HomeMarket NewsThe Critical Eye on Tesla: Debunking the Notion of a Multi-Faceted Powerhouse

The Critical Eye on Tesla: Debunking the Notion of a Multi-Faceted Powerhouse

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Analyzing the Bearish Stance

Given Wall Street’s current climate, concerns are mounting regarding Tesla Inc’s core business. Analysts are reconsidering potential growth avenues, with a bearish perspective emerging that challenges the entrenched belief in Tesla being more than just an automotive company.

Voices of Dissent

GLJ Research analyst Gordon Johnson recently took to Twitter to share the insights of value investor Mark Spiegel from Stanphyl Capital Partners. Spiegel’s arguments against the narrative of Tesla extending beyond a car company are compelling:

  • AI Team Exits: Three pivotal members of Tesla’s AI team departed in October 2023, casting doubt on the company’s AI capabilities.
  • Charging Dilemma: Uncertainty surrounds the profitability of opening charging infrastructure to other automakers. Spiegel posits that rivals adopting the open-sourced NACS protocol could lead to Tesla losing more in car sales than gaining in charging profits.
  • Competitive Erosion: The competitive landscape is encroaching on Tesla’s territory as rival offerings match or surpass its features. Recent quality surveys have placed Tesla poorly, amplifying competitive pressures.
  • Cybertruck Concerns: The Cybertruck may not deliver the growth envisioned, facing stiff competition upon significant production ramp-up in late 2024 from Ford, GM, Dodge, and Rivian.
  • Battery Reality: The myth of Tesla’s proprietary battery technology is debunked; research suggests most cells are purchased from Panasonic and LG. The challenges around manufacturing 4680 cells are formidable, with the potential for rival manufacturers to enter the fray.

See Also: Everything You Need To Know About Tesla Stock

Should Tesla be regarded solely as an automotive entity, challenges on the horizon might be more palpable. The automotive industry, especially the EV sector, grapples with uncertainties attributed to cost considerations and range boundaries.

Moreover, Tesla faces fierce competition from ambitious Chinese startups like BYD, offering a diverse EV lineup at competitive price points. Tesla’s anticipated sub-$30,000 vehicle is not anticipated before late 2025 or early 2026.

Notably, Tesla closed Thursday’s trading session at $162.50, reflecting a 10-month low, as per Benzinga Pro data.

For more articles on Benzinga’s Future Of Mobility, click here.

Read Next: Cathie Wood To Tesla’s Rescue? Ark Invest Scoops Up $35M Of EV Giant’s Sliding Stock

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