Good News From Tesla

Tesla made an important update about the electric truck tractor project, which was introduced by Elon Musk in 2017 and experienced various delays.

The company announced that the Tesla Semi will begin customer deliveries by 2026.

Tesla executive Dan Priestley announced that they are building a factory in Nevada and that this factory will be ready for customer deliveries in 2026.

The annual capacity of the factory will be 50,000 vehicles and I expect an average price of around $200,000. Thus, an additional turnover of around $10 billion will come from vehicle sales alone.

The Tesla Semi is in pilot testing with PepsiCo's FritoLay division, and 50 more trucks will be included in the test program.

The long-range version of the Tesla Semi will have a range of 500 miles. The standard range truck will be able to travel 300 miles when fully loaded. These trucks will be able to travel more than 1000 miles in a 24-hour period thanks to the fast charging feature.

Another positive news was about last week's Chinese sales figures, there is a slowdown in decline.

Tesla China weekly (week 20: May 13-19) vehicle registrations stood at 13,800, indicating that the sales decrease compared to 2023 is down to just 8,000 vehicles as of the 20th week of 2024.

So Tesla is only 4% behind the same period in 2023 since the beginning of 2024.

This result runs counter to the widespread narrative that Tesla's China sales are 'falling off a cliff' as Chinese rivals continue to launch new vehicles supported by large-scale marketing campaigns.

Increasing competition has been causing electric vehicle prices to fall in China for months. This is a problem for all automakers, including Li, XPeng and Tesla.

Earlier in the week, Li Auto reported weaker-than-expected revenue, and management's revenue forecast of about $4.2 billion for the second quarter was up just 6% from a year earlier. This figure was about 20% below Wall Street estimates.

My comment: Tesla China's domestic market performance is strong, with Model Y emerging as the second best-selling car in the Chinese market. Recent sales figures reflect its growing popularity in the country.

I do not find realistic the claims that Chinese companies' sales are decreasing despite receiving government support, while Tesla's sales figures are slowing down due to its more profitable balance sheet, and that it cannot survive in the Chinese market.

The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.

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