Tesla, Inc. enthusiasts (TSLA) Cybertruck has to wait longer to get its hands on the vehicle. The company reportedly doesn’t plan to start producing the truck until 2022. When the vehicle was unveiled in 2019, it had promised delivery towards the end of 2021.
The central theses
- Tesla has postponed production of its Cybertruck, which was originally planned for late 2021, to 2022.
- Possible reasons for the delay include the Model Y’s production priorities and manufacturing difficulties in implementing its design.
- The electric vehicle will enter a crowded market made up of vehicles from startups and established companies.
- Tesla also received a rating upgrade from an analyst.
Tesla has a lot of design and Supply chain Subjects. For example, Tesla CEO Elon Musk warned in January that new manufacturing processes for the truck’s steel exoskeleton could delay delivery. Microchip and resource shortages due to the pandemic have also affected the company’s planning for its new Austin, Texas facility. Production of the Cybertruck was scheduled to begin at Tesla’s Austin facility earlier this year, but CEO Musk has indicated that when the plant is complete, production of the Model Y will take precedence over production of the Cybertruck.
The Cybertruck had a high profile launch in 2019 when its futuristic and brutalist look with sharp and edgy lines polarized public opinion. It also made headlines when the company’s chief designer, Franz von Holzhausen, smashed the window glass with a steel ball. Moments earlier, CEO Musk had been boasting about the vehicle’s “bulletproof” glass.
Cybertruck’s postponement comes as no big surprise to those who follow the company. Tesla has been suggesting a delay for several months. Plus, it has a history of missed deadlines and its ambitious agenda is littered with failures and mistakes in its manufacturing schedules. CEO Musk also hinted a possible mistake for the truck at the beginning of the year.
A crowded market
When it hits the market, the cybertruck will enter a crowded market. Ford Motor Company (F.) plans to launch an all-electric version of its best-selling Ford F-150 by spring 2022. General Motors Company (GM) has started work on an electric version of its Chevy Silverado and is slated to hit the market in 2024. The Ram 1500 will also be launched in the same year. Electric truck startups are also snapping on Tesla’s heels. Rivian, a Michigan-based electric start-up, plans to launch its electric truck this September.
Tesla has received over 1 million reservations for the Cybertruck since launch. It should be noted, however, that reservations do not always result in a sale as the amount reserved to book a Tesla Cybertruck is nominally $ 100 and fully refundable.
A rating upgrade
Meanwhile, Jefferies analyst Philippe Houchois has upgraded his Tesla share rating to buy from hold. He also increased his Course target on Tesla shares from $ 700 to $ 850 and writes that the company will benefit from increasing global demand for battery electric vehicles (BEV) as well as more battery and assembly capacity.
He said that Tesla stock, which is down nearly 20% from its January high, has seen corrections as the market adjusted its initially enthusiastic expectations for the company’s business, including shipments and growth in the company Storage business that were inflated. But the company’s “product complexity, inventory levels, direct sales, and subscription service initiatives” were reasons to be bullish on the stock.