Why Tesla shares popped today

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Tesla (NASDAQ: TSLA) shares popped nearly 5% Wednesday morning after details surfaced from an invite-only investor conference. Shares were still 3.6% higher as of 1:37 p.m. ET. 

So what

The stock dropped yesterday when one electric vehicle (EV) sector analyst presented a case for why a formidable competitor might surprise investors. But those sentiments reversed today after reports started coming out on what Tesla’s head of investor relations said at the Goldman Sachs technology conference in San Francisco Monday. 

Martin Viecha provided attendees of the tech conference with a five-year plan on Monday that has been shared by Yahoo! Finance. The big takeaway for investors is the company continues to focus on cutting costs, which should lead to a new, low-cost EV model down the road. 

Now what

Viecha recalled how it cost Tesla $86,000 to manufacture a car in 2017, and that cost per vehicle is now down to $36,000. The company plans to continue to focus on cost-cutting. It recently revealed it is considering building a lithium refining plant in either Texas or Louisiana that could be in commercial production by the end of 2024. This follows comments by CEO Elon Musk earlier this year that constraints in the refining process are a major reason for the quickly rising costs of lithium-ion batteries. 

But it’s not just the discussion on cost-cutting that garnered investor attention today. It’s more the fact that it could lead to Tesla offering a low-priced entry-level vehicle like a hatchback. This also doesn’t come as a surprise, since Musk has talked about that in the past. But a more concrete plan for getting to a mass-market vehicle offering has investors boosting Tesla shares today. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why Tesla shares popped today appeared first on The Motley Fool Australia.

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More reading

• Why Tesla stock dropped today
• Better buy: Tesla stock or a Nasdaq index fund?
• Why Tesla shares moved higher today
• Where does Tesla get its lithium and do any ASX shares benefit?
• Why Tesla shares dropped today

Howard Smith has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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