Tesla CEO Elon Musk has a mixed history when it comes to deadlines, but he beat a major one this week in Australia. On Friday, Tesla Inc (Nasdaq: TSLA) will bring a massive 100-megawatt battery storage facility online near Adelaide just 100 days after signing a contract to do so.
Musk created the 100-day deadline when he promised Tesla could help alleviate Australia’s blackout problems earlier this year in a post on Twitter.
“Tesla will get the system installed and working 100 days from contract signature or it is free,” Musk said on March 9.
The official contract for the battery was not signed until the end of September, leaving Dec. 1 as the 100-day mark.
But while headlines about the record-breaking battery are a positive for Tesla, investors have been more concerned with Tesla missing deadlines on Model 3 production. Tesla stock is down 13.9 percent in the past three months after the company missed its Model 3 delivery targets in the second half of the year due to what the company said was a “production bottleneck.”
In the meantime, Tesla burned through another $1.1 billion in cash in the third quarter, and competitor General Motors Co. (GM) has gotten high praise from Wall Street of late for its autonomous vehicle technology. Tesla’s lofty market valuation, its long (and growing) list of expensive projects and the lack of clarity on its Model 3 production ramp have some analysts recommending that investors stay away from Tesla stock for now.
“While we believe TSLA has the potential to become a transformative technology company and deliver outsized returns for investors, the company’s pace of growth, recent questionable decisions around capital allocation and lack of disclosure keep us on the sidelines,” Oppenheimer analyst Colin Rusch says.
Other analysts believe Tesla’s battery business is key to its ultimate Model 3 success.
“If TSLA is unable to significantly reduce battery costs through economies of scale or technological advances, it may prove challenging to produce vehicles at the $35,000 price point without reductions in performance,” Baird analyst Ben Kallo says.
Tesla’s title as producer of the world’s largest battery is…
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