Morgan Stanley: Manufacturing is Tesla's moat

As the AI field gradually moves into the physical world, Tesla's manufacturing strength is expected to become a core advantage.

Morgan Stanley analyst Adam Jonas's team summarized in a recent report that Tesla's core competitiveness can be encapsulated in the six elements of DREAMS, which are: Data, Robotics, Energy, AI, Manufacturing, and Space.

Among them, Morgan Stanley pointed out that Manufacturing will be Tesla's most critical moat, especially in the field of embodied intelligence, where hardware production capability and scalable manufacturing are core barriers.

"In the physical AI race, data defines software, software defines hardware, hardware defines manufacturing, and manufacturing is the moat."

The report further explains that ordinary unconnected devices can be manufactured and sold anywhere, but agentic robots cannot be produced just anywhere. Especially against the backdrop of the continuous decline of American manufacturing over the past 80 years, Tesla's manufacturing advantage has become particularly valuable.

Therefore, this manufacturing capability enables Tesla to turn its AI robot vision into reality, which is a core competitiveness that other competitors find difficult to replicate quickly.

Tesla may build a "bridge" for Chinese electric vehicle manufacturers

The report also stated that China has already gained a technological advantage in the electric vehicle sector, and entering the market through local production in the U.S. may just be a matter of time.

The report further pointed out that Tesla is likely to become the "bridge" to help Chinese electric vehicle manufacturers enter the U.S. market:

"We believe that the most likely automaker to help Chinese electric vehicle manufacturers enter the U.S. is Tesla."

"If Tesla doesn't do it, others will. As the market share of electric vehicles in the U.S. grows, the AI 'excuses' that Tesla can fill will also increase."