Are Robotaxis Coming to a City Near You?

In this episode of Motley Fool Money, Motley Fool contributors Jon Quast, Matt Frankel, and Jason Hall discuss:

• QXO’s $17 billion acquisition of TopBuild.
• Tesla’s Robotaxi expansion.
• Mailbag: Did I make a mistake by selling a stock that went up?

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A full transcript is below.

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This podcast was recorded on April 20, 2026.

Jon Quast: Are robotaxis coming to a city near you? This is Motley Fool Money. Welcome to Motley Fool Money with the Hidden Gems team. I'm Jon Quast, and I'm joined today by Fool contributors Matt Frankel, and filling in for us this week is Jason Hall. We're going to talk about Tesla. We're going to answer questions from our Mailbag about selling stocks.

But first, we want to hit this multibillion-dollar lead story, and that's a QXO is acquiring TopBuild for a reported $17 billion. QXO is primarily a roofing business. What was so interesting to me is its market cap only about 18 billion. Probably better to call this more of a merger than an acquisition, but this isn't even the first acquisition it's made this month, earlier this month, announcing it's acquiring Kodiak Building Partners for $2.25 billion. This is just wow.

Jason Hall: Jon, no, this is an acquisition. Let's make no bones about that whatsoever. For those that haven't followed the QXO story, this is really, and I'm a shareholder here, and the reason I'm a shareholder is I want to invest along with CEO Brad Jacobs. This is one of the greatest value creators for investors in his company’s in history. He's founded something like eight different companies that reached a value of at least $1 billion. A few of those, United Waste, which was acquired, and XPO Logistics and United Rentals, which are still public, were massive winners for shareholders. With QXO, we're expecting the Jacobs playbook to work again in a different industry. The playbook is you take an industry that has dozens to hundreds of players, acquire a bunch of them at reasonable prices, consolidate them together where it makes sense, and then apply a layer of technology to those businesses to drive efficiencies and process improvements. Repeat that playbook and be very disciplined and do it for many years, and a lot of people are going to make a lot of money.

Jon Quast: Well, it certainly made the top of the headlines that I was looking for this morning, and that's why it made it onto the show. And I get it. Acquisitions are always exciting. But, Matt, there are just so many instances where a business pays too much to buy another company, and it winds up destroying long-term shareholder value. I don't know. Does this QXO deal for TopBuild make sense to you?

Matt Frankel: Jason mentioned Brad Jacobs has a great history of value-added acquisitions, paying the right price, and adding value afterwards. The deal does make QXO the second-largest publicly traded buildings product developer in North America. This is QXO's largest deal by a mile. It's bigger than all of its previous acquisitions combined. We're really betting on the Brad Jacobs playbook to work here. But I do like this one for QXO. TopBuild, they have very solid margins. It's trading for a reasonable valuation, considering its growth and recent results, even after the acquisition premium. I think there are going to be a lot of synergy opportunities between the companies. Jason knows it better than me, but I think this looks like all the makings of an accretive acquisition right off the bat.

Jason Hall: Yeah, I think that's right. TopBuild, I followed it for a while, and they're an excellent, excellent operator. Our good friend Lou Whiteman and I were in a text group, and we've been chatting a little bit about this. He really stressed that. Lou is maybe the biggest Brad Jacobs fan of anybody at The Fool. He's followed him and invested with him for a long time, and finding maybe an even better operator than Jacobs is pretty special.

The other thing, though, is that TopBuild is in a niche, but pretty big industry in the installation distribution business, but they also have a big installation business, as well. You take that, you combine it with XBO's access to capital. That's why this deals happening because there's a lot of money out there that wants to go along with Brad Jacobs. That could be some secret sauce here. Giving TopBuild paired with Jacobs more firepower to expand into more markets, both organically and through other acquisitions, Matt's absolutely right. This is by far the biggest deal that Jacobs has made at QXO, but it's now a player in multiple parts of the building distribution industry.

Before, its biggest business was roofing products. The Kodiak deal got it into lumber and building materials. Now it's in insulation. I expect we're going to see further expansion into other segments of the construction and building products distribution industry. It's an $800 billion industry. Again, I'm a shareholder because Jacobs does this. He does this incredibly well and doesn't just build empires. He builds value for shareholders. We're going to see a very fragmented industry get consolidated more.

There's so much opportunity to do these deals. Everybody was expecting another roofing business because that looked like that was where he was going to start. I think this caught a lot of people off guard, and it's a reminder that the goal is just to take this fragmented industry and consolidate it in ways that makes sense. Now you get to cross-sell, you get to combine customers across these businesses. There's a lot of ways that Jacobs can create value here.

Jon Quast: Is this one of those businesses that does better in a hotter real estate market, or is it just one of those tried and true, it doesn't really matter what the real estate market is doing?

Jason Hall: It's going to be a little bit like, Matt, you'll love this. It's going to be a little bit like investment banks in a way that nothing's always working great. Parts of it do great when the economy and the market's going hot. Other parts, when there's a lot of struggle. You think about the roofing products business, for example, we have an aging housing stock in the U.S. There's a lot of deferred maintenance. There's opportunity there. That installation business, that's largely a bet on new home construction. That's the largest thing there, and their niche because of their doing the installation of that. It's a dirty, ugly, installation sort of business to do. Having that business is the thing that Home Builders, they're building a community. They want the whole community done. They're going to have one company that's going to come in and be the contractor and do all the installation. That's how it's going to win. Different things are going to be working better when the market's great, and other parts are going to be doing fine when the housing markets not doing great.

