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While Tesla (TSLA) stock has crashed over 50% over the last month, its fundamentals currently remain solid. Tesla is facing a massive blow on its manufacturing facilities due to the coronavirus outbreak.
The COVID 2019 outbreak has taken a huge toll on the global markets and Wall Street’s once best performer Tesla Inc (NASDAQ: TSLA) took a severe beating. Just over the last week, the Tesla (TSLA) stock has crashed nearly 30% showing extreme volatility.
Tesla (TSLA) Stock Today
Despite Dow Jones recovering over 5% on Tuesday, the Tesla stock went down 3% closing the day at $430 levels. Just in a month’s time, Tesla’s valuations have sunk by 50% with its market cap going below $80 billion. But even today, Tesla’s market cap is more than the combined market cap of Ford Motor Company (NYSE:F) , General Motors Company (NYSE: GM) and Fiat Chrysler Automobiles N.V. (NYSE: FCAU).
Moreover, despite the share price taking a massive beating, Tesla investors don’t need to worry as the fundamentals remain unchanged. Thus, it looks like Tesla is all poised to absorb the production jolts it has received with the coronavirus pandemic. The COVID-19 spread has exacerbated the conditions over the last two weeks bringing businesses on a major slowdown.
European car-maker Tesla has suspended its production activities and shutdown factories all across Europe. Similarly, Tesla has been facing a major challenge when it comes to ramping up production in the Tesla gigafactory in Shanghai, China. Also, Tesla’s plan of opening another gigafactory in Berlin, Germany, looks in doldrums as of now.
After strong Q4 2019 results, Tesla promised 500,000 card deliveries by the end of 2020. However, it remains to be seen as to how Tesla manages for the loss during the Q1 period. However, Tesla boss Elon Musk has recently proposed expanding its manufacturing facility in China.
Tesla Evaluating the Situation in the U.S.
With the rising number of coronavirus cases in the U.S, Tesla is currently evaluating the situation at hand. California officials said that Tesla’s manufacturing facility in San Francisco can continue its operations as of now.
Speaking to the Wall Street Journal, a county spokesperson said Tesla doesn’t need to shut down its Fremont factory. However, other “non-essential” businesses have been asked to shut their shop. The county order arrived Monday asking people to stay at home in this pandemic situation. Only essential businesses and suppliers like pharmacies and grocers can stay open.
Tesla’s Fremont factory currently employees around 10,000 employees currently. In an email to employees this Monday, Elon Musk wrote: “If you feel the slightest bit ill or even uncomfortable, please do not feel obligated to come to work.”
Speaking of the overall situation, Elon Musk thinks that panic is much more than the virus threat itself. “My frank opinion is that the harm from the coronavirus panic far exceeds that of the virus itself,” said the Tesla boss. Besides, Elon Musk is also planning to open a Tesla gigafactory in the central U.S. for its Cybertruck and Model Y production.