Tesla

Tesla

25 July 2018Reading time: 3 minutes

Tesla was founded in 2003 by Elon Musk. By now the company sells alongside electric cars also solar panels and battery packs. Besides that Musk wants to introduce electrically powered trucks on the market. On June 29, 2010 Tesla received a stock exchange listing on the Nasdaq with an introduction price of 17 dollar per share.

The American car manufacturer is considered as one of the pioneers for electric driving. This is clearly a grow market within the automotive sector. Last year approximately 4 million electric cars were sold worldwide and it is expected that this number will increase in the coming years to almost 30 million cars in 2025. This growth will among other things be stimulated by government grants for electric driving. It remains to be seen how long these government support measures will continue. In Germany for example, the government decided that 800 owners of the Tesla model S have to pay back 4.000 euro worth of grants per car, because their cars are too expensive for the financial support program. Another 250 people who have bought a Model S recently, won’t receive a government grant.

The Model S was very successful for Tesla during the last years. In the coming years the company especially wants to make a success of the Model 3, which is a high volume model. This new model should bring the company its first profit. However, during the past period there were some production issues with the Model 3. Therefore the company reached the production goal of 5.000 Model 3 cars only by the end of June this year. By now large car manufacturers such as Daimler, Renault and BMW also invest heavily on electric driving. Partly because of that, PA Consulting Group expects that Tesla will be outpaced in the coming years by these large car manufacturers.

Furthermore, CEO Musk received negative media attention in the past period. During a conference call in June with analysts, Musk qualified several financial questions about the company as ‘boring’. He also ended up in several negative discussions on Twitter. Shareholders demanded that Musk focusses on its company and the production. By now Musk has apologized for his negative comments on Twitter.

The considerably negative messages about Tesla have caused for a very volatile stock price. On an annual basis the stock price is now (18-07-2018) 1,6 percent lower at 322,69 dollar. The future price of the stock is subject to several political, industrial and sector specific as well as economic factors. Investors should consider such risk when making their investment decisions. Developments can be different at any time than investors expect, which can result in capital losses.

Vontobel products on Tesla are tradable at DEGIRO.


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16/06/2019 08:54:47