Tesla Inc.'s stock surged 5.05% in Friday's trading session, as investors cheered the company's plans to launch an autonomous ride-sharing service and a more affordable electric vehicle model in the coming months.

Despite a challenging start to 2025, with Tesla reporting its first annual decline in deliveries and slashing prices to boost demand, CEO Elon Musk outlined several catalysts that reignited optimism among investors. Musk confirmed that Tesla is on track to launch its robotaxi service in Austin, Texas, in June 2025, marking a significant step towards autonomous driving and potential new revenue streams.

Furthermore, the company plans to introduce a cheaper electric vehicle model in the first half of 2025, expected to cost less than $30,000 after tax credits. This move aims to expand Tesla's market reach and compete with the growing popularity of Chinese EV brands.

While Tesla faced headwinds in the European market, with sales plummeting 45% year-over-year in January, the company's long-term prospects remain promising. Analysts anticipate Tesla's earnings to grow at an annual rate of 24% through 2026, driven by the rollout of new products and the potential success of its autonomous driving and robotics initiatives.