Tesla Inc (NASDAQ:TSLA)’s highly anticipated 2023 Investor Day is coming up on Wednesday, March 1, and investors will be looking for signs that the electric vehicle (EV) pioneer can maintain its leadership in the space amid rising competition from its peers.
The focus of the day will be the third version of Tesla’s Master Plan, which Tesla CEO Elon Musk has teased but provided few details on to date.
“Master Plan 3, the path to a fully sustainable energy future for Earth will be presented on March 1,” he wrote in a Tweet on February 7, 2023. “The future is bright!”
Master Plan 3, the path to a fully sustainable energy future for Earth will be presented on March 1.
The future is bright! pic.twitter.com/11ug0LRlbD
— Elon Musk (@elonmusk) February 8, 2023
In a tweet in March 2022, Musk also alluded that the plan would crossover with two of his other companies, SpaceX and The Boring Company.
“Main Tesla subjects will be scaling to extreme size, which is needed to shift humanity away from fossil fuels, and AI,” Musk tweeted.
As part of Master Plan 3, investors will be wanting details on Tesla’s plans to produce a next-generation, low-cost vehicle at around the $25,000 mark, and an update on its long-promised robotaxis.
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Investors will also be on the lookout for mentions of actions being taken by Tesla to secure its lithium supply, following reports Tesla is considering a takeover of battery metals miner Sigma Lithium Corp.
With Investor Day to be live-streamed from Tesla’s Austin, Texas Gigafactory, the EV-maker said in a brief press release: “Our investors will be able to see our most advanced production line as well as discuss long-term expansion plans, generation 3 platform, capital allocation, and other subjects with our leadership team.”
Focus on Tesla’s growth pathways
Ahead of Investor Day, Third Bridge analyst Orwa Mohamad said the biggest risk for Tesla was freshening up its product line-up and getting less reliance on the Model 3 and Model Y for growth.
“The rumored $25,000 car would give Tesla a huge boost as more competition comes through the economy segment, but cost, execution, and timeline are big question marks,” Mohamad said.
"Recent price cuts have stimulated demand, but if Tesla wants to maintain its long-term 50% CAGR target, a new cheaper platform and affordable product line is essential.”
Mohamad added that the thing to look for this year is the Gen 3 platform, which is key to the company's growth as it will allow lower-cost EVs, and, in turn, should boost volume as demand stalls and competition ramps up.
“Our experts anticipate Tesla will discuss the role of in-house battery production technologies, vertical integration, capacity expansion, and steps to source raw materials to achieve its volume and cost targets,” he said.
Musk ‘distracted’ with Twitter acquisition and other controversies
TickMill Group’s market analyst James Harte said Wednesday’s event was set to see Musk reaffirming his commitment to Tesla and laying out plans for the future.
“There has been plenty of criticism of Musk for getting distracted over the last year with his acquisition of Twitter and various other controversies which unfolded,” he said
“Tomorrow will see Musk laying out the company’s third ‘masterplan’ which is likely to see Tesla stock rallying as Musk lays out his vision for a ‘sustainable energy future for Earth’”.
Harte noted that Tesla shares have rallied more than 100% off the year-to-date lows boosted by falling US inflation and better earnings, with the rally stalling a little as hawkish Fed expectations returned on the back of the uptick in January inflation.
“Despite the broader tone of risk aversion, however, Tesla shares have remained resilient with the stock sitting just off year-to-date highs,” he said.
“The company recorded its highest-ever profits in 4Q and cited an encouraging outlook for the year ahead.”
Tesla shares had edged higher on Tuesday afternoon ahead of Investor Day, up 0.2% at US$208.02.
- Updated with analyst comments, share price -
Contact the author at emily.jarvie@proactiveinvestors.com
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