Tesla Inc. TSLA,
was able to reach its target of 500,000 deliveries by 2020, a target that was not on the radar of Wall Street analysts, going back to late spring / early summer, thanks to power in China and a late push in Europe and the USA, Dan Ives, analyst at Wedbush wrote in a note published on Wednesday. “Based on our initial analysis of demand and the delivery trajectory worldwide for Tesla in 4Q, it appears that Musk & Co. is likely to exceed the expectations of Street and Internal,” Ives wrote. The analyst expects deliveries in the fourth quarter to come closer to 190,000 to 200,000 than the 180,000 he called the ‘line in the sand’. “With a view to the end of the year and 2021, we see a huge increase in demand for EV worldwide, with our expectation that EV vehicles will increase from ~ 3% of total car sales today to 10% by 2025,” wrote Ives. “We believe that these demand dynamics will disproportionately benefit the clear EV category leader Tesla over the next few years, especially in the key region in China, which we believe could represent ~ 20% of its EV deliveries by 2022, given the current rapid pace of sales. ” Ives expects a “striking” demand from China across the board in 2021 and 2022 and says Tesla’s flagship Giga 3 footprint is a major competitive advantage, as local companies such as BYD, Nio nil,
Xpeng XPEV,
and Li Auto Inc. LI,
is also firing on all cylinders. “If China stays on its current path for Tesla, Musk & Co could hit one million delivery units worldwide by 2022 (we are currently modeling a 2023 period),” he wrote. An additional boost could come in the form of increased EV credits under the administration of Pres. Joe Biden, he said. Wedbush rates Tesla as neutral with a price target of $ 715 for 12 months and a bull drop of $ 1,000. Tesla shares reversed early losses before the market to gain 1.1% and rose 696% in 2020, while the S&P 500 SPX,
achieved 15%.
