March 01, 2019
Teslas just got cheaper — and so did the company’s stock.
Shares of the electric-car maker tumbled almost 8 percent Friday after Elon Musk unveiled a long-awaited version of the company’s mass-market Model 3 sedan that costs just $35,000.
Tesla stock tanks after Elon Musk unveils cheaper Model 3
Musk, who previously had been charging north of $42,000 for the cheapest Model 3, likewise slashed prices on the Model S and Model X — including an $18,000 price drop for the models in Ludicrous mode.
But to pay for the discounts, Musk said late Thursday, Tesla will be shuttering most of its stores, laying off employees and moving worldwide sales exclusively online.
That, coupled with Tesla backtracking on a promise to deliver a profit during the current quarter, left Wall Street less enthusiastic about the Model 3’s chances to go mainstream — and more worried about margins and slackening demand.
“We think they’re having issues moving vehicles, and they’re experiencing inventory build,” Garrett Nelson, an analyst at CFRA Research, told The Post.
“It’s almost like they’re desperate, like their sales have fallen so much that they’re doing anything to prop up demand.”
DA Davidson analyst Tom Forte noted that investors are also spooked about Tesla’s debt. It paid off a $920 million chunk in cash on Friday — pointing out that the budget Model 3 has much smaller margins than its high-end vehicles.
“Longer term, an argument can be made that there’s some concerns about their ability to fund their debt if they can’t maintain profitability,” Forte said. “They’re going from earning $1.93 last quarter to a loss this quarter. Their profitability issues could very well go beyond this quarter.”
Nelson speculated that the earlier-than-expected arrival of the $35,000 Model 3 might be related to Musk’s scrap with the Securities and Exchange Commission. Earlier this week, the SEC demanded Musk be held in contempt of court for a tweet about Tesla production numbers the watchdog deemed misleading.
Indeed, only hours after the Model 3 announcement, Musk revealed in a court filing that he had brought on former Enron prosecutor John Hueston to his legal team.
Columbia Law School professor John Coffee told The Post that he does not see Musk’s legal team’s shake-up as an admission of concern over the SEC, but rather a reflection of his personality. “It sounds to me consistent with what he usually does, which is change everything every 72 hours,” Coffee said.
Tesla shares finished the day down 7.8 percent, at $294.79.
Related Stories
Latest News
Top news around the world
Coronavirus Disease

Coronavirus disease (COVID-19) is an infectious disease caused by a newly discovered coronavirus.

Most people infected with the COVID-19 virus will experience mild to moderate respiratory illness and recover without requiring special treatment. Older people, and those with underlying medical problems like cardiovascular disease, diabetes, chronic respiratory disease, and cancer are more likely to develop serious illness.

Around the World

Celebrity News

> Latest News in Media

Watch It
Ezra Miller Under Fire for Allegedly Choking a Woman | E! News
April 06, 2020
qFs4x3CGzwM
Pink Recalls Her "Roller-Coaster" Experience With Coronavirus | E! News
April 06, 2020
dn4YUn0Quk4
Blake Shelton Pokes Fun at Himself: "Say Stace Everybody" | E! News
April 06, 2020
dYuR1n20hP0
'Westworld' Stars Evan Rachel Wood & Tessa Thompson on Their Collaboration in Season 3
April 06, 2020
UHCoQJUjM5A
Ed Helms talks 'Coffee and Kareem'
April 06, 2020
sbQzbJE8V_o
'Coffee & Kareem' Star Ed Helms' Shows Off His Gene Autry Guitar
April 06, 2020
aTV0WckKWJI
Peter Weber could date Kelley Flanagan or Charlize Theron next | Page Six Celebrity News
April 06, 2020
oWQ4k_icwj8
Teresa Giudice's dad's best moments on 'The Real Housewives of New Jersey' | Page Six Celebrity News
April 06, 2020
ITmtQAWrO0Y
Nikki and Brie Bella take us inside their closets, talk pregnancy style | Page Six Celebrity News
April 01, 2020
T9art86o6FI
Big & Rich Get the 'Stay Home' Point Across with New Song | TMZ
April 06, 2020
D_EGl1aJ32U
Quibi's Jeffrey Katzenberg Explains How New Service is a Game Changer | TMZ
April 06, 2020
N6QTsQVNxL4
L.A. Beachgoers & Hikers Hit the Sand, Trails Despite Beach Closures | TMZ
April 04, 2020
JtcY523mXRE
TV Schedule
Late Night Show
Watch the latest shows of U.S. top comedians

Sports

Latest sport results, news, videos, interviews and comments
Latest Events
08
Mar
ITALY: Serie A
Juventus - Inter Milan
08
Mar
ENGLAND: Premier League
Manchester United - Manchester City
08
Mar
ENGLAND: Premier League
Chelsea - Everton
08
Mar
SPAIN: La Liga
Real Betis - Real Madrid
08
Mar
ITALY: Serie A
AC Milan - Genoa
07
Mar
ENGLAND: Premier League
Burnley - Tottenham Hotspur
07
Mar
ENGLAND: Premier League
Arsenal - West Ham United
07
Mar
SPAIN: La Liga
Barcelona - Real Sociedad
07
Mar
ENGLAND: Premier League
Liverpool - Bournemouth
07
Mar
SPAIN: La Liga
Atletico Madrid - Sevilla
01
Mar
SPAIN: La Liga
Real Madrid - Barcelona
01
Mar
ENGLAND: Premier League
Everton - Manchester United
01
Mar
ENGLAND: Premier League
Tottenham Hotspur - Wolves
01
Mar
SPAIN: La Liga
Espanyol - Atletico Madrid
01
Mar
ITALY: Serie A
Cagliari - Roma
29
Feb
ENGLAND: Premier League
Watford - Liverpool
29
Feb
ITALY: Serie A
Napoli - Torino
29
Feb
ENGLAND: Premier League
Bournemouth - Chelsea
24
Feb
ENGLAND: Premier League
Liverpool - West Ham United
23
Feb
ENGLAND: Premier League
Arsenal - Everton
23
Feb
ENGLAND: Premier League
Manchester United - Watford
23
Feb
ITALY: Serie A
Roma - Lecce
23
Feb
SPAIN: La Liga
Atletico Madrid - Villarreal
22
Feb
SPAIN: La Liga
Levante - Real Madrid
22
Feb
ITALY: Serie A
Fiorentina - AC Milan
22
Feb
ENGLAND: Premier League
Leicester City - Manchester City
22
Feb
ITALY: Serie A
Spal - Juventus
Find us on Instagram
at @feedimo to stay up to date with the latest.
Featured Video You Might Like
W3y9zuI_F64 -7qCxIccihU pQ9gcOoH9R8 g5MRDEXRk4k tudKp5Vhs3k iwWHibhssSo kQr0XHPbICM 5NeCb7JxaRk u5xQKdNqazE 56CdjlzJqSA kw7uFRs-Az0 xNv0JZWLV7w
Copyright © 2020 Feedimo. All Rights Reserved.