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At Tesla's Investor Independence Day last week, Elon Musk outlined the automaker's plan for self-driving, but the CEO adds a valuation forecast as the company tries to collect more than 2 billions of dollars.
Yesterday, Tesla requested a capital increase of up to $ 2.3 billion.
Following the announcement, Citigroup and Goldman Sachs, two of the underwriters of Tesla's new capital increase, appealed to investors with some Tesla executives, including CEO Elon Musk.
According to interlocutors (via CNBC), Musk has focused on Tesla's effort, going so far as to say that all of Tesla's current activities, electric vehicles, energy storage and solar energy, are just funds. valuable.
He repeated many of the things that he had already said last week during Tesla's Independence Day, but he also added that he saw Tesla realize a market capitalization of 500 billion dollars thanks to its autonomous technology:
Musk told investors that self-driving would turn Tesla into a company with a market capitalization of $ 500 billion, these people said. Its current market capitalization is approximately $ 42 billion. He also said that the current value of Teslas will increase as self-driving capabilities will be added via software, and that their value will reach $ 250,000 in the next three years.
This would represent an increase of more than 10 times that of Tesla's current market capitalization of about $ 42 billion.
The CEO reportedly refused to answer questions about Tesla's current commercial efforts to focus on self-reliance:
"But he also tried to bring the conversation back to autonomy, calling it a fundamental value factor for Tesla, and urged investors to stop the actions on vehicle margins."
Musk plans to participate in the capital increase itself by buying an additional $ 10 million of Tesla shares.
Electrek's Take
The thing is this: if Elon is right about Tesla's autonomous driving strategy, he's also right about the evaluation.
If Tesla can actually transform virtually the entire vehicle produced since October 2016 (after some computer improvements) into autonomous cars / robotaxis with a software update at some point next year, the company will indeed generate hundreds of billions of value overnight.
Of course, it's not that simple. Deployment will likely be gradual, as regulatory approval will be based on jurisdiction, but you understand the point.
As I said before, I agree with Tesla's approach to autonomy, so I think Tesla can do it.
However, Tesla's current business of selling vehicles to customers with a decent gross margin remains extremely important.
The problem is that Tesla has to do it and Elon has always been imprecise about the chronology of autonomous driving.
What the first quarter has shown is that Tesla can be really at risk with only a few months of issuance. In other words, Tesla must survive while delivering as many vehicles as possible until its self-driving technology works.
An additional $ 2 billion in the bank should help them and give them something like a buffer year.
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