Tesla (TSLA) plans to enhance parts production at its Shanghai factory in China. According to Reuters, the expansion drive will allow the electric vehicle (EV) giant to meet growing export demand. TSLA shares fell 7% to close at $764.04 on February 23.
Tesla is a U.S. company that designs, manufactures, and sells fully electric cars. It also deals in solar energy generation systems and energy storage products.
Shanghai Factory Expansion
Last year, a report in the state-backed daily newspaper indicated that the automaker planned to invest up to $190 million to bolster its production operations in China. At the time, there was an indication that the expansion drive would result in the employment of an additional 4,000 people at the Shanghai factory.
Documents filed with the city government indicate that Tesla also plans to lengthen the operating time of equipment to produce more parts. However, the automaker has yet to share the finer details of its plans.
The Shanghai factory can produce up to 450,000 cars comprising Model 3 and Model Y every year. Last year the EV giant sold 470,000 vehicles made in China, with 160,000 sold overseas.
Last week, Morgan Stanley analyst Adam Jonas reiterated a Buy rating on Tesla stock with a $1,300 price target, implying 70.15% upside potential to current levels. The analyst believes that autonomous vehicles are overhyped and that it could take two decades to see an inflection.
Consensus among analysts is a Moderate Buy based on 17 Buys, 7 Holds, and 6 Sells. The average Tesla price target of $1,097.33 implies 43.62% upside potential to current levels.
Download the TipRanks mobile app now.
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.