Tesla Updates: Musk’s Path to a $500 Billion Company
A “broad investor call” was held on Thursday by the Underwriters of the work of Tesla to raise $2 billion in new funds, Citigroup and Goldman. Broker’s asked some questions to CEO Elon Musk and CFO Zach Kirkhorn. Particularly about their upcoming plans for Tesla.
The CEO answered the questions without beating around the bush. And he revealed the self-driving strategy of Tesla immediately. He also explained what he and other executives discussed in their previous event for investors. The event dubbed as Autonomy Day.
Musk assures the investors during the call that Tesla will turn into a company with a $500 billion market cap by this autonomous driving. He also said that adding self-driving capabilities via software to existing Teslas will boost its value. Each vehicle may cost up to $250,000 in just three years.
After the company announced that they are going to $2 billion, $650 million for equity and $1.35 billion convertible bonds, the broad investor call has taken place. The filings imply that the capital raised by Tesla is for general corporate purposes. Tesla can run its business through cash flow. However, it’s better if we have a defense against a recession or weak global auto demand, Musk said on the call.
On the call, Kirkhorn told the investors that the outlook for Q2 in Tesla didn’t break. They still assume to have 90,000 to 100,000 vehicles delivered in the second quarter. And for the entire year, they expect to produce 360,000 to 400,000 vehicles.
In the first quarter of 2019, Tesla wrecked $4.10 a share or $702.1 million. But on Thursday, the company’s shares boost up to 4%. After that, the new funding solicitation announcement happened.
Musk specified that electric vehicles, solar, and energy storage business lines of Tesla serve as a support of value to the new driverless era of the company.
The company’s competitors like GM’s Cruise and Alphabet’s Waymo won’t stand a chance since Tesla holds a line of connected cars outside and a proprietary chip.
Get the latest economy news, trading news, and Forex news on Finance Brokerage. Check out our comprehensive trading education and list of best Forex brokers list here. Subscribe now and receive FREE updates on the market today!