Tesla Achieves Model 3 Weekly Production Target

Tesla Achieves Model 3 Weekly Production Target


Elon Musk, the founder and CEO of electric car manufacturer Tesla, Inc. (NASDAQ: TSLA) tweeted late Sunday that the California factory achieved the production target of 5,000 Model 3 in a week. Musk also revealed that the factory manufactured 7,000 cars overall in a week. Skeptic short-sellers have lost more than $2 billion this month by going short in Tesla’s stock, hoping that the factory will once again miss the self-imposed deadline. The stock has appreciated by more than 40% from the low recorded in April. The trend is expected to continue and the bears are expected to lose further in the week ahead due to details provided underneath. Tesla closed Monday’s trading session at $335.10.

The company has set itself an ambitious target of manufacturing 6,000 vehicles per week by the end of next month. According to the details available, Tesla rolled out 5,031 Model 3 vehicles in the final week of second-quarter. Furthermore, it manufactured 1,913 Model S and Model X vehicles. Overall, Tesla manufactured 55,339 vehicles during 2Q18, up 55% from the previous quarter. Specifically, 28,578 Model 3 vehicles were manufactured during the recent-quarter, compared with 24,761 Model S and Model X vehicles, put together.

Tesla has achieved this merit after missing production targets twice. Elon Musk has been trying to convince investors that it would produce 5,000 Model 3 cars before the end of second quarter. The company has also revealed that Model 3 reservations exceeded 450,000 at the end of first-quarter, after accounting for cancellations and new orders. Even though Model 3 is advertised as a $35,000 vehicle, Tesla is currently manufacturing only the costlier version of the vehicle. The company has not provided the orders it has for upmarket versions.

In the past eight years, the company had only two profitable quarters and is deep in red. However, Musk has stated that the company would return to profit once Model 3 production target is achieved. The company has also reaffirmed its forecast of net profit and positive cash flow in the third and fourth quarters, despite weak US dollar and higher import tariffs in China.

The price chart indicates that the stock is on the verge of breaking above the ascending triangle pattern. The MACD indicator is in the positive zone. Therefore, we can expect the stock to rally in the days ahead.

Tesla - Technical Analysis - 3rd July 2018

To benefit from the uptrend, we are planning to invest in a call option, which is offered by a binary option broker. The option should be valid for a period of one week. Furthermore, the stock of Tesla should be trading near $335 in the NASDAQ. We may invest in a call option contract only if these conditions are satisfied.

Disclaimer: The trading analysis offered here is our opinion. It is not provided as trading advice, merely an indication of our trading plan. We cannot guarantee success and we encourage traders to incorporate a strong money management strategy to limit losses. Please use this article as part of your own research before formulating strategies prior to trading.

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