Tesla (TSLA) is abandoning plans for a version of Tesla’s Plaid Plus version of the Model S, according to a tweet on Sunday from CEO Elon Musk. Tesla shares rose higher for a small profit.
The car was expected to sell in about a year and cost nearly $ 150,000. Tesla still plans to produce a plaid version of the car, which is about $ 30,000 cheaper. The company is holding a Model S Plaid delivery event on June 10, following a month-long delay in Model S deliveries amid an extended transformation.
Tesla CEO Musk tweeted that Plaid + is being canceled because “there is no need because Plaid is just so good.”
“This is not the news the street wanted to hear,” Wedbush analyst Daniel Ives said in an email to IBD. “On the surface, the apology makes sense, but it also feels like the dog has eaten the homework.”
If the battery problems are to blame for not producing the Model S Plaid Plus, Tesla’s Cybertruck and Semi plans don’t look promising. Musk also said the same 4,680 cells would be used in some Model Y crossovers.
Musk had boasted that the Plaid + could travel more than 500 miles on a single charge, compared to the standard version of the Plaid, which would be designed to travel 390 miles.
This extended range would entitle it to boast the high-end Lucid Air, manufactured by Lucid Motors, with a top-of-the-range range of 517 miles.
Lucid Motors is run by former Tesla chief engineer Peter Rawlinson. The startup is due to deliver its first EV, the luxury Lucid Air sedan, later this year. The original Dream Edition will cost $ 169,000 and will drive 503 miles on a single charge.
On February 23, the Special Purpose Acquisition Company (SPAC) Churchill Capital Corp IV (CCIV) announced that it was exporting Lucid publicly in a deal that valued Lucid at $ 24 billion. Lucid will trade under the LCID symbol. The deal is expected to close at the end of the second quarter.
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Shares rose 1% to 604.13 on the stock market today, recovering from an intraday low of 582.88 to close pennies below their 200-day moving average. Analysis of the MarketSmith chart shows that Tesla shares fell below its 200-day line last week. The shares are about 35% below their record level of 900.40, reached on January 25.
Tesla’s line of relative strength has narrowed. The RS rating is 89 out of a possible 99, while the EPS rating is 74.
Meanwhile, CCIV stocks jumped nearly 11%.
Among car manufacturers with a growing number of electric cars, General Motors (GM) decreased by 0.2% and Ford (F) 0.7%. Volkswagen (VWAGY) rose 1.9%.
China-based Tesla rivals Nio (NIO) increased by 4.15%, Xpeng (XPEV) rose 3.4% and Li Auto (LI) jumped 4.1%.
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Tesla’s “broken few months.”
Global chip shortages have forced Tesla to make a difficult choice on the manufacturing front, Ives said.
“The last few months have been unstable for Tesla, and that contributes to the overall agitation,” he said.
Tesla’s orders fell nearly 50 percent in May from April, the report said last week, citing inside data. This comes amid weeks of consumer complaints about Tesla’s safety and perceived arrogance, heavily reported in the Chinese state media. In April, Tesla’s shipments to China, excluding exports, fell by two-thirds from March to 11,671, according to data from a trade group.
„Musk & Co. “They’ve obviously hit a rough stretch in the region with concerns about autopilot safety, chip shortages, negative PR issues and a tightening from Beijing over Tesla’s history, contributing to this softer search period,” Ives wrote in a customer note.
Early on Tuesday, investors should receive Chinese EV sales for May, including the first reading on Tesla’s sales in this critical market. These Tesla sales probably reflect orders from previous months.
Tesla also removed radar sensors and some lumbar support features from the US’s 3 and Model Y cars, presumably due to semiconductor supply problems.
Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.
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