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TSLA Stock Sheds Over 11% as Tesla Announces No Plans to Produce New Models in 2022

UTC by Ibukun Ogundare · 3 min read
TSLA Stock Sheds Over 11% as Tesla Announces No Plans to Produce New Models in 2022
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In addition to the most recent decline, TSLA has dropped more than 21% since the year started.

Shares of EV maker Tesla Inc (NASDAQ: TSLA) fell over 11% during trading hours on the 27th of January after the automaker said it would not roll out new model vehicles in 2022. The automaker also added that it has not started working on the highly anticipated $25,000 EV. Tesla CEO Elon Musk informed stakeholders of the plan not to produce a new model this year and the current status of the $25,000 electric car. Musk explained to inventors during a 2021 Q4 earnings call after trading closed on the 26th of January. In addition, the CEO mentioned that Tesla still suffers from the ongoing chip shortage, noting that the shortage may last through the year. 

On the other hand, investors had expected that Tesla would manufacture and begin to deliver new models in 2022. Some shareholders hoped that Tesla would start to deliver the Cybertruck, while some hoped that the EV maker would unveil the heavy duty truck Semi, which it announced in November 2017. 

Instead, Tesla said it would be focusing on improving the production of existing models at its old and new factories. Also, the EV company plans to scale up its driver-assistance technology, full self-driving, and more. Tesla’s revelation that it has not started working on the $25,000 EV has raised questions from analysts like Toni Sacconaghi. Sacconaghi, a senior analyst at Bernstein, queried Tesla’s executives during the 2021 Q4 earnings call. He asked:

“If there is no $25,000 vehicle being worked on, is it really realistic to think that you can sell more than 3 million vehicles with two very high volume cars and Cybertruck in 2024?”

In response, Musk said:

“I mean, it is apparent from the questions that the gravity of Full Self-Driving is not fully appreciated.”

Tesla Plans to Invest in Humanoid Robot in 2022

Part of the plans Tesla has for 2022 is to invest in the research and development of humanoid robots. The automaker wants to infuse mode in developing robots that can work in its factories.

“The most important product development we’re doing this year is actually Optimus humanoid robot. This, I think, has the potential to be more significant than the vehicle business over time,” said Musk.

Speaking further, the CEO said there is a need to advance Tesla’s driverless technology. According to the Tesla CEO, an advanced tech will fuel the company’s sales volume in 2022. He added that sales volume will surge whether or not there are new models.

Despite the company’s premium system, Tesla cars are currently not considered driverless. The EV maker said its systems are in the Level 2 category, which means that the vehicles do not qualify for the “SAE Level 4” standard that serves as a yardstick in categorizing driving with no human intervention.

In addition to the most recent decline, TSLA has dropped more than 21% since the year started. Despite the losses, analysts are bullish on Tesla stock for 2022 and confident in its leadership position in the EV market. Analysts at Deutsche Bank and Goldman Sachs are reiterating a buy rating on TSLA and a price target of $1,200. At press time, Tesla stock is up 0.95% to $837. 

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Ibukun Ogundare

Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience. Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.

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