Tesla $TSLA ( ▲ 1.83% ) could unlock tens of billions of dollars in additional value by expanding into solar panel manufacturing, according to a new note from Morgan Stanley. The bank estimates the move could add between $25 billion and $50 billion to Tesla’s energy business alone.
That is meaningful even for a company with a market cap north of $1 trillion, especially as Tesla looks to build out the infrastructure behind its broader AI and energy ambitions.
Building Power for Its Own AI Future
Morgan Stanley believes Tesla $TSLA is not trying to flood the global solar market or go head to head with established panel makers like First Solar $FSLR. Instead, the strategy appears more focused on vertical integration, using solar panels internally to power its expanding energy storage and data center needs.
By producing its own panels, Tesla could reduce supply chain risks and better control energy inputs as its power demands grow. That includes supporting energy intensive projects tied to AI compute and even future space based infrastructure.
A Big Bet With a Big Price Tag
The opportunity does not come cheap. Morgan Stanley estimates Tesla’s solar manufacturing push could cost between $30 billion and $70 billion. Notably, that figure is separate from the company’s already announced capex plans of more than $20 billion this year.
Still, the bank argues the long term value of combining solar generation with Tesla’s energy storage business could justify the heavy spending.
Energy Becomes a Bigger Piece of the Puzzle
Morgan Stanley currently values Tesla’s energy segment at around $140 billion. Adding as much as $50 billion in value through solar manufacturing would meaningfully boost that figure, even if it remains smaller than the trillion dollar opportunities some analysts see in Tesla’s AI and autonomy efforts.
For Tesla $TSLA, the move signals that energy is not just a side business. It is becoming a core pillar of how the company plans to power its next phase of growth.