Wedbush Expects Tesla (TSLA) to Start Producing EVs in Berlin Next Month, Will Remove a Major Bottleneck Together With Austin

October 11, 2021 11:31 AM EDT
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Wedbush analyst Daniel Ives believes Tesla (NASDAQ: TSLA) should start manufacturing at its new Berlin gigafactory over the next month.

The analyst expects the Berlin introduction to remove a major bottleneck for Tesla, hence he reiterated an Outperform rating and a $1,000.00 per share price target. Moreover, Elon Musk recently announced that Tesla will move its HQ from California to Texas, and Ives expects Austin to become an epicenter of Tesla's capacity buildout as well.

“Right now many Model 3's/Y's produced in China are being exported to Europe (including a significant number in the month of September) in a logistical nightmare that is not sustainable

and thus pushing back delivery times for customers throughout the region with Berlin alleviating this issue once the factory is ready to roll. With Tesla looking to further expand its global capacity over the coming years, Berlin and Austin are key manufacturing hubs that will be key in the long term Tesla EV story as we see down the road the company producing millions of EV vehicles per year vs. roughly 870k-900k (base to bull case) this year,” Ives said in a client note.

Tesla said last week it delivered a record 241,300 cars in Q3, seen as a “robust” number by Ives. Investors are now likely to shift their focus towards earnings and 4Q ramp.

“We believe in the month of September alone Tesla delivered roughly 150k vehicles and is a clear indicator of this green tidal wave taking hold for Musk & Co. across the board. We believe China demand rebounded in the quarter and will be a focus for the Street heading into Tesla earningsin a few weeks. While there are many competitors in the EV space, Tesla continues to dominate market share as evidenced again this quarter (robust 3Q deliveries) while battling through the chip shortage and now is seeing rebounding China demand after facing headwinds earlier this year along with major supply capacity (Austin, Berlin) coming online,” Ives added.

Shares of Tesla are up almost 1% in today’s trading session.



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