Tesla and the $9 Trillion Sky: Could eVTOL Be Its Next Frontier?

Tesla may soon find itself taking flight—literally.

According to Morgan Stanley, the EV giant is well-positioned to enter the drone and electric vertical takeoff and landing (eVTOL) market, part of what the firm calls the “Low Altitude Economy,” a space projected to hit a staggering $9 trillion in total addressable market (TAM) by 2050.

Strategic Potential in the Air

Following a Ukrainian drone offensive on Russian air bases, Morgan Stanley described the event as a “wake-up call” to the strategic role of unmanned aerial systems in modern warfare. The bank's analysts argue that AI, autonomy, and drone manufacturing will define future conflicts—and Tesla is already equipped with the critical building blocks.

While Tesla has not formally disclosed any plans in aviation or drone tech, Morgan Stanley cited the company's competitive advantages in:

• Battery technology and storage

• Navigation and AI-based autonomy

• Advanced robotics and scalable manufacturing

These capabilities position Tesla to be a future player in the eVTOL race—both commercially and, potentially, for defense purposes.

Elon Musk's Drone Warning

During Tesla's recent Q1 earnings call, CEO Elon Musk underlined the geopolitical importance of drone capabilities:

“Any country that cannot manufacture its own drones is doomed to be the vassal state of any country that can.”

He added that the U.S. currently lacks the domestic capacity to manufacture drones at scale—a vulnerability Tesla may aim to address.

What This Means for Tesla's Valuation

Morgan Stanley projects a wide valuation impact based on Tesla's potential eVTOL involvement:

• Low-end scenario: Adds $100 per share

• High-end scenario: Could add $1,000 or more per share

This upside makes aerospace a wildcard catalyst for Tesla's long-term stock trajectory, particularly as traditional auto growth begins to plateau.

Monitoring the Momentum

Investors tracking Tesla's expansion into new sectors may find value in monitoring:

• Price Target Summary API — for updated analyst sentiment on Tesla's valuation.

• Owner Earnings API — to gauge Tesla's cash-generating ability as it funds ambitious ventures like eVTOL or robotics.

As the line between auto manufacturing and aerospace continues to blur, Tesla's next big breakthrough might not be on four wheels—but in the sky.