GM, not Tesla, is a better bet on the autonomous vehicle future right now, Deutsche Bank says

General Motors (GM)' strong competitive position in autonomous vehicle (AV) technology is widely underestimated by investors, according to a Wall Street firm.

Deutsche Bank raised its rating on the automaker's shares to buy from hold, saying the company will attain a large market share of the new AV market.

"GM's AV's will be ready for commercial deployment, without human drivers, much sooner than widely expected (within quarters, not years), and potentially years ahead of competitors," analyst Rod Lache wrote in a note to clients Sunday. "We believe that businesses built off of this platform will ramp much faster than is widely expected. A fast ramp could perpetuate sustainable advantages. And we believe that this will be material, even to a company of GM's size."

Shares of General Motors, incorporated in 1908, are up 13 percent year to date through Friday compared with the S&P 500's 12 percent return. Lache raised his price target for General Motors shares to $51 from $36, representing 29 percent upside from Friday's close.

The analyst has just a hold rating on the more popular car of the future play on Wall Street, Tesla (TSLA).

Lache estimates up to 60 percent of U.S. households in cities may find it better to use autonomous vehicle services instead of owning a car. He forecasts more than 2 percent of U.S. miles driven in 2025 will be through "autonomous on demand mobility" offerings, then rising to 10 percent share by 2030.

Lache believes General Motors can attain 17.5 percent share of the market. He cited how the company has said the autonomous vehicle and mobility business could be a potential $7 trillion global market.

"This is a massive market opportunity," he wrote. "The monetization model is recurring in nature (vs. the transactional/cyclical model that automakers live in today), and likely to receive a healthy valuation."

The analyst predicts General Motors' autonomous vehicle could be deployed within the next six quarters.

"GM management believes that their AV's, which are being tested in some of the most complex urban environments (the City of San Francisco), will be ready for commercial deployment much sooner than is widely expected," Lache wrote.

General Motors shares rose 2.9 percent shortly after Monday's market open.

— CNBC's Michael Bloom contributed to this story.