas and licenses paving the way for broader adoption. Looking towards the future, Deutsche Bank anticipates Pony’s robotaxi and robotruck ventures to significantly contribute to the company’s earnings, comprising about 58% of the total revenue in 2024 and soaring to an estimated 97% by 2030. Specifically, Pony’s robotaxi services are expected to witness a staggering 171% compound annual growth rate, escalating from $8.6 million in 2024 to a phenomenal $3.37 billion by 2030, capturing approximately 93% of the company’s total revenue.
