When Tesla CEO Elon Musk emails, investors respond.
After a report that Musk emailed employees informing them that it was time to begin “volume production” of the company’s semi truck, the company’s stock took off, eclipsing the $1,000 per share plateau for the first time. The stock rose more than 8.36% to $1,019 per share in late day trading. Musk confirmed the email in a tweet.
The news is important because Musk told analysts and investors in the company’s most recent earnings call that production of the Semi truck was being held off until next year because the truck requires many more batteries than the company’s cars do and with the popularity of the Model 3 and the recent addition of Model Y production, it didn’t make sense to push the Semi in the near term.
However, the company’s competitor in the Class 8 truck segment, Nikola Corp., is making progress with its Class 8 battery-electric and fuel-cell powered semi trucks. The company just completed a merger with VectoIQ Acquisition Corp. netting Nikola $700 million in cash, which it will use toward building a new plant in Arizona to build the aforementioned trucks.
The company’s battery-electric Class 8 truck – the Nikola Tre – is tracking to be first to market, hitting the road next year. It will be followed by the Nikola Two Class 8 FCEV starting in 2023. The aforementioned build out of hydrogen fueling stations will serve Nikola customers’ fleets, such as Anheuser-Busch, the company notes.
However, that could change with the new focus by Musk, although the email doesn’t set a timeline for production, Reuters reported. “Production of the battery and powertrain will take place at Giga Nevada,” Musk wrote in the email, which was seen by Reuters.
He added that most of the other work will probably take place in other states, although he didn’t elaborate where. The company currently has two other U.S. locations: Fremont, California and Buffalo, New York. The Fremont plant produces the company’s four models, while the Buffalo plant is primarily used for the SolarCity subsidiary producing photovoltaic cells.
In the aforementioned earnings call, Musk has said Tesla would likely use a new plant in the U.S. to produce the batteries needed for the semi as well as the Cybertruck, which has more than 200,000 pre-orders. The company is looking somewhere in the Southwest or Midwest regions of the U.S. for its new plant.
California and Texas appeared to be the early leaders, but Musk’s standoff with California health officials he said the company would be moving all of its operations out of California. That reportedly triggered a flurry of contacts from officials in a number of states not only including Texas and Nevada – the latter the site of the Tesla Gigafactory battery plant –but also Utah, Georgia and Oklahoma.
The Sooner state’s Gov. Kevin Stitt said in a tweet aimed at Musk, “Oklahoma is open for business.” Joplin, Missouri, which sits close to the state’s borders with Oklahoma and Kansas, is reportedly prepared to offer Tesla a $1 billion package of incentives and savings to win the unfolding battle.
Joplin is offering Tesla a 1,042-acre site at a 50% discount, according to a website set up local representatives from the city to woo the company. It’s also coaxing the carmaker with a 100% tax abatement for 12 years, and various other tax breaks and incentives.
He said an announcement would come for certain within the next three months. Tesla officials did not respond to TheDetroitBureau’s request for comment.