Tesla Battery Day was "very visionary and not very specific"

Tesla stock (Tesla shares - Ticker: TSLA) plunged 8,6% in Wednesday's trading session, and was on track to break out of the lowest close of the past two weeks. All of this happened the day after Tesla's long-awaited Battery Day. Shares fell more than 20% in September, but have almost quadrupled this year.

Tesla's Battery Day

On Tuesday, Tesla unveiled a roadmap for new batteries, which are 56% cheaper and more efficient and set to lower the prices of electric cars. The projects included changes to battery size, design and engineering and are under development at a pilot plant in Fremont, California.

The company also announced a future $ 25.000 fully autonomous car within three years and a Model S sedan with longer range and a more efficient, faster engine. "It works but not with a high return," Chief Executive Elon Musk said at the event, plunging the title in the late session on Tuesday.

“Overall, Tesla's battery day was rich in perspective and boldness, but lacking in specs and short-term results,” Bernstein's Toni Sacconaghi said in a statement. The event "at times seemed more visionary (even" vaporware ") than specific, with few details" about the production locations, times and key technical milestones reached so far, "he said.

Furthermore, improved battery technology is only a small part of Tesla's journey towards achieving the goal of selling a car starting at $ 25.000, Sacconaghi said. As a positive outcome of the day, there is Musk's claim that he expected Tesla to grow 30% to 40% this year and that "seems to be pushing towards a strong quarter," he said.

The opinions of the experts

Emmanuel Rosner of Deutsche Bank spoke out in favor of buying Tesla stock as an investment in the future, saying that Battery Day showed an "impressive trajectory in technology, capacity and cost, which should help accelerate the world's transition to electric vehicles and considerably extend Tesla's lead ”.

In addition to improvements to battery technology and the $ 2 "Model 25.000" car, Tesla also unveiled plans to build battery cells with "massive" capacity, which would open new markets for Tesla in long-term truck transportation. range, in energy storage and in supplying batteries to other manufacturers, Rosner said.

Adam Jonas of Morgan Stanley commented that it is "too early to say whether the increase in execution risk is commensurate with the potential increase in revenue, not to mention the already heavily discounted part in the current share price."

Garrett Nelson at the CFRA said he was "impressed" by Tesla's plans, but the hype that led to the event was such that the "sell the news" reaction was perhaps inevitable. "If there was a disappointment, we think it was the fact that no million-mile battery was mentioned," he said.