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Tesla shares (NASDAQ: TSLA) are trading less well before the show after the "Model Y" event of the night in Los Angeles.
On the plus side, Y's passive filter is targeting one of the hottest automotive segments. Bank of America Merrill Lynch estimates that 40% of all new models launched in the US market between the 2019-2020 model years will be crossovers. However, BAML also notes that the Audi e-tron, BMW iNEXT and Mercedes-Benz EQ will be direct and market competitors before Tesla. "Even with the best efforts of TSLA to meet the strong demand for CUV with a mass market Y model, the company may have difficulty with lower range / price models could result in material pressures on earnings and costs. cash flow, "says BAML's note.
BAML was not the only company slightly under the impact of the Y model. CFRA Research and Canaccord Genuity also released cautionary notes this morning.
As far as the future is concerned, the biggest missing element of the stellar release of the Y model prototype was the details of where the Y model would be produced. Investors wondered whether the Y models would be manufactured in Fremont, Gigafactory, Shanghai or a combination of all three.
There is also the sentimental tone of Elon Musk's presentation of last night to consider and its highlighting of the difficulty in solving the problems of mass production. Could it be that an experienced heavyweight truck is hired at Tesla to run its operations in the future?
TSLA -2.67% pre-market at $ 282.22 to wipe out the gain of a week accumulated prior to the event.
Previously: Tesla Model Y Event – Live Updates (Mar 14)
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