Tesla Shares Hit Yearly Low as Focus Shifts to Autonomous Vehicles Amid Financial Strains

Tesla hikes U.S. prices across car models

Tesla shares hit their lowest point in over a year on Thursday following a report from Deutsche Bank that expressed concerns about the company’s shift towards autonomous vehicle technology amid financial pressures. 

The shares of the company led by Elon Musk dropped by 2.7% to $151.26 after the bank changed its recommendation for the stock to “Hold” and lowered its price target from $189 to $123.

This downgrade came on the heels of a Reuters article earlier in the month, which revealed Tesla’s decision to scrap plans for a budget-friendly car expected to fuel growth. Instead, the company is focusing on developing Robotaxis using the same vehicle platform.

Tesla hikes U.S. prices across car models

Tesla is intensifying efforts to promote its advanced full self-driving driver assistance software in preparation for the Robotaxi launch scheduled for August. The bank noted that achieving full autonomous driving presents considerable challenges technologically, operationally, and regulatory-wise.

“The postponement of the Model 2 project signals the potential absence of any new models in Tesla’s consumer range for an extended period, likely exerting further downward pressure on its sales volume and pricing for many years,” said Deutsche Bank analyst Emmanuel Rosner.

Amid falling profitability driven by price reductions aimed at stimulating demand for its electric vehicles, Tesla earlier this week dismissed over 10% of its global workforce as it seeks to reinstate Musk’s substantial compensation package from 2018.

Shareholders have been requested to reapprove Musk’s $56 billion compensation agreement set in 2018, which a Delaware judge dismissed in January.

On Thursday, Tesla’s stock plunged to its lowest level in nearly 15 months, reflecting a 37.4% decline in value for the year, making it the second worst performer on the S&P 500 index. The company’s market value could drop by more than $17 billion to approximately $478 billion, assuming the losses continue. Despite these challenges, Tesla remains the most valuable automaker globally.

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Pooja Chauhan

Pooja Chauhan: Your Source for Entertainment and Box Office News Pooja Chauhan is a passionate writer and dedicated journalist specializing in delivering the latest updates and insights from the world of entertainment and box office. With a keen eye for detail and a deep love for cinema, Pooja brings her readers accurate and engaging coverage of all things related to movies, celebrities, and the dynamic world of showbiz. Her commitment to keeping her audience well-informed and entertained makes her a valuable voice in the realm of entertainment journalism. When she's not busy uncovering the latest scoops, Pooja enjoys exploring classic films and indulging in creative writing." Contact us: admin@bollywoodfever.co.in

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