Tesla (NASDAQ:TSLA) stock is up $9/share since Christmas on reports it will revamp its Model Y from a Chinese plant and announce a new plant in India.
The new Model Y could make Tesla more competitive in the world’s largest electric vehicle (EV) market. Its Indian plant would be built in the state of Gujarat, on the country’s west coast, north of Mumbai.
TSLA stock was trading early this morning at about $264 per share. Its market capitalization was approaching $840 billion.
High Hopes
Tesla shares are up 112% in 2023 but peaked in July at $293.
Tesla bulls are looking for catalysts beyond just the company’s cars for 2024. Morgan Stanley analyst Adam Jonas expects Tesla to begin supplying other companies with its self-driving and robotics technology. He believes the software business is worth more than the company’s car business.
The idea that “Tesla is a tech company, not a car company” has long propelled Tesla bulls. That’s true even though 83% of its revenue comes from selling cars.
Bloomberg says the Model Y changes will be obvious at a glance. The new car will go into mass production mid-year.
Tesla’s unannounced India plant will reportedly cost $2 billion and come with Indian promises to cut tariffs in exchange. CEO Elon Musk is expected to announce the plant at a “Vibrant Gujarat” summit next month alongside Prime Minister Narendra Modi. While Indian officials said just two weeks ago they have no plans to cut tariffs, a cut could come alongside local production.
While Tesla has suffered bad publicity in the U.S. and Europe, including demands for recalls and a strike in Sweden, growth in Asia could more than offset that.
TSLA Stock: What Happens Next?
The recent news emphasizes Tesla’s role as a global business, not just an American one. Expect more headlines and controversy from the company in 2024.
As of this writing, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
