Tesla claims that it would reduce the price of its next generation of vehicles by half, mostly through the utilization of cutting-edge production methods and more compact manufacturing facilities.
Elon Musk, Tesla’s CEO, and other company executives delivered the company’s third master plan Wednesday at a presentation lasting three and a half hours and taking place at Tesla’s headquarters in Austin, Texas. During that time, they described the company’s aims.
Because of the modifications, the price of a brand-new generation of automobiles might rise to roughly $25,000. A great number of investors were hoping to catch a glimpse of the next generation of vehicles, but Musk stated that they would not be shown until a full product unveiling took place.
“We’d be jumping the gun if we answer your question,” about the new vehicles, he told an analyst.
During the presentation that was held in the after-hours trading session that began just after 8:00 p.m. Eastern Time, shares of Tesla plummeted by roughly 6%.
Musk has revealed that Tesla has intentions of constructing a new facility in Mexico, in the general vicinity of Monterrey. Executives of the company have stated that Tesla will not transfer manufacturing away from any other plants, even though the company plans to grow production there. They stated that the plant in Mexico would be responsible for the production of the next generation of automobiles, which will also be manufactured at other plants.
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Although it wasn’t made quite obvious in the presentation, it’s highly likely that the future generation of automobiles will be far smaller in size than the ones that are now on the market. In order to keep their profit margins stable and reduce the amount of money spent on labor, several manufacturers build their smaller automobiles in Mexico.
CFRA Analyst Garrett Nelson attributed the decline in Tesla’s stock to the lack of details on the new vehicles as well as the company’s history of seeing its share price rise ahead of major events, only to fall when the actual news was made public. Additionally, Nelson cited the company’s history of seeing its share price rise ahead of big events, only to fall when the actual news was made public.
He acknowledged that the long-term emphasis of the company may have dissatisfied some investors, but he believes that Tesla’s vision justifies the company’s high stock valuation in comparison to that of other automakers.
He said-
“What they outlined really made the case that it deserves to trade at a big premium to the rest of the industry,”
The head of Tesla’s design team, Franz Von Holzhausen, stated that the firm needs to achieve another significant cut in costs in order to meet its ambitious goal of producing 20 million electric vehicles per year by the year 2030. This goal was set by the corporation. Tesla anticipates that it will produce 1.8 million vehicles this year.
According to what he indicated, the corporation would construct the automobiles using a series of smaller modular pieces, which will subsequently be assembled. The system requires a less amount of area. Officials have stated that as a direct consequence of this, the company’s subsequent electric powertrain manufacturing will be one-half the size of the one Tesla has just finished building in Austin and will cost 65% less.
Said Tom Zhu, who leads Tesla manufacturing-
“That also means we can build more factories at the same time,”
According to the company’s Chief Financial Officer Zachary Kirkhorn, expenditures were lowered in half between the first generation of Models S and X and the second generation, which consisted of Models 3 and Y. According to him, not only does the company intend to do that again for the next generation, but it also plans to upgrade the cars at the same time.
In addition, the business declared that it would redesign automobiles to have fewer cables and transistors, and that the batteries would make use of a reduced quantity of pricey rare-earth metals.
Kirkhorn Said-
“As we improve affordability, the number of customers who have access to our products increases”
Musk stated that there is a significant demand for Tesla automobiles, but a lot of people who want one right now can’t afford one.
Executives have stated that one thing that sets Tesla apart from other automobile manufacturers is that all of the employees involved in the process of designing and manufacturing vehicles are in the same room. Whereas other businesses rely on multiple tiers of components supply firms, this company designs and creates a significant portion of its own hardware and software.
Also, the firm announced on Wednesday that it has opened ten of its supercharger stations to owners of different types of electric vehicles. And it has plans to offer a bundle of unlimited home charging in Texas for the low, low price of $30 per month, using wind energy as the source of power.
Kirkhorn stated that the new master plan will incorporate both technological and product advancements along with significant volume growth.
Musk opened the presentation by stating that there is a clear road to sustainable energy on Earth, but that it will require converting just about everything from power supplied by fossil fuels to electricity generated by sources that are renewable. According to him, the Earth is capable of housing a greater population than it already does so without causing significant damage to its natural environments or imposing severe rationing.
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