Falling lithium-ion battery prices are finally reaching a point where electric vehicles (EVs), such as those made by Tesla (TSLA) and BYD (BYDDY), can match some gas-powered cars in cost. This saw the price of these EV batteries decrease to $97 per kilowatt-hour, marking the first time they’ve come in at under $100 per kWh. With this, luxury EVs are able to match comparable gas vehicles in price for the first time.
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However, more price improvements are needed before budget-friendly EVs are comparable to their gas-powered counterparts. Estimates pin that number at $60 per kWh, with experts predicting EV battery prices won’t go that low until after 2030. Further limiting price drops are manufacturing costs that have some EV battery makers taking losses on production to retain market shares.
What This Means for Tesla and BYD
Given this information, Tesla and BYD appear to have a long road ahead before their EV offerings can counter those of gas-powered car manufacturers. That tracks with analysts’ opinions that EV makers will continue to face headwinds amid stalling demand and lower gross auto margins.
Despite these concerns, the price of TSLA and BYD shares have both increased throughout 2024. TSLA stock is up 70.95% year-to-date while BYDDY shares are up 29.69% over that same period. This growth might tempt traders to jump into these stocks now, but ongoing analyst concerns could signal a pullback that would make a better entry point.
Is TSLA Stock a Buy, Sell, or Hold?
Turning to Wall Street, there’s not enough analyst data for BYD stock, but Tesla has a consensus rating of Hold. That’s based on 12 Buy, 12 Hold, and nine Sell ratings over the last three months. With that comes an average price target of $267.79, a high of $450, and a low of $24.86. This represents a potential 36.11% downside for TSLA shares.
