Automakers Face Challenges as EV Investments Plummet
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
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Source: Newsfilter
- Investment Decline: According to Atlas Public Policy, automakers and battery manufacturers have invested over $200 billion in EV and battery manufacturing facilities in the U.S. since 2000, with about 40% concentrated in the South; however, as EV sales plummet, many companies have canceled plans, leaving the investment outlook uncertain.
- Hyundai's Transformation: Hyundai Motor Group's $12.6 billion EV factory in Georgia was expected to create 8,500 jobs by 2031, but following the removal of federal incentives, EV sales dropped 50% in Q4, prompting the company to announce an additional $2.7 billion investment to increase production and shift towards a mix of hybrids and EVs.
- Massive Write-Downs Expected: John Murphy of Haig Partners estimates that U.S. automakers may face at least $100 billion in write-downs on EV investments, with Ford and GM already announcing charges of $19.5 billion and $7.6 billion respectively, highlighting the high risks associated with EV investments.
- Market Forecast Adjustments: The Biden administration initially aimed for 50% of new car sales to be EVs by 2030, but this target has been revised down to 17%, affecting Bosch's $250 million investment in South Carolina, which now requires adjustments to production plans to align with the shifting market demands.
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Analyst Views on TSLA
Wall Street analysts forecast TSLA stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for TSLA is 401.93 USD with a low forecast of 25.28 USD and a high forecast of 600.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
30 Analyst Rating
12 Buy
11 Hold
7 Sell
Hold
Current: 416.560
Low
25.28
Averages
401.93
High
600.00
Current: 416.560
Low
25.28
Averages
401.93
High
600.00
About TSLA
Tesla, Inc. designs, develops, manufactures, sells and leases high-performance fully electric vehicles and energy generation and storage systems, and offers services related to its products. Its segments include automotive, and energy generation and storage. The automotive segment includes the design, development, manufacturing, sales and leasing of high-performance fully electric vehicles, and sales of automotive regulatory credits. It also includes sales of used vehicles, non-warranty maintenance services and collisions, part sales, paid supercharging, insurance services revenue and retail merchandise sales. The energy generation and storage segment include the design, manufacture, installation, sales and leasing of solar energy generation and energy storage products and related services and sales of solar energy systems incentives. Its consumer vehicles include the Model 3, Y, S, X and Cybertruck. Its lithium-ion battery energy storage products include Powerwall and Megapack.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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