With indications emerging that Tesla, Inc. (NASDAQ:TSLA)’s overseas manufacturing plant in Germany may soon come online, an analyst at Wedbush is offering his take on the development.
The Tesla Analyst: Analyst Daniel Ives has an Outperform rating and $1,000 price target on Tesla shares.
The Tesla Takeaways: Tesla’s CEO Elon Musk visited the Gigafactory in Berlin Friday and said the first cars at the factory are likely to be made available by October or sooner, Ives said.
The opening of the Berlin Giga was earlier pushed back to late 2021 due to bureaucratic hurdles and environmental issues, the analyst said. It now appears to be slated to go online by the fall, he added.
Although not ruling out further delays, given the red tape involved, the analyst said he views this news as a “positive step” on expanding Tesla’s broader manufacturing capacity globally.
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The Model 3s/Ys produced in China are being exported to Europe in a logistical nightmare that is not sustainable, the analyst said. This pushes back delivery times for customers throughout the European region, he added.
“With Tesla looking to further expand its global capacity over the coming years Berlin and Austin are key manufacturing hubs that will be key in the long term Tesla EV story,” Ives said.
Down the road, the company is likely to produce millions of EV vehicles per year vs. roughly 870,000-900,000 in 2021, the analyst said.
Capacity and supply remain the biggest hurdles for Tesla vs. demand, Ives said. With Berlin and Austin slated to open soon and ramping capacity, this will be another development that allows Tesla to drive the broader EV vision globally, he added.
TSLA Price Action: Tesla shares closed on Friday at 717.17, with after hours trading dropping the price to 716.72.
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