Tesla’s strong earnings ‘raises more questions’ about future lineup: Deutsche Bank

2024.04.26 3 min read

Tesla’s strong Earnings Call earlier this week has certainly won over some investors as the stock continues to climb upward, but analysts at Deutsche Bank believe the call might have raised more questions as the company clarified its plans for the future.

“The strong positive market reaction to Tesla’s mixed Q1 print, in our view, represented some relief that Tesla is not completely giving up on selling cheaper consumer models, nor is it staking the company’s entire future on Robotaxi,” Deutsche Bank said in a new note to investors.

However, there is some skepticism among the analysts regarding what the new vehicle lineup might entail, especially in terms of pricing and detail, which will undoubtedly be revealed at a future date.

Tesla gives first look at Robotaxi-powered ride-hailing service app

The clarification on what is to come undoubtedly brings more transparency into what Tesla’s plans are for the next year and a half. However, Deutsche Bank said the lack of concrete information “leaves large unanswered questions around the detail and cost of the new vehicles and creates considerable execution risk considering the aggressive timeline, as well as risk of Model 3/Y cannibalization if differentiation is small.”

There are reasons for the lack of detail, and it all comes down to what a business is about. Tesla has always been relatively cryptic regarding what it will release, and there are chances the engineers and CEO Elon Musk have not come up with a finalized design or roadmap for these vehicles, which ones will be released, and at what price.

Tesla has routinely adjusted prices to stimulate demand, and changes occur too often to narrow down models to a specific price. After all, look what happened with Cybertruck.

Tesla will release the details of its upcoming lineup when things are more finalized, and although there are more questions, what we got was better than a lack of guidance or concrete plans, like what happened with Q4 earnings.

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