Tesla Price Prediction: A Blow-off Top Followed by Epic Collapse

  • Hertz Announced an initial order of 100,000 Tesla’s to be filled by year-end 2022.
  • Tesla skyrocketed from a $913-billion market cap (October 22, 2021) to $1.21 trillion.
  • The bullish response added $300 billion, implying a $3-million price tag per vehicle ordered (not sold).

Tesla Daily Chart

Tesla shares skyrocketed above $1000 on the Hertz announcement. Tesla is now worth more than all the auto manufacturers combined. More on that later.

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Tesla Market Cap

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https://ycharts.com/companies/TSLA/market_cap

Gross Profit

Let’s say Tesla makes a generous $20,000 profit per vehicle ($20,000 X 100,000). That indicates a gross profit of $2 billion, far shy of the $300-billion increase. What is going on here?

Ford Motor Company

By comparison, Ford Motor Company currently sports a $72-billion market cap, so Tesla adding $300 billion in market cap is like adding four (4) Ford Motor Companies.

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https://ycharts.com/companies/F/market_cap

Major Auto Companies by Market Cap

Below is a quick rundown of all major auto manufacturers by current market cap. Tesla is worth more than all and sells less than 1% of the vehicles.

With a market cap of $1.21 trillion, TSLA is trading at a 25% premium above all auto manufacturers on the planet!

Tesla looks, acts, and smells like a bubble. The question is…when will it pop?

AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For regular updates, please visit here, or follow AG on Twitter at https://twitter.com/ag_thorson

AB Volvo Warns Chip Woes to Linger After Narrow Profit Miss

By Niklas Pollard

Operating profit at the maker of trucks, construction equipment, buses and engines nearly tripled to 9.73 billion Swedish crowns ($1.12 billion) from 3.27 billion a year ago, but slightly missed the 9.84 billion seen by analysts according to Refinitiv data.

A global shortage of semiconductors just as the market roared back after last year’s pandemic plunge has squeezed makers of heavy-duty trucks as well as smaller vehicles, crimping production, extending lead times and lifting costs.

Volvo, a rival of Germany’s Daimler and Traton, said it struggled with total production stoppages of close to a month in the second quarter.

And while recovering strongly, the group’s reported sales and adjusted earnings remained below cyclically-high levels reached over the same period in 2019, before the pandemic hit.

“There will be further disruptions and stoppages in both truck production and other parts of the group in the second half of the year,” CEO Martin Lundstedt said in a statement.

“Together with our business partners we are continuing to work hard to increase production levels.”

Meanwhile, demand for heavy-duty trucks is strong with a surge in online shopping due to the pandemic driving freight volumes and rates and emboldening fleet operators to move ahead with vehicle orders suspended after the virus first struck.

“This demand situation is broad based across segments, both in Europe and North America and on both new and used vehicles,” the company said.

Volvo said order bookings of its trucks, also sold under brands such as Mack and Renault, soared 143% from a weak year-ago quarter and stood by forecasts for solid market growth in both Europe and North America this year.

The company also raised its 2021 outlook for construction equipment markets in both regions.

($1 = 8.6971 Swedish crowns)

(Reporting by Niklas Pollard, editing by Supantha Mukherjeem Subhranshu Sahu and Tomasz Janowski)

Daimler, Volvo and Traton Plan $600 Million Truck-charging JV

Charging infrastructure expansion has been a central hurdle to the mass adoption of battery-powered vehicles.

The three companies, which are normally competitors, will invest 500 million euros ($593.20 million) in the venture that they will own equally and that will start operations in 2022.

The aim is to install and operate at least 1,700 charging points within five years.

The joint company will be based in Amsterdam and will over time seek further partners and public funding.

($1 = 0.8429 euros)

(Reporting by Ilona Wissenbach and Chris Steitz; writing by Tom Sims; editing by Barbara Lewis)

Luminar Technologies Rally Following Volvo Announcement

The shares of Luminar Technologies are performing excellently today after Volvo announced that it would be integrating its lidar system as standard equipment on a vehicle. This latest development makes Volvo the first major auto manufacturer to integrate the technology.

Volvo integrates the Lidar system into its EVs

Volvo has announced that it would be integrating Luminar’s new Iris lidar system in its upcoming electric flagship SUV. The announcement means that Volvo is the first major car manufacturer to integrate the technology as standard equipment on a vehicle.

The Iris Lidar system is an advanced sensor that allows a car to view its environment better. The system will be integrated into Volvo’s electric flagship SUV, a successor to its current XC90. The electric SUV is expected to be unveiled by next year.

Volvo CEO Hakan Samuelsson said, “Volvo Cars is and always has been a leader in safety. It will now define the next level of car safety. By having this hardware as standard, we can continuously improve safety features over the air and introduce advanced autonomous drive systems, reinforcing our leadership in safety.”

Lidars (short for light detection and ranging systems) allow cars to sense their surroundings and help avoid obstacles. Luminar founder and CEO Austin Russell is confident that although this is the first time the technology is standardized, it wouldn’t be the last time.

Russell revealed that the technology is integrated into Volvo’s next-generation EV platform, implying that Volvo could offer it as a standard or optional on all of its upcoming electric vehicles.

Luminar Technologies’ stock price performing excellently

Luminar Technologies’ stock price has been rallying since the announcement earlier today. Thanks to this latest development, Luminar Technologies is one of the best-performing stocks today.

LAZR stock chart. Source: FXEMPIRE

LAZR was up by 12% during Thursday’s pre-market trading session. It is now up by 10% since the market opened, surpassing the $24 mark earlier today. The latest rally could see LAZR recover its losses as it is over 20% down year-to-date.

AB Volvo Proposes Distributing Proceeds From Ud Trucks Sale

Volvo said in a statement that the proposal entailed a distribution of 9.50 crowns per share, corresponding to around 19 billion Swedish crowns ($2.3 billion), and that an extraordinary general meeting would decide on the proposal on June 29.

“Key positives are the earlier-than-expected announcement (EGM as early as June 29) and the symbolic message with the chairman saying that the group’s improved profitability, resilience in downturns and strong financial position underpins the decision,” investment bank Citi said in a note.

AB Volvo and Japan’s Isuzu Motors in April finalised a previously announced strategic alliance, which includes Isuzu buying Volvo’s UD Trucks for around 20 billion crowns.

($1 = 8.2689 Swedish crowns)

(Reporting by Anna Ringstrom and Helena Soderpalm; editing by Jason Neely)