- Ron Baron urges investors to buy Tesla stock as soon as possible.
- 55% of new buyers are choosing to purchase Tesla with Full Self-Driving.
- Baron sees the spread of FSD as a key factor in Tesla's value growth.
- Baron's support for Elon Musk demonstrates his loyalty to Tesla.
In a new interview on Wednesday, Tesla bull Ron Baron said anyone hoping to buy shares in the company should move quickly. Baron, the founder and chief executive of Baron Capital and one of Tesla's most steadfast institutional investors, delivered his familiar message on CNBC's Squawk Box, infused with a fresh sense of urgency: in his view, Tesla stock is a buy. "Now is the time to buy the stock. Full Self-Driving (FSD) is gaining traction and will become even more widespread in the future.
The impact of Full Self-Driving
55% of new buyers are purchasing Teslas with FSD. This will spread everywhere, and it will be safer." The Baron Capital chief executive built his case around Full Self-Driving.
Tesla reported 1.48 million active FSD subscriptions in the second quarter, up 56% from a year earlier, and company officials said roughly 55% of new North American deliveries had the subscription enabled. Baron views this attach rate as evidence that the product is shifting from an enthusiast add-on to an expected standard, and sees it as the driver of the next leg of value — not just an increase in vehicle volumes. His confidence in Tesla shares is not theoretical, since Baron Capital first invested in Tesla in 2014, after years of meetings that began with the initial public offering roadshow in 2010.
The firm later began building a large SpaceX position in 2017.
Baron's support for Elon Musk
Baron said those Musk-led investments have generated roughly $30 billion of profit on $71 billion for Baron Capital's clients. He estimated the firm's current SpaceX holding at about $25 billion and its Tesla holding at about $5 billion. For his own account, he described SpaceX as his largest position at about $5 billion, with Tesla at about $1.5 billion, while adding to Tesla through the firm's funds.
That concentrated exposure also speaks to his loyalty. Asked about discussions around a SpaceX–Tesla combination, Baron said he had laid out the arguments for and against such a deal in detail to Elon Musk, but declined to repeat them on the show. His public stance was simpler: "Whatever you decide, I'll support it," he told Elon Musk.
Baron also said he bought a farewell edition of the Model S after Tesla decided to discontinue it earlier this year, calling it his favorite car to drive.
How Full Self-Driving is reshaping the market
The spread of Full Self-Driving technology is central to Tesla's future, since it not only boosts the appeal of the vehicles but also shifts the buying decisions of consumers. Ron Baron's view reflects market confidence in the technology and signals the long-term commitment of institutional investors to Tesla. As more vehicles ship with FSD, Tesla's market position is likely to strengthen further, which could draw additional attention to the electric-vehicle maker from investors.