Elon Musk’s Tesla has become the most valuable carmaker in America with a market value of $81.39 billion. Analysts foresee trouble in the future, with one writing “We think questions remain about first half 2020 results and gross margin sustainability.”
The Daily Mail reports that Elon Musk’s electric car manufacturer Tesla has become the most valuable carmaker in America with a market value of $81.39 billion, surpassing Ford Motor’s which reached a valuation of $80.81 billion at its peak. Tesla shares climbed by 4 percent to $469.36 on Tuesday.
Tesla’s market value is still lower than both Toyota Motor Corp and Volkswagen AG. Toyota is valued at $227.90 billion while Volkswagen is valued at $98.65 billion as of market close on Monday. Short sellers of Tesla stock have lost approximately $8.4 billion over the course of the last seven months as the electric car manufacturers stock has reached record highs, beating investor expectations.
36 percent of shares were being sold short in May but many Tesla short sellers continued to retain their stock adamant that shares of the company will soon plunge. Tesla revealed on Friday that it delivered 112,000 vehicles in the fourth quarter beating estimations of 104,960 vehicles according to IBES data from Refinitiv. Although the quarterly deliveries may have beaten some estimates, the yearly car delivery number barely reached the low end of the company’s estimate. The company delivered a total of 367,500 vehicles in 2019 meeting the low expectation of 360,000 to 400,000 vehicles.
CFRA analyst Garrett Nelson wrote in a client note on Friday: “We think questions remain about first half 2020 results and gross margin sustainability; we point out that Tesla is already lowering prices in China and faces a flood of (electric vehicle) competition in the US, with at least 25 new models debuting this year.”
Breitbart News recently reported that during an event in Shanghai, Tesla CEO Elon Musk stated that the electric car manufacturer would soon open a design and engineering center in China where it would design and produce a vehicle for the global market. Musk also stated that Tesla will soon start work on a production program for the embattled Model Y vehicle in its Shanghai factory.
Musk seems to be in an increasingly cozy relationship with China at a time when many American companies are shifting business away from the communist country. Musk’s businesses have received billions in American taxpayer money, including at least $4.9 billion for Tesla and its solar subsidiary. The State of New York has taken a $900 million write-down on more than $1 billion it invested in bringing Tesla’s solar unit to Buffalo, which has not produced the economic activity the state had hoped for.
Musk also took his time on stage to perform a dance for the crowd, which Bloomberg correspondent Selina Wang mused might be part of a “charm offensive” aimed at officials of China’s communist government:
Biggest surprise at the Tesla gigafactory ceremony to mark first Model 3 deliveries? @elonmusk dancing on stage (part of his charm offensive in Shanghai in front of employees and government officials?) pic.twitter.com/fXnMdgkxuN
— Selina Wang (@selinawangtv) January 7, 2020
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or email him at lnolan@breitbart.com</strong
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