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Media skeptics pile on Tesla as stock enters the slow lane

Tesla Model S Rain

Updated 12/19/14 12:50 pm EST to include today’s tweet from Elon Musk’s regarding battery-swap stations.

Predictions are a dime a dozen (and so are alliterative clichés), but here are two that always seem to come true: any time the price of a headline stock goes down, media pundits start chiming in with “I told you so” stories; every time gas prices make a major move up or down, media pundits (and many car buyers) assume that the new price level is permanent.

Tesla’s stock has been in a funk lately – after trading around 250 in the wake of November’s earnings report, it fell in lockstep with gas prices, even dipping a toe below its support level of 200 this week. (We doubt that many Model S customers base their buying decisions on gas prices, but we’re sure that many of the dilettantes who dabble in TSLA stock do.)

So, here comes the latest crop of Tesla-skeptic articles. Morgan Stanley automotive analyst Adam Jonas wrote this week that he thinks cheaper gas will cause Tesla to miss its 2020 delivery target by 40%. “While nobody buying a Model S today is doing so to save on their monthly expenses, the longer-term story is far more dependent on the volume success of the Model 3,” quoth he. Jonas also predicts that Model 3 will end up selling for between $55,000 and $60,000, rather than the $35,000 foreseen by Musk’s master plan.

MORE: Tesla confident that Gigafactory can hit the magic number: $100/kWh

Mr Jonas’s crystal ball must be powerful indeed if he can see what gas prices, and Tesla’s fortunes, will look like six years from now. And, like a number of other stock analysts, he plainly hasn’t read (or doesn’t believe) Musk’s many musings on his three-phase plan to electrify the world, where he insists the Model 3 will go on sale at the target price, or not at all.

While Jonas has lowered his price target for TSLA, he still rates the stock a buy.

Damon Lavrinc of Jalopnik asks the automotive question, What will Tesla overpromise next? He huffs indignantly that promised goodies such as battery-swapping, solar-powered Superchargers and a Roadster upgrade don’t seem to be under the tree this Christmas.

Mr Lavrinc does have a point, but it’s very old news. As he himself points out, Musk and Tesla have always set overly optimistic timetables (and so, from time to time, have other automakers). The Roadster missed its announced delivery date by months, held up by transmission troubles. Model S, which the company originally planned to launch in 2009, hit the road in 2012. Model X’s delivery date has been pushed back several times – as rumor has it, because of difficulties with the Falcon Wing doors. Even among ardent Teslophiles, few expect Model 3 to go on sale in 2017 as planned.

SEE ALSO: Elon Musk says the Model X is a harder design problem but worth the wait

But here’s the important point: every one of those delays was caused because the company took extra time to get the car just right. Musk has said many times that he’d rather be late to market than offer a substandard product. Model S was late, but Model S is a superlative automobile (at least according to Consumer Reports, the NHTSA and every mainstream automotive magazine).

The list of brilliant, game-changing innovations that Tesla has delivered is quite long, so I think we can excuse the fact that some other promised wonders remain on hold. Every company has to prioritize, and what with ramping up production, opening new markets for Model S, getting Model X out the door, expanding the Supercharger network and getting the Gigafactory rolling, the Tesla crew will have a pretty full plate for the foreseeable future.

However, that doesn’t mean that the lesser projects have been forgotten. As if to thumb its corporate nose at the naysayers, Tesla has just announced that its first battery-swapping station is now operational. 

 

Sources: Greentech Media, Jalopnik

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