Tesla’s Investor Day Leaves Investors Wanting More, Stock Drops Over 5% just a few hours after the event

On March 2nd, 2023, Tesla held its Investor Day presentation in Austin, Texas, with CEO Elon Musk taking the stage to share his “Master Plan 3” and discuss the company’s plans to scale up in the face of increasing competition. The presentation highlighted Tesla’s past achievements but was short on specifics about new products or services. Tesla’s Investor Day Leaves Investors Wanting More, Stock Drops Over 5% just a few hours after the event.

Tesla’s Investor Day Leaves Investors Wanting More

Musk began the presentation by stating that there is a clear path to a sustainable-energy Earth that doesn’t require destroying natural habitats or being austere. He believes that a civilization much bigger than Earth’s current population of 8 billion could be supported sustainably with renewable energy.

Musk was joined on stage by Drew Baglino, Senior Vice President of Powertrain and Energy Engineering at Tesla. They discussed Tesla’s role in repowering the grid with renewable fuels as they ramp up battery production for both their electric vehicles and utility-scale energy storage systems. Tesla aims to produce 20 million electric vehicles annually by 2030, as the company reported delivering around 1.31 million vehicles in 2022.

During the Q&A session following the presentation, executives addressed a question about how Tesla plans to grow its market share in China. The company plans to expand its production capacity in China and work with local partners to ensure they meet Chinese customers’ needs. They will also continue to invest in research and development to improve their products and services, ultimately increasing their competitiveness in the Chinese market. Tesla’s Investor Day presentation focused on its vision for a sustainable-energy future and its plans to continue growing its business through increased production and expansion into new markets.

During Tesla’s recent Investor Day presentation, a question was raised about how the company plans to increase its market share in China. The question was passed to Tom Zhu, who has been heading up global production and managing Tesla’s China and Asia-Pacific businesses for years. Zhu stated that as long as Tesla offers affordable products with value, they do not have to worry about demand. He also mentioned that Tesla tries to cut costs and pass down the value to its customers. Musk added that demand is a function of affordability and that even small changes in price can have a significant effect on demand. Zhu also announced that as of that day, Tesla had produced 4 million cars in total, demonstrating the company’s improving operational efficiency.

Zhu said that Tesla plans to build new car and battery cell factories and increase production at its existing factories. This aligns with Tesla’s goal of producing 20 million electric vehicles per year by 2030, as the company reported delivering around 1.31 million vehicles in 2022.

Tesla’s charging leader, Rebecca Tinucci, shared that the company provided 9 terawatt hours of electricity across various charging methods, including home charging and 40,000 Superchargers, in 2022. She also noted that approximately half of Tesla’s Superchargers in the EU are open to other vehicles, and the company recently opened ten Superchargers in the US to non-Teslas.

Tesla’s commitment to renewable energy and sustainability was a recurring theme during the presentation, with Musk highlighting the importance of a sustainable-energy Earth that can support a civilization much bigger than Earth’s current population sustainably. The company plans to play a significant role in repowering the grid with renewable fuels as they ramp up battery production for its electric vehicles and energy storage systems.

During a press conference ahead of Tesla’s 2023 Investor Day, design leader Franz von Holzhausen and vice president of vehicle engineering Lars Moravy announced several planned manufacturing changes aimed at improving Tesla’s vehicle production efficiency. However, the company did not reveal any details about its “next gen” vehicle.

Powertrain vice president Colin Campbell revealed that Tesla’s next powertrain factory will be 50% smaller than the one in Austin, Texas, but will have the same capacity. He also stated that the company is working on a new kind of drive unit that is compatible with any battery cell type and a motor that will be built without any rare earth metals.

On Tuesday, Mexico’s president, Andres Manuel Lopez Obrador, announced that Tesla had agreed to build a large factory in Monterrey, Mexico and that the company would use recycled water and take other initiatives to cope with water scarcity in the region. Elon Musk confirmed the factory plans on Wednesday and noted that production there would supplement, rather than replace, any manufacturing at other Tesla facilities.

Tesla’s shares have rebounded from declines during 2022 and are up more than 60% for the year so far. However, the stock dropped 1.43% on Wednesday prior to the event and 5% after hours. Mizuho Securities analysts maintained a buy rating on shares of Tesla ahead of Investor Day, seeing the company in a leadership position in the growing market for fully electric vehicles. They noted that cheaper competitor EVs coming to market could potentially dilute Tesla’s share of the US EV market, as currently, the lowest-priced Tesla available is the Model 3 sedan, which starts at around $43,000. Mizhuo highlighted that seven models from other automakers are currently priced below that.

In summary, Tesla’s press conference ahead of Investor Day revealed some manufacturing changes and plans for a new factory in Mexico. However, the company did not provide any details about its upcoming “next gen” vehicle. Analysts maintained a positive outlook on Tesla’s market position but noted potential challenges from cheaper competitor EVs entering the market.