At the start of the month, Tesla seemed to be in a somewhat precarious position. While their Q1 financial report was very positive, the shutdown of their Freemont factory put their manufacturing output into question. Then Tesla investors were shocked when Elon Musk himself tweeted out that his own companies stock was too high.
But the ten percent drop TSLA saw that day is now just a blip. The stock price is now higher than it was before that tweet. Where is this new confidence coming from?
Getting back to work
Tesla fought hard to reopen their Freemont factory. After being blocked from reopening by Alameda County health officials, they filed suit and defied the order. The county relented, acknowledging Tesla’s comprehensive reopening plan. They began augmenting their minimum business operations last week, preparing to fully restart production.
And now today, they have been officially allowed to restart production with safety precautions in place. It seems the sentiment is that Tesla has now weathered the storm. They’re now able to keep moving forward with their plans. And other auto manufacturers have stalled their EV plans, with delays in production.
If Tesla is able to continue putting out new cars while the rest of the industry sits on their hands, they should be set to dominate the EV industry. But there are concerns about how the EV industry will do as a whole.
With rock-bottom gas prices and widespread economic hardship, a brand new EV isn’t at the top of many people’s wish list. Tesla is going to be able to make more cars now, and might even hit half a million cars by the end of the year. Restarting production might rally investors in the short term, but we’ll have to wait a few months to see how Tesla can really perform during this pandemic.
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