Jon Quast: Well, it's certainly a trophy acquisition here for this company that's been known to make acquisitions. We'll have to wait and see how competitors respond in the space that this big move, this big swing that it just took. We'll just have to monitor that in the months and years ahead. But after the break, we'll be taking a look at what is new with Tesla's robotaxis. You're listening to Motley Fool Money.

Welcome back to Motley Fool Money with the Hidden Gems team. This is quite interesting. Tesla, over the weekend, it's announcing that its robotaxis are entering into new markets. They've been operating in Austin, Texas, since June of last year. Now they're saying that they're going into Dallas and Houston. But I just have to wonder, is there anything really to care about here? Because there's some reports saying that there's only one car in each of these two new markets. It feels a little bit crazy to talk about this one. There's only one car map.

Matt Frankel: I read the reports that only one car has been registered so far in each of these markets. Of course, having a single vehicle in Dallas and Houston is not material to Tesla's business at all. So far, the robotaxi business isn't material to Tesla's business, but this is an important milestone. They're a long way away from the Cyber Cab becoming the highest production vehicle in its lineup, as Elon Musk has predicted. But the reality is that building a robotaxi service is extremely hard. Just ask GM, which is great at what they do. Tesla's doing a pretty solid job of it so far.

Jon Quast: Well, what is the case that we should pay attention to this here? Because if I'm looking at this, I'm saying Tesla's already worth over $1 trillion. It's all based pretty much on the auto business that it has right now. Shouldn't we focus on that and not this potential robotaxi business that seems really far off in the future?

Matt Frankel: Yes and no. I would first argue that the trillion-dollar valuation does have a lot of this thing baked in. It's this. They have the energy business. There's a lot in the robotics business. There's a lot that they're planning to do. But it's really tough to overstate what a big opportunity robotaxis could be. As time goes on, it's looking like there are going to be fewer and fewer big winners as companies like GM have thrown in the towel. Tesla is going to have to compete for market share, but not with a ton of companies. Auto executives have called this a multi-trillion-dollar market opportunity. I think GM was throwing around a $5 trillion figure for a while, and I think that might be pushing it. But I read an outstanding research report recently.

They made a realistic case that robotaxis are going to be $190 billion revenue opportunity 10 years from now. For context, Tesla's entire revenue in 2025 was about $95 billion. If there's not that many different major competitors, that's a big pie. Robotaxi revenue, and here's the key point, could have much higher margins than Tesla's core auto-making business, and that's really where the opportunity is. It makes sense that Tesla is investing heavily here. Don't read too much into the only-one-car narrative. As long as Tesla keeps making forward progress at a reasonable rate without any major setbacks, like their cars running over somebody, like GM had that essentially killed their business, it's good news for investors.

Jon Quast: Jason, when we talk about competition in this space, we look at the different players that are out there. Not all of these autonomous vehicles are built in the same way. There are technical differences between them. I'm just curious, do you think that Tesla, as it's looking to scale, it's saying maybe 8-10 metro areas this year, but does it have the technical expertise, the technical advantages to scale this technology?

Jason Hall: Yeah, so this may not be a popular take before I get to my take here. Let's talk about really the difference in what Tesla's doing from anybody else. That's really what it comes down to. It's sensor focus. It's mostly camera-based, optical sensor-focused. Most of the rest of the industry is using LiDAR, other technologies. Radar is pretty popular across pretty much everybody. But what we're finding is that the benefit of doing that is that it's from hardware perspective, should be substantially cheaper, even though LiDAR has gotten much, much lower cost. But I think, again, as much as Musk's had this long history of promising things are going to happen next year, they eventually happen, but it's four or five years later. I think, as much as anything, that might be promoting, but also, I think it's largely just how aggressive Musk is. Eventually, a lot of these things do happen.

But that technical approach that Tesla is taking, we're seeing the challenges of it in real time, how much longer it's taken to get outside of Austin. Is much, much longer than Musk initially promised. The decision to not use technologies like LiDAR require the software and the hardware that's doing the processing to do a lot more heavy lifting. It's clearly been the biggest challenge, I think, to scaling up autonomous taxis, compared to like Waymo, which is definitely the leader in terms of, they have like 11 markets they're in. They do a half a million paid rides a week. Now they're geofenced. They're only in very specific areas. Tesla says, look, our goal is to try to get into more places quicker over the long term. We have billions of miles of cars driving autonomously in the wild, and that data is helping inform the decisions that we're making. But the reality is, it's been a much harder process. The slow expansion of the auto taxi business for Tesla does concern me that its technical approach might be, if not a failure, certainly ends up putting it far behind other competitors that just have a substantial lead.

Jon Quast: I guess maybe the other thing there, to your point there, and I'm going to just throw Matt here on the spot, if it is a more data software play here, Matt, do you think that Tesla with xAI, a sister company, does it have that software advantage to make a really strong competitive case here in the market?

Matt Frankel: I would say yes. How long has Elon been promising full self-driving, but they've been developing autonomous vehicle software, essentially, since the Model S came out? Every mile Model S has driven, essentially, has been recorded in one way or another. They have a ton of data. They've had more cameras on their vehicle than anyone else. They've had more sensors on their vehicle than anyone else. They do have somewhat of a technical advantage,