Poorly capitalized firms are victims in the electric vehicle stock flop that began last year. Polestar (PSNY), for example, trades at under $1.00. Tesla (TSLA) is emerging as the winner.
Tesla halted accepting orders for its cheapest Cybertruck. The rear-wheel drive version had 250 miles of range and a price tag of $61,000. This pushes the lowest price truck EV to $99,990 for the all-wheel drive version. This model has a 318-mile range.
Bears, who are a rare bunch holding a small 3.13% short float against TSLA stock, might speculate the lowest price model faced weak demand. This view does not make sense. Tesla had around one million Cybertruck preorders. They very likely wanted to buy the most affordable version. Its lack of availability might benefit Rivian Automotive (RIVN).
Markets are skeptical, however, that Rivian will enjoy higher sales. RIVN stock spiked to around $19 last month before trending lower. Shares fell again after the firm posted earnings on Aug. 6, 2024. It reported a $1.255 EPS loss.
Tesla potentially decided to lower inventory for its Foundation Series. The model, which has the “Foundation” log etched on the body, costs over $100,000. It has far higher profit margins than the lower models.
Telsa should reconsider the order halt. If customers demand cheap Cybertrucks, the firm should sell more of them.
Tech Insider
