The news from Germany over the weekend boosted Tesla stock by as much as 2.1% on Monday. Even after giving back part of its earlier gain, the stock was still up 1.2% as of 12:50 pm ET today.
What is the Reason?
According to a report in Automobilwoche, a German auto news publication, Tesla (NASDAQ:TSLA) plans to more than double its sales in Germany this year compared to 2021. If the EV market leader succeeds, it will overtake Toyota as the most popular brand in the largest economy in Europe.
Sales expansion plans in Germany are not unexpected, given Teslas (NASDAQ:TSLA) ongoing production increases at its new Gigafactory in the Berlin area. However, it is an ambitious objective to treble sales this year, putting the company ahead of Toyota in overall German car sales. As of August, Teslas share in the German market was 1.5%.
Thats in contrast to the roughly 6% market share that passenger automobiles have enjoyed this year in the United States. In the United States, where Tesla (NASDAQ:TSLA) is based, the company is responsible for almost 66 percent of all battery electric vehicle sales, as reported by Barrons.
Before the German plant opened earlier this year, Tesla (NASDAQ:TSLA) had supplied its German customers via its Shanghai manufacturing. About 40,000 electric vehicles were sold by the company in Germany in 2017. For Tesla to sell 80,000 vehicles in 2022, they need to do so during the next four months. If that number holds, it will surpass Toyotas projected 75,000 sales in Germany for the year.
The accomplishment would be wonderful news for the progress in setting up the German Gigafactory, which is why investors are pushing the stock higher today. As CEO Elon Musk said earlier this year, the facility and its new plant in Texas were losing money and cutting production because of shortages in the supply chain. Investors in Tesla stock would want to hear that the two new factories are producing automobiles at a rapid pace and helping to boost the companys bottom line.
Featured Image – Megapixl (C) Thorken
Author: Shariq Khan
Market Jar Media Inc.
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Vancouver, BC, Canada
Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No Fortune Outlook journalist was involved in the writing and production of this article.