Tesla didn’t attract the same kind of hype it has in the past when it announced last week its crossover SUV, the Model Y. The zero-emissions announcement was greeted with skepticism rather than excitement, which has only mounted since then.
Stock prices plummeted (over what period of time – last week into this week, for two weeks) as the automaker launched a new round of layoffs last week, after announcing it would close most stores in favor of online sales.
“Much of the bull narrative has rested on Tesla being the next Apple, selling high-volume EVs at premium price point and at high gross margins, in part aided by a unique branded retail presence — a narrative we see as undermined by the recent price cuts and closing of most of the stores,” Barclays analysts said last week.
The company is planning to formally unveil the vehicle for the first time this Thursday at the company’s design center in Hawthorne. However, the announcement from CEO Elon Musk announced the new vehicle on Twitter failed to reverse a slump in Tesla stock prices. Instead, shares finished the Monday down more than 3 percent. That’s a significant change from previous unveilings, which have usually boosted stock prices for the company.
Additionally, current and former employees say that Tesla executives still have not decided where to manufacture the Model Y. Tesla vendors contacted by CNBC say they didn’t hear from the company regarding Model Y production until after the Twitter reveal.
Tesla representatives have pointed to a February letter to shareholders suggesting that production will begin in 2020, most likely at the Gigafactory, the company’s massive battery plant outside of Reno, Nevada.
However, the uncertainty has many market spectators wary, with some speculating that the rushed announcement was meant to counter waning confidence in Tesla.
“Last year featured a number of idiosyncratic events that shaped the Tesla narrative and, just 2 months into 2019, it seems to be another year of significant volatility, driven by both economic factors and company-specific factors,” Morgan Stanley analysts wrote in a note to clients on March 1.