TSLA Stock Down 1% Now as Tesla Increases Prices of Its Model 3 and Model Y

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by Bhushan Akolkar · 3 min read
TSLA Stock Down 1% Now as Tesla Increases Prices of Its Model 3 and Model Y
Photo: Tesla / Twitter

Citing massive demand for its popular models, Tesla has updated the prices for its Model 3 and Model Y. However, the immediate concern in short term is that it has very little inventory at this point.

On Thursday, April 8, TSLA stock price was up 1.91% trading at $683 with a market cap of $656 billion. The price uptick comes as Wall street cheers Tesla Inc (NASDAQ: TSLA) updating the prices of its Model 3 and Model Y. However, it is not something major but a minor price update. At the time of writing, TSLA is down 0.95%, trading at $677.32.

Tesla Model 3 and Model Y Prices

As per Tesla official website, the Model 3 Standard Range Plus has got a $500 price increase from $37,990 to $38,490. Additionally, the Model 3 Long Range Dual Motor AWD also gets a $500 price surge. Furthermore, the Model 3 Performance which is the top-of-the-line variant of the all-electric sedan gets a $1000 increase with the updated pricing starting at $56,990.

For its Model Y, the company has also adjusted the Long Range Dual Motor AWD variant’s price by $500. Thus, the variant now starts at updated pricing of $50,490. These two variants from Tesla have received price updates multiple times over the last few months.

The pricing update comes on the backdrop of a massive demand surge for its cars. Recently, Tesla released its Q1 2021 results beating Street estimates by a very comfortable margin. The company delivered 5000 more vehicles during the first quarter than the estimated figure. Market analysts have also updated their targets for TSLA stock.

As per the recent article from The Street Tesla’s inventory is currently sitting only at a nine-day supply. Usually, the traditional automakers sit at around 60-80 days of inventory. The article notes:

“With such low inventory, Tesla could be raising prices to better balance supply and demand, or the changes could be a result of increasing costs for the automaker as supply chains issues persist in the automotive industry”.

Morgan Stanley: Tesla Is a ‘Must-Own’ Stock

During a recent interview with Bloomberg Markets, Morgan Stanley analyst Adam Jonas explained why he feels Tesla is a ‘must-own stock as on date. The analyst points out some key benefits that Tesla enjoys in the electric mobility sector. The analyst also mentions that investors are at a bigger risk if they don’t own any Tesla stock. Jona feels that owning a TSLA is akin to owning insurance in the EV sector.

“We think it’s a must-own (stock). And I say that because we frequently speak with investors that say, ‘Adam, I want to put together a long-term EV or AV exposed portfolio, but I’ll never own TSLA.’ We kind of take a deep breath and say, ‘Well then, you run the risk of not owning the company that could make all the other stuff you do own completely obsolete,’” he said.

Jonas believes that Tesla’s lead in the electric mobility sector won’t be matched by its competitors. “Tesla has zero internal combustion entanglement and is in a position to, you know, attract capital and talent perhaps more efficiently… Sure, there’s lots of legacy companies, they’re all, if you listen to what they’re saying, they all sound like they’re Tesla. And in many ways, they’re frankly obsessed with Tesla. If you listen to 30 seconds of Volkswagen of GM, you’d think they didn’t sell any internal combustion cars. It turns out they sell 98%,” the Morgan Stanley analyst said.

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