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TSLA Stock Slightly Up in Pre-market, Battery Cell Constraints Might Affect Tesla Semi Launch

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by Steve Muchoki · 3 min read
TSLA Stock Slightly Up in Pre-market, Battery Cell Constraints Might Affect Tesla Semi Launch
Photo: Depositphotos

Tesla stock has now been trapped in a multi-week correction after rallying over 500% last year. 

Tesla Inc (NASDAQ: TSLA) stock closed Friday trading at $618.71, down 3.39%. Meanwhile, Tesla stock has dropped nearly 1% further during the pre-market trading session according to MarketWatch. At the time of writing, TSLA stock is 0.16% up. The dip in TSLA stock coincided with a revelation from CEO Elon Musk that the company is experiencing battery cell constraints that might affect Tesla Semi launch and production.

Tesla stock has now been trapped in a multi-week correction after rallying over 500% last year. Metrics provided by MarketWatch indicates Tesla stocks are down 12.32%, 13.88%, and 7.66% in the past three months, one month, and five days respectively through Friday. However, the company’s market capitalization still remains above $500 billion and among the most valuable automakers.

In the past 52 weeks, Tesla stocks experienced heightened volatility as they traded between $89.29 and $900.40. Wall Street analysts are not sure what to expect from Tesla in the coming quarters. Consequently, a survey conducted by MarketWatch indicates Tesla stocks received an average of Hold ratings from 34 ratings.

Tesla stock has, however, rallied against all odds defying analysts’ expectations. Being a technology-based company, Tesla has the infrastructure in place to handle opportunities especially delivered by the pandemic.

Musk remains positive that the company will become the most valuable company in the world in the near future. “I think there is a [greater than] 0% chance Tesla could be the biggest company,” the CEO tweeted Friday, referring to the potential for his company’s full self-driving software to create new stock market value “probably within a few months.”

Tesla Stock and the Semi Truck Segment

In a bid to diversify its earnings, Tesla has over the years introduced new products in the market. One of the highly anticipated products has been the Tesla Semi truck. The all-electric Semi truck is expected to revolutionize the trucking industry by improving efficiency and profitability margin.

However, the Tesla Semi truck has been delayed over the year since 2019 due to technical challenges. According to Musk, the Semi’s production and launch date remain pegged to the battery cell production.

Currently, the company is experiencing a shortage in battery cell production both from its internal and external sources. Musk recently confirmed this through his Twitter page after one of his followers asked him about the Semis.

Currently, Tesla is producing 4680 cells at its pilot plant in the Fremont factory. However, plans are underway to scale the production at its Gigafactory located in Texas.

The Plaid Plus S Tesla model is also expected to be delayed due to the same reason as it uses the same battery pack as the Semis.

Tesla investors and analysts will closely be monitoring the happenings in the company to understand when to expect the semi truck and Plaid Plus S model to boost the stock market.

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Steve Muchoki

A financial analyst who sees positive income in both directions of the market (bulls & bears). Bitcoin is my crypto safe haven, free from government conspiracies. Mythology is my mystery! "You cannot enslave a mind that knows itself. That values itself. That understands itself."

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