Driverless Cars Take the Fast Lane

January 8, 2026

AI Summary

5 min read

🎙️ The Voices & The Context

The Format: A structured expert chat between two Morgan Stanley analysts, blending analysis, predictions, and Q&A on autonomous vehicles.
The Key Players:
- Brian Noak: Morgan Stanley's Head of U.S. Internet Research, leading the discussion on AV expansion, safety, and market models.
- Andrew Prococo: Head of North America Autos and Shared Mobility Research, focusing on costs, Tesla's advantages, and rideshare impacts; strong chemistry through back-and-forth insights and shared optimism.
The Vibe: Educational and optimistic, with a professional, forward-looking energy on tech breakthroughs.

🗝️ Key Themes & Topics

The episode centers on 2026 as an inflection point for autonomous vehicles (AVs), covering expansion, challenges, and industry ripple effects. Four main topics emerge: AV rollout predictions, key growth drivers, Tesla-Waymo competition, and rideshare implications.

Topic 1: 2026 AV Expansion. Hosts predict AV availability doubling to over 30% of U.S. urban population by year-end 2026, with Waymo, Tesla, and Zoox entering new cities like Washington D.C. (first snow testing) and scaling fleets.
Topic 2: Growth Drivers. Regulatory approvals (state-by-state), superior safety vs. humans, fleet scaling, and cost reductions form a "flywheel" for robo-taxis.
**Topic 3: Tesla vs. Waymo

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What you'll learn

1 (00:00) **2026 as Inflection Point for Autonomous Vehicles**
2 (01:18) **Expected 2026 City Rollouts and Players**
3 (02:23) **Key Drivers for AV Growth**
4 (03:56) **Tesla's Cost Advantage vs. Waymo**
5 (05:14) **Tesla Safety Improvements and Scaling**
6 (06:35) **Impact on Rideshare Industry**
7 (08:03) **Long-Term AV Market Potential**

+ Full timestamped outline available in the app

Show Notes

Our Head of U.S. Internet Research Brian Nowak and Andrew Percoco, Head of North America Autos and Shared Mobility Research, discuss why adoption of autonomous vehicles is likely to gain traction this year.

Read more insights from Morgan Stanley.

----- Transcript -----

Brian Nowak: Welcome to Thoughts on the Market. I'm Brian Nowak, Morgan Stanley's Head of U.S. Internet Research.

Andrew Percoco: And I'm Andrew Percoco, Head of North America Autos and Shared Mobility Research.

Brian Nowak: Today we're going to talk about why we think 2026 could be a game changer and a point of inflection for autonomous vehicles and autonomous driving.

It's Thursday, January 8th at 10am in New York.

So, Andrew, let's get started. Have you ridden an autonomous car before?

Andrew Percoco: Yeah, absolutely. Took a few in L.A., took one in San Francisco not too long ago. Pretty seamless and interesting experience to say the least.

Brian Nowak: Any accidents or awkward left turns? Or did you feel pretty comfortable the whole time?

Andrew Percoco: No, I felt pretty comfortable the whole time. No edge cases, no issues. So, all five star reviews for me.

Brian Nowak: Andrew, we think your answer is going to be a lot more common as we go throughout 2026. As autonomous availability scales throughout more and more cities. Things are changing quickly. And we kind of look at our model on a city-by-city basis. We think that overall availability for autonomous driving in the U.S. is going to go from about 15 percent of the urban population at the end of 2025 to over 30 percent of the urban population by year end 2026.

Andrew Percoco: Yeah, totally agree. Brian, I'm just curious. Like maybe layout for us, you know, what you're expecting for 2026 in more detail in terms of city rollouts, players involved and what we should be watching for throughout the next, you know, nine to 12 months.

Brian Nowak: We have multiple new cities across the United States where we expect Waymo, Tesla, Zoox, and others to expand their fleet, expand autonomous driving availability, and ultimately make the product a lot more available and commonplace for people. There are also new potential edge cases that we think we're going to see.

We're going to have our first snow cities with Waymo expected to launch in Washington, D.C.; potentially in Colorado, potentially in Michigan. So, we could have proof of concept that autonomous driving can also work in snow throughout [20]26 and into 2027 as well. So, in all, we think as we sit here at the start of [20]26, one year from now, there's going to be a lot more people who