Elen Musk, co-founder and Chief Executive Officer of Tesla Inc., will speak on Friday, March 15, 2019, during a launch event for the Tesla Model Y crossover electric vehicle in Hawthorne, California, USA.
Patrick T. Fallon | Bloomberg | Getty Images
Tesla's recent move to raise money may reassure some bears, but Elon Musk, the head of autonomous to a focus on autonomy, may unsettle an important group of investors who rely on the company one day becoming a profitable carmaker.
Musk called on Wall Street to raise $ 2.7 billion in stock and bond offerings, leading to a relief rally in its stock, which fought over its disappointing productions and legal difficulties.
However, due to an investor call hosted by the subscribers to the deal, Musk's tune addresses Tesla's self-drive strategy from the beginning, confidently saying that autonomous driving will transform Tesla into a $ 500 billion market capitalization company.
"The argument for a trillion dollar market capitalization was essentially geared to high-volume, high-profit car sales, and now it's all about autonomy," Barclays auto analyst Brian Johnson said in a statement Tuesday. "Tesla [is] seems to commute from auto profits to autonomy gains."
The Pivot on Autonomy means growth investors will have to wait longer for a payout, Johnson notes. The so-called "rational bulls" typically seen by large institutional investors with growth mandates believed that "Tesla will be a multiproduct automaker with its light range of vehicles over the next five to seven years," Johnson said.
Musk launched the idea of Robo-Taxis on April 22 at the company's Investor Day. Tesla will be able to offer robotic taxis next year and will be producing cars without steering wheels or pedals in two years' time.
Barclays Tesla is underweight, with a target price of 1
"We believe the attractiveness of the Tesla share may slow for growth investors," said Johnson. "Some of the rational bulls may need to reconsider the idea that Tesla will become a profitable car market."
Tesla's shares have recently rallied through stock and bond offerings, but have still fallen 23% this year
– With reports by Michael Bloom