Tesla’s (NASDAQ: TSLA) Investor Day event on Wednesday evening has Morgan Stanley analysts questioning how competitors will have the option to maintain up with the electrical automaker. The event, which outlined Tesla’s long-term plans for global scalability and expansion, was met with mixed reviews.
Nonetheless, the big-picture mission of the corporate, which was the true intention of the event, has made it overwhelmingly clear to Adam Jonas and other Morgan Stanley analysts that when Tesla starts to see real movement on its long-term goals, legacy automakers and EV startups alike may begin to lag behind even greater than they already are.
LIVE BLOG: 2023 Tesla Investor Day
Tesla’s true intention is to trim the associated fee of electrical vehicles, and that may occur through advances in manufacturing and vertical integration. The corporate desires to trim costs by half, which is drastic, but is ultimately crucial if more consumers are to transition to EVs.
What makes this whole thing difficult for other carmakers is that they’re already behind Tesla in a large number of how, especially within the U.S. market. Although Tesla’s plans for global scalability are completely relevant, corporations which have long been the mainstays of the automotive industry the world over are simply struggling to maintain up. Their platforms are usually not as advanced, their charging networks are usually not as robust, and their offerings are usually not as attractive.
“We leave the investor day at Giga Austin asking which of Tesla’s competitors can sustain with the planned spending of upward of $170 bn for the build-out of their manufacturing base for EVs and stationary storage,” Jonas writes. “We expect to see most, if not all, of today’s legacy auto company executive teams study the materials presented today…Over time, we’d expect the forthcoming innovations delivered to market by Tesla [to] turn out to be the industry standard, ultimately utilized by all automakers.”
As previously mentioned, some saw the event as a letdown because there was no unveiling of Tesla’s $25,000 “Model 2.” Jonas rebutted the frustration by stating that it shouldn’t necessarily have been a surprise. “From our experience, auto corporations don’t typically unveil far cheaper and potentially better-engineered products far upfront of SOP.”
It is smart because consumers wouldn’t necessarily be jumping to buy cars now at higher price points if cheaper and more advanced options were already developed and unveiled last night. It may very well be a possible inhibitor to Tesla’s current sales volume, which is very important considering it has a lofty goal of 1.8 million vehicles this 12 months.
All-in-all, Investor Day shed a lot light on how the automaker plans to revolutionize sustainable transportation and energy on an enormous scale. Cars weren’t the one focus of the day, as energy programs, including a brand new charging subscription, were detailed. Tesla also included some cryptic hints about upcoming technologies, like wireless charging for vehicles.
Morgan Stanley has a $220 price goal and an Obese rating on Tesla shares.