Electric vehicle (EV) maker Tesla Inc. (TSLA) has withdrawn its $1.28 billion state subsidy application in Germany. The company said it would build its 4680 battery plant and recycling facility at the Berlin gigafactory without government funding.
TSLA informed the Federal Ministry of Economics and the Brandenburg Ministry of Economics in Germany about the same. Shares closed down 3.1% at $1,081.92 on November 26.
In January this year, the European Union approved subsidies for electric vehicles battery makers such as BMW and Tesla, and reserved the final decision for the end of the year. However, the EV giant has decided to go against the subsidy with no formal reasoning for the same.
Elon Musk, CEO of Tesla, was noted tweeting, “It has always been Tesla’s view that all subsidies should be eliminated, but that must include the massive subsidies for oil & gas. For some reason, governments don’t want to do that.”
The statement reflects Tesla’s strength and its capability to build the massive project without being dependent on any government grants. The company will continue to build its gigafactory as per schedule; however, the final approval is still pending. Tesla plans to build its Model Y in Germany, which is currently being imported from China.
In a separate release, a German media outlet Automobilwoche said that Tesla might receive its full approval for the Berlin Giga factory in a few days and that the company could start manufacturing Model Y by December.
Brandenburg’s Office of the Environment recently concluded its online discussions over some 800 objections from activists against the project. After completion, Brandbenburg’s Economics Minister Jörg Steinbach (SPD) was noted stating that he was confident that the Giga Berlin would produce its first Model Y by the end of 2021.
The Wall Street community has a Hold consensus rating on TSLA stock with 10 Buys, 6 Holds, and 7 Sells. The average Tesla price target of $887.38 implies 17.9% downside potential to current levels. Shares have gained 90.6% over the past year.
TipRanks’ Website Traffic tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into TSLA’s performance.
In October, Tesla website traffic recorded a 13.17% year-over-year decline in monthly visits. However, year-to-date website traffic growth increased by 1.72% compared to the same period last year.