What’s happening: Tesla’s Model S Long Range Plus received an EPA rating, making it the first electric vehicle to receive a rating from the agency for over 400 miles.
What happened: The EPA (Environmental Protection Agency) said the model can go 402 miles on a single charge. “All Model S cars made since late Jan have 402 mile range,” Tesla’s CEO Elon Musk said in a tweet.
Meanwhile, Tesla’s shares have breached the $1,000 mark a couple of times this month, making it the most valuable in the world. The stock is being driven by soaring demand in China, the company’s plans to ramp up production of its electric freight truck - the Tesla Semi, and speculations of Tesla being in talks to expand its production capabilities in the US.
Why it matters: There has been a spike in the demand for electric vehicles globally, as countries look for options to lower their dependence on fossil fuels.
Against this backdrop, Tesla has been witnessing robust demand in China. The China Passenger Car Association (CPCA) said Model 3 sales from the company’s Shanghai facility had tripled to 11,095 vehicles in May, surpassing sales of local Chinese companies.
Tesla lowered its Model 3 price, after Beijing's Environmental Exchange launched an incentive program earlier this month for EV automakers selling vehicles below a specified price, said a report by Market Realist.
Investor sentiment was also boosted by CEO Elon Musk’s memo, which was published online stating that it was “time to go all out and bring the Tesla Semi to volume production.” There were also speculations of the company being in talks with the Texas government regarding an incentive package to set up a factory in Austin.
Till late last year, Tesla had only one production unit. The company set up its second facility in November in Shanghai, with the aim of gaining a strong foothold in the massive Chinese market. Tesla now has a plant underway in Germany and has indicated that another US-based assembly factory will be announced soon.
Earlier this month, the Nasdaq 100, of which Tesla is a major component, surged past the 10,000 milestone. Tesla traded as high as $1,027.48 on June 10 and went past the $1,000 mark earlier this week. The stock closed yesterday’s session at $991.79.
US indices trading was under pressure yesterday, with only the Nasdaq 100 gaining 0.2%. The Dow Jones index and S&P 500 lost 0.7% and 0.4%, respectively.
What to watch: Investors are hopeful of a strong rebound in Tesla’s US sales, which have been under pressure since the covid-19 outbreak. The company is also facing stiff competition from other EV leaders, like BMW. Although the stock has gained almost 25% over the past month, it has shed 3% in the past five days. Investors may see this as an attractive entry point, sending the stock past the $1,000 level again.