What You Missed This Week in EVs and Clean Energy

Institutional investors and professional traders rely on The Fly to keep up-to-the-second on breaking news in the electric vehicle and clean energy space, as well as which stocks in these sectors that the best analysts on Wall Street are saying to buy and sell.

From the hotly-debated high-flier Tesla (TSLA), Wall Street’s newest darling Rivian (RIVN), traditional-stalwarts turned EV-upstarts GM (GM) and Ford (F) to the numerous SPAC-deal makers that have come public in this red-hot space, The Fly has you covered with “Charged,” a weekly recap of the top stories and expert calls in the sector.

TESLA CUTS PRICES: Tesla slashed the price of its Full Self-Driving, or FSD, driver assistant software to $8,000 from $12,000 in the United States, as CEO Elon Musk doubles down on self-driving technology, Reuters reports. According to the Tesla website, customers can now pay $8,000 for the FSD feature, or subscribe to use it for $99 a month.

Additionally, the EV-maker has cut prices in a number of its major markets – including in China and Germany – after price cuts in the United States – as it grapples with falling sales and an intensifying price war for electric vehicles, especially against cheaper Chinese EVs, Reuters’ Hyunjoo Jin, Ethan Wang and Christoph Steitz report. The swathe of price cuts comes after Elon Musk’s EV maker reported this month that its global vehicle deliveries in the first quarter fell for the first time in nearly four years.

THESIS-CHANGING SHIFT: Deutsche Bank downgraded Tesla to Hold from Buy with a price target of $123, down from $189. The firm cites the “high likelihood” of Model 2 push-out and the company’s change of strategic priority to Robotaxi for the downgrade. Deutsche’s Buy rating was predicated on Tesla’s next-generation vehicle priced at $25,000 coming late next year, which would allow the company to reaccelerate volume, margins and free cash flow, and potentially come to dominate the Western electric vehicle market. However, pushing out the Model 2 will create “significant” earnings and free cash flow pressure on 2026 and beyond estimates, and make the future of the company tied to Tesla “cracking the code on full driverless autonomy,” which represents a “significant technological, regulatory and operational challenge,” says the firm. Deutsche views Tesla’s shift to Robotaxi as “thesis-changing,” and worries the stock will need to undergo a “potentially painful transition in ownership base,” with investors previously focused on electric vehicle volumes and cost advantages potentially “throwing in the towel, and eventually replaced by AI/tech investors with considerably longer time horizon.”

Click here to check out Tesla’s recent Media Buzz Sentiment as measured by TipRanks.

LI AUTO SLASHES PRICES: Chinese automaker Li Auto (LI) has slashed prices by roughly 5% on four of its five models and announced it would refund owners who purchased those models earlier this year, Reuters’ Brenda Goh reports, citing the cuts. The company announced cuts of between 18,000 and 30,000 yuan on its L7, Li L8, Li L9, and Li MEGA models, which comes after price revisions by Tesla and BYD (BYDDF).

BUY BYD: Macquarie resumed coverage of BYD with an Outperform rating and HK$280 price target. BYD is evolving from “a domestic champion into a global powerhouse” as the company’s competitiveness in affordable, mass-market plug-in EVs is “unmatched globally due to high vertical integration and scale,” the firm tells investors.

ON THE SIDELINES: Citi resumed coverage of Lucid Group (LCID) with a Neutral rating and $2.90 price target. The firm sees a balanced risk/reward when weighing Lucid’s “strong” electric vehicle technology position and “adequate” near-term liquidity against past demand and branding challenges and the company’s reliance on a successful Gravity ramp later this year. Having spent some time reviewing Gravity, Citi came away encouraged by the vehicle and sees good prospects for success. Still, a fair amount of execution risk exists to launch Gravity on time, says the firm.

LAYOFFS: Rivian will lay off about 1% of its total headcount, the second major round of job cuts this year as the company aims to cut costs amid a broader EV demand slowdown, Reuters’ Abhirup Roy and Akash Sriram report. “This was a difficult decision, but a necessary one to support our goal to be gross margin positive by the end of the year,” the company told Reuters in an email.

MORE DEFENSIVE SOLAR STANCE: Wells Fargo upgraded First Solar (FSLR) to Overweight from Equal Weight with a price target of $250, up from $187. The firm says that as the solar sector continues to struggle due to several headwinds, it is getting more defensive with its ratings. Wells’ upgrade First Solar due to its relative stability and several potential catalysts. First Solar is sold out through 2026, which provides near-term earnings stability, the firm tells investors in a research note. Wells also sees a number of potential catalysts on the horizon from the lifting of bifacial exemptions, further trade barriers on Chinese panels, restricting Inflation Reduction Act credits and a potential Trump presidency.

The firm also downgraded Sunnova Energy (NOVA) to Equal Weight from Overweight with a price target of $6, down from $11, as interest rates may stay higher for longer. The firm is reducing exposure to residential solar. While some companies can afford to wait for rates to fall and the residential solar market to rebound, Sunnova has upcoming debt maturities and tight liquidity, Wells tells investors in a research note. The firm says the company’s pace of cash generation seems to be tracking below required levels to address debt maturities.