This week we have seen Tesla’s shares soar again to a maximum never seen in the North American manufacturer. A boost that has allowed it to exceed the $1,000 barrier for the first time momentarily, which has also been the milestone of becoming the world’s largest capitalized automaker, beating Toyota. But what are the reasons for this meteoric at a time when the Down Jones Industrial is trading lower?
According to Barrons analysts, the reasons are the new projects looming on the horizon of a Tesla that has multiple initiatives. Allowing it to continue increasing its difference with traditional manufacturers when it comes to electric cars.
One of the essential points is related to the revolutionary batteries that Tesla has been developing for some years. On the one hand, a completely new system will increase its independence in terms of this crucial component. A real problem for brands that have later joined the electricity sector.
The great importance of Tesla’s “million-mile” battery system is that could last decades, adding more independence. This design will allow Tesla to eliminate purchase costs from third-party companies, increasing its profit margin, as it is high. Some news that will be presented on the “Battery Day” that still has no date of completion, we can also find out if they have finally managed to pass the barrier of $100 per kWh, which is estimated to be necessary to equalize the price of production of an electric car with a combustion one.
The third part of the batteries section is the question of their long useful life. According to Tesla, these may have a duration of more than a million miles or 1.6 million kilometers. A perspective that certainly seems to have liked the markets a lot for the idea of practically eternal cars, and with a good residual value even in the long term thanks to their battery.
There is also the question of expanding the product portfolio. After the arrival of the Model Y, Tesla is now busy launching the Semi. This week, the electric truck has finally received the green light for its production after a dance of delays. A model that, according to an internal mail, will begin its manufacture this year.
Tesla’s shares have catapulted to unthinkable levels recently and have seen Model 3 sales in China. A market in which Elon Musk has placed high hopes and which is responding with strong demand. Above all with some models of local production that are reaching astronomical profit margins, and still with room for improvement.
Add the excellent progress of the German Gigafactory, which, despite the difficulties due to the world situation in dealing with coronavirus, is advancing at full speed. An installation that should start producing vehicles in mid-2021, and even according to rumors, could be sooner.
A set of news that has caused Tesla shares to see their value increase by 126% so far this year. A significant figure that is also taking place at a time of severe economic crisis due to the pandemic that seems to be taking its toll on neither the manufacturer nor the confidence of investors.