Tesla expected a rise in share value after Battery Day, but the opposite actually happened as investors seem to expect more.
On Tuesday, Tesla saw a considerable $20 billion drop in its market cap in only two hours. Unexpectedly, that happened right after Elon Musk introduced his upcoming plans on Battery Day.
Musk recently promised that Tesla would develop cheaper, low-cost batteries, that it would release a $25,000 EV shortly and that it aimed to produce 20 million vehicles a year. The problem is, none of these plans will come into action until 2023. And, since Musk tends to plan on the shorter side of things, we might have to wait a tad longer than that.
With that being said, Battery Days’ biggest news was Tesla’s new “tabless” battery cell. According to Musk, the upgraded cell will provide 54% more range, cut battery costs down by 56%, and investments required by 69%.
However, the company claims that these plans will take at least three years to come into fruition — obviously, that disappointed investors, who expected more. In the hope of a positive announcement on battery day, Tesla shares climbed up by more than 400% this year.
Surprisingly, market analysts appreciated Tesla’s Battery day. Unfortunately, investors were not as optimistic since the EV manufacturer did not launch a new battery, instead promising one. Also, the expected production date of Tesla’s “tabless cell” was not so precise either.
“The extreme difficulty of scaling the production of new technology is not well understood. It’s 1,000% to 10,000% harder than making a few prototypes,” Musk said. “The machine that makes the machine is vastly harder than the machine itself.”
Musk also mentioned that Tesla is testing out producing batteries at its Fremont factory and plans to build another production plant in North America.
To be continued…
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