Tesla stock drops 5% after HSBC calls it a ‘very expensive auto company’

Tesla The stock closed down about 5% on Thursday to $209.98 after HSBC Global initiated an “underweight” rating and a $146 price target. HSBC analysts called Elon Musk both an asset and a risk to Tesla in a report, noting that he is a “charismatic CEO with a cult following” and “a reputation for innovators.” Narrative provides motivation”.

Analysts also note that “hope” is baked into Tesla’s stock price, surrounding the company’s many ambitious future technology projects, from long-delayed driverless systems to humanoid robots and supercomputers. “It’s fair to say these ideas need to become a reality to support current share prices,” the analysts said.

From a pessimistic perspective, HSBC analysts wrote, “significant delays or progress suggest a lack of technical and/or regulatory feasibility for commercial launch of these projects, posing significant risks to Tesla.”

On a more optimistic note, analysts at HSBC said Tesla’s core automotive business “faces fewer challenges than incumbents and therefore deserves a premium.” “Electric vehicles are riding high on rising penetration,” they said. This is a growing market and is likely to remain so for decades. Tesla is already the cost leader and will likely stay that way given its stated ambitions (and scale).”

Also on the bullish side TeslaThey added that “faster-than-expected developments” in these areas “could lead to a re-rating of Tesla’s P/E ratio” and that Tesla’s core EV “market share gains driven by price cuts that we expect could also be higher than Anticipated” business.

In addition to the “downgrade” rating from HSBC, Tesla also faces an expanding strike in Sweden.

Swedish unions are putting pressure on Tesla through strikes and blockades as the company has so far refused to sign a collective bargaining agreement for its service sector employees, which include technicians and mechanics who repair and maintain customer cars.

The IF Metall union, which represents some Tesla service employees, began strike action at 12 Tesla service centers on October 27. New York Times the report said. Dockworkers who are members of the Swedish Transport Workers’ Union said they would not unload cargo at the region’s ports if electric vehicle manufacturers failed to negotiate a collective bargaining agreement by November 17. Electricity workers who maintain the company’s charging stations have also promised to strike starting on November 17 if an agreement cannot be reached.

Industrial action could reportedly spread to Norway new republic.

Meanwhile, President Joe Biden addressed UAW workers in Illinois on Thursday, expressing support for union leaders’ ambitions to reach collective agreements with Tesla, Toyota and other companies.

UAW President Shawn Fain said during October online broadcast“, “When we get back to the negotiating table in 2028, it won’t just be with the ‘Big Three’, but with the Big Five or the Big Six. “

Tesla is also expected to host a Cybertruck event at the end of this month. While specifications and pricing for the final version of the Cybertruck have yet to be announced, Tesla has allowed some Cybertrucks to participate in promotions.Car critics, including enthusiasts and professionals Already panned Their build quality and design this week, according to Autopian.