 "In Tesla's best day in a decade, EV maker adds $150 billion to market cap as share price skyrockets")
Tesla shares soared nearly 22 per cent last week, marking the company’s biggest single-day surge in over a decade. This dramatic rise, which added around $150 billion to its market value, came after CEO Elon Musk assured investors of strong sales growth and new, affordable electric vehicles (EVs) in the pipeline.
Musk projected sales growth of 20-30 per cent for next year and promised that a budget-friendly Tesla model would hit the market in early 2025.
Bold forecasts and production wins
Musk also highlighted the company’s success in trimming production costs, which improved margins during the third quarter. Tesla’s upbeat performance allayed concerns that the company’s attention was straying too far from its core business of selling electric cars.
Tesla’s stock reached a session high of $262.2, with around 200 million shares changing hands. This impressive rally erased some recent losses that had stemmed from fears Musk was becoming too distracted by ventures like the new Robotaxi initiative.
Shifting focus: from EVs to AI and robotics
Musk has gradually repositioned Tesla as more than just an EV maker, diving into artificial intelligence and robotics. However, a lack of concrete business plans for these new directions had left some investors uneasy. Earlier this month, Tesla shares had dipped following a robotaxi presentation that lacked specifics, frustrating those eager for more clarity.
Despite the earlier concerns, the latest announcements seem to have brought some relief. The third-quarter results exceeded Wall Street expectations, with the cost of producing each vehicle dropping to an all-time low of $35,100. Tesla also reported $326 million in revenue from its Full Self-Driving (FSD) software, which powers its Cybertruck and some autonomous features in certain other EVs that the company offers.
Impact Shorts
More ShortsInvestors split on Tesla’s future
While Musk reiterated his vision of Tesla vehicles offering paid driverless ride-hailing services next year, regulatory hurdles could delay these ambitions. FSD, however, remains a critical piece of Tesla’s long-term strategy, with analysts predicting it will play a significant role in boosting future profit margins.
Not all investors are entirely reassured. Ross Gerber, a notable Tesla investor, expressed frustration with Musk’s recent distractions, hinting at a longing for the days when Musk was more hands-on at the factory. Concerns remain about Musk’s focus shifting away from Tesla’s primary business, even as the company’s latest performance has rekindled some investor confidence.
For now, though, Tesla’s surge on Thursday has shown that the electric car giant still knows how to electrify the market when needed.
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