On June 5, Tesla (TSLA) held its annual shareholder meeting in Mountain View, California. During the meeting, CEO Elon Musk informed investors about the company’s existing position and future plans. Annual shareholder meetings have largely been an opportunity for Tesla bulls to regain confidence. In 2017, Tesla stock rallied for two consecutive days after its shareholder meeting on June 6.
During the 2018 annual shareholder meeting, Musk revealed that all of the Model 3 production lines demonstrated the ability to produce 500 cars per day or 3,500 car units per week. Musk added that the company will likely hit its Model 3 production goal of 5,000 units per week by the end of June. After the announcement, Tesla stock rallied nearly 10% on June 6, as we discussed in the previous part.
Musk claimed that Model 3 was the top-selling mid-size premium sedan in the United States in May. He suggested that Model 3’s quality has improved significantly in recent months. The number of cars in service have decreased with rising deliveries.
During his presentation at the event, Musk also reassured investors that Tesla doesn’t expect “to raise any incremental debt or equity” this year.
Notably, Tesla’s Model 3 production concerns have hurt investors’ confidence, which gave Tesla bears a reason to celebrate in the last three quarters. While Tesla stock has been able to showcase strength after its 2018 annual shareholder event, its near-term movement still depends on the company’s ability to achieve its second-quarter Model 3 production goals.
In the last few years, other auto giants (XLY) like General Motors (GM), Ford (F), and Fiat Chrysler (FCAU) have raised their bets on electric vehicles. These companies have set ambitious targets for electric vehicle production in the next few years.