Tesla (NASDAQ:TSLA) stock gained about 7% yesterday after the company provided an update on the Tesla Semi, a fully electric semi-truck, at the Advanced Clean Technology Expo in Las Vegas. Furthermore, Dan Priestly, senior manager at Tesla Semi, disclosed plans to deliver an additional 50 trucks to PepsiCo (PEP) as part of the pilot testing program.
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Priestly noted that Tesla Semi trucks were performing well in efficiency tests, averaging 1.7 kilowatt-hours per mile (kWh/mile) even with heavier loads. He also mentioned that a network of Megachargers, specifically designed for the Semi, enables a daily range of 1,000 miles.
Moreover, he revealed that the company is ramping up its gigafactory in Nevada. Further, TSLA plans to produce 50,000 units annually and begin the delivery of semi-trucks from its Nevada factory in 2026.
Tesla Semi Update Comes as a Relief to Investors
It seems that investors breathed a sigh of relief following the recent update on Tesla Semi’s progress. The electric truck, first unveiled in 2017 with a promised 2019 launch, has witnessed delays ever since. TSLA finally started production in late 2022, but at a snail’s pace.
Initially, the truck was being tested by PepsiCo’s Frito-Lay unit in California. Eventually, several companies, including food distributor Sysco (SYY) and logistics service provider Martin Brower, reported using the truck. Moreover, it was recently spotted at the facilities of Walmart (WMT) and Costco (COST).
Thus, the company’s commitment to begin deliveries soon and investments to boost production capacity are encouraging.
Is Tesla a Buy or Sell?
TSLA stock declined about 25% year-to-date due to concerns over its falling vehicle delivery numbers and contracting profit margin. However, the company is currently undertaking strategic efforts to boost its performance, including increased focus on its robotaxi program and fast-tracking its affordable Model 2 production.
Currently, Tesla has a Hold consensus rating on TipRanks. This is based on nine Buys, 15 Holds, and nine Sells. The analysts’ average price target on Tesla stock of $174.60 implies a downside potential of 6.4% from current levels.
