investors woke to a bit of good news Thursday but the stock isn’t having much of a reaction. The stock market, as ever, is forward-looking and Thursday’s news was in the stock earlier this week.
Handelsblatt, a German newspaper, reported Thursday that Tesla (ticker: TSLA) received its final permits for its new facility near Berlin. That means the auto maker can start assembling cars in Europe.
It has taken a while for the plant to gain final approval. Turns out, it was easier for Tesla to build a plant in China.
Tesla and German government officials didn’t immediately respond to a request for comment about plant permitting. Handelsblatt also reported there will be a news conference Friday to review the approval and that invitations have been sent to reporters.
Tesla stock is down in premarket trading, falling about 0.7% to $873.50. But Tesla shares rose 7.5% on Monday and news that German plant approval looked imminent helped the daily performance.
Coming into Thursday trading, Tesla stock has gained 8.6% for the week. The
has been flat. The
Dow Jones Industrial Average
has dropped about 0.5%.
Wall Street expects Tesla to delivery roughly 1.5 million vehicles in 2022, up 50% to 60% from the 936,000 delivered in 2021. New production in Germany and Austin, Texas, are needed to hit those numbers.
Analysts project the German plant will produce roughly 110,000 vehicles this year. A similar amount is projected for the Austin facility. The rest of projected growth is expected to come from further expansion of Tesla’s Chinese assembly plant.
Tesla’s Chinese plant in Shanghai took roughly 15 months to go from breaking ground on construction to producing vehicles. With final approval, the German plant will take about 25 months to go from construction to production.
Production in Shanghai began in 2020. Output in 2022 is expected to surpass 800,000 units. The Chinese plant was producing at its initial designed capacity about a year after production began.
Next up for Tesla investors will be an update about the plant in Austin, which has been under construction for about 20 months. Tesla has been making some cars at both Austin and Germany, but neither plant has started into a higher-volume production phase yet.
Write to Al Root at [email protected]