What happened
Shares of Tesla (NASDAQ:TSLA) raced out of the gate Wednesday morning, climbing 2.3% in the first couple minutes of trading before beginning to fall back.
But don’t be disappointed that Tesla is giving back some of its gains today — the long-term news about this growth stock looks propitious.
So what
Tesla’s first big pop seems to have been sparked by a bit of corporate theater. In an apparent poke at the phenomenon of whistleblowers trying to embarrass their bosses, Elon Musk tweeted last night that Tesla is now selling a “limited-edition Cyberwhistle” shaped like its still-unavailable Cybertruck.
Then poking further fun at rumors that Apple (NASDAQ:AAPL) is trying to build an electric car, he added: “Don’t waste your money on that silly Apple Cloth, buy our whistle instead!”
Very funny, Elon. Tesla investors rushed to get in on the joke, but apparently decided that a joke isn’t necessarily the best reason to splash down $1,150 or more on a share of Tesla stock, and just as quickly as it went up, Tesla stock started going back down again.
Now what
But wait! There’s more! In a more significant development today, Reuters is reporting that the CEO of Tesla rival Stellantis (NYSE:STLA) is not at all certain that his company — or any company — can profitably compete with Tesla in EVs.
The costs of transitioning from gas-powered cars to electrics are “beyond the limit” of what car makers or car buyers can pay, warns Stellantis CEO Carlos Tavares. Building an EV costs Stellantis 50% more than building a “conventional vehicle,” laments the CEO. And “there is no way we can transfer 50% of additional costs to the final consumer because most parts of the middle class will not be able to pay.”
It might be more accurate, though, to say consumers won’t pay 50% more for an EV built by Stellantis. Because with Tesla sales up 57% last quarter (and profits up 389%), Tesla seems to have no problem at all selling electric cars.