Elon Musk’s Tweet Affected the Shares of Tesla
The company’s shares fell as much as 2.7% in New York after Elon Musk tweeted that the Model S Plaid+ sedan was canceled. Musk said there is no need to offer the car because the shorter-range Plaid version is really good. Shares of Tesla later recovered on Monday to end the day higher.
Tesla listed the Plaid+ on its website as offering over 520 miles (837 kilometers) of range, compared with 390 miles for the regular model S. The Plaid+ was expected to draw niche demand. The shortage of semiconductors forced Tesla to make some tough decisions with regard to production.
Another factor could be the availability of new kinds of batteries the company is developing. Tesla shared plans in September to build larger, energy-denser as well as more powerful 4680 cells that would enable the company to offer both cheaper and higher-performing EVs. This spring, Elon Musk said those cells were probably 12 to 18 months away from volume production. If battery issues for not producing Plaid+, plans for Tesla’s Cybertruck and Semi don’t look promising. The company plans to use the same 4680 cells in some Model Y crossovers
Musk’s tweet about Plaid+ came just days before a Plaid delivery event on June 10. The company’s latest decision is only the latest in a run of negative news that affected its shares. Orders nearly halved in May vs April. That information comes amid several weeks of consumer complaints about the company’s safety. In April, deliveries in China excluding exports dropped by two-thirds vs. March to 11,671.
Tesla and its rival
The company still plans to produce a Plaid version of the car that is around $30,000 cheaper. Tesla is holding a Model S Plaid delivery event on June 10, after a months-long delay in Model S deliveries amid an extended makeover.
Competitors are also working hard to make their cars more popular and one such company is Lucid Motors. The company plans to deliver its first EV, the Luxury Lucid Air sedan later this year. The initial Dream Edition will cost $169,000 and it will offer a top range of more than 500 miles on one charge.
Several months ago, special purpose acquisition company (SPAC) Churchill Corp IV made an important announcement. The company announced that it was taking Lucid public in a deal that values Lucid at $24 billion.
