Yahoo Finance Tesla Delays Truck Unveiling to Focus on Model 3 Issues
Tesla, Inc. TSLA has deferred the unveiling of its semi-truck, Tesla Semi, to Nov 16, per an Autoblog report. This is the second time that the automaker has rescheduled the unveiling of the truck. The company’s increased focus on mending production problems linked to Model 3 and raise battery production for hurricane-affected Puerto Rico, can be attributed to this delay.
Notably, the Palo Alto, CA-based automaker has fallen short of its third-quarter 2017 production target of the new Model 3 sedan. During the quarter, the company delivered 220 Model 3s and produced 260, missing the production target of 1,500. This indicates that production has not been as smooth as anticipated. Importantly, the Model 3 could catapult Tesla to become a mass market producer. However, Tesla reported that production bottlenecks came in the way of ramping-up production of Model 3 (read more: Tesla Fails to Meet Production Target of Model 3).
Per Wall Street Journal, parts of Model 3 were being manufactured by hand. In fact, production of the advanced assembly line, promised by Tesla, is yet to be ready, hampering its production target badly. Moreover, not only the Model 3 production but also the quality of the vehicles will also play a significant role in Tesla’s success.
In the last six months, Tesla’s shares have underperformed the industry it belongs to. Shares of the company have increased 14.3%, while the industry has grown 15.7%.
Currently, Tesla has a Zacks Rank #3 (Hold).
A few better-ranked stocks in the auto space are Toyota Motor Corporation TM, Cummins Inc. CMI and Daimler AG DDAIF. Toyota sports a Zacks Rank #1 (Strong Buy), while Cummins and Daimler hold a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Toyota has an expected long-term earnings growth rate of 7%.
Cummins has an expected long-term earnings growth rate of 12%.
Daimler has an expected long-term earnings growth rate of 2.8%.
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