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Before 2023, skeptics believed Tesla faced declining demand and rising competition. However, Musk surprised everyone by globally lowering prices, particularly in China, to boost sales. Now, Tesla is expected to reach an impressive 1.8 million units sold in 2023.
Investors are debating Tesla’s future, especially regarding price reductions and the company’s trajectory in 2024, with margins being a crucial concern. Analysts at Wedbush see indications that margins have likely steadied and are poised to increase from current levels. They anticipate the company’s Automotive Gross Margin to surpass the critical 20% mark again sometime in 2024.
Despite lingering safety concerns, Tesla’s Full Self-Driving (FSD) capabilities are gaining momentum in the market. Wedbush sees this as an additional factor contributing to TSLA’s growth story in 2024. The integration of AI is expected to introduce further growth opportunities to Tesla’s already extensive product lineup.
“The “golden vision” at Tesla is now monetizing its super charger network with batteries and AI/FSD next adding to the sum-of-the-parts story for Tesla.” Wrote analysts at Wedbush in a note.
Analysts at Wedbush project that Tesla’s Full Self-Driving (FSD) capabilities and the Supercharger network could add an additional $75 per share to Tesla’s story in the next 12 to 18 months. They anticipate that the market will begin considering this factor as Tesla progresses in executing its strategic vision, entering the next phase of its growth narrative.
“We view Tesla where Apple was in the 2008/2009 period as Cupertino was just starting to monetize its services and golden ecosystem with the Street not seeing the broader golden vision at the time.” Wedbush added.
Shares of TSLA are up 0.88% in pre-market trading on Friday.
