Sometimes you wonder what investors want from electric vehicle giant Tesla (TSLA). A new report suggesting that elements of the United States Senate are getting behind Tesla’s robotaxi efforts in a big way met with near-disaster at shareholders’ hands. Perhaps it was because the report also offered support for Alphabet’s (GOOG) Waymo as well. But either way, Tesla took it on the chin, and shares plunged over 5% in Wednesday afternoon’s trading.
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Basically, the word out of the Senate Commerce Committee is simple: if the United States does not lead the way in AV (automated vehicle) development, China likely will. And falling behind China on any point is not something the Senate Commerce Committee wants to see.
Thus, the committee, along with Waymo and Tesla elements, is putting it to Congress to pass legislation on AV systems that has long been stalled, which allows domestic development to ramp up before the Chinese can get ahead beyond America’s ability to recover. Waymo reps noted, “…the autonomous vehicle sector is now under direct threat. The United States is locked in a global race with Chinese AV companies for the future of autonomous driving, a trillion-dollar industry comparable in strategic importance to flight and space travel.”
No Juice for You
Meanwhile, Tesla had a plan to bring a driverless car charging station to San Francisco’s Jackson Square. And for a while, the plans were rolling along as the San Francisco Planning Commission approved a “conditional use authorization” to convert a public parking garage to a charging station.
But Teamsters Local 665, one of San Francisco’s biggest unions, stepped in to appeal the project, and eight supervisors from the Planning Commission board allowed a public hearing on the matter to go through. Tesla, meanwhile, decided that sounded too much like trouble, and declared it was out. The closest anyone could get to a reason was “…significant building constraints unrelated to the appeal.”
Is Tesla a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 11 Buys, 12 Holds, and seven Sells assigned in the past three months, as indicated by the graphic below. After an 11.58% rally in its share price over the past year, the average TSLA price target of $393.51 per share implies 2.25% downside risk.
