Tesla investor day comes with stock rebounding, CEO Musk tweets Master Plan will be unveiled

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The eyes of Texas will be on Austin Wednesday when Tesla hosts its investor day and annual shareholder meeting from its gigafactory facility near the state's capital.

Stock market expert Adam Kobeissi, founder of the financial newsletter, The Kobeissi Letter, said the meeting will be a "reassurance that Elon Musk’s top priority remains Tesla after a volatile year for the stock and his acquisition of Twitter."

Along with acquiring Twitter for $44 billion, Musk has used the social media platform to dabble in political discussions, leading to reports that shareholders are concerned the billionaire has become distracted.

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General view of the construction site of the Tesla Gigafactory in Austin, Tex., Oct. 25, 2021. The picture was taken with a drone. (Reuters/Mike Blake / Reuters)

Earlier this month, longtime Tesla bull Ross Gerber said he planned to notify the electric carmaker that he would run for its board of directors, citing problems with its public relations, customer service and succession planning. Gerber told Reuters he planned to be a "friendly activist," saying Tesla needs more guidance to handle challenges including growing competition.

Last week, Gerber changed his plans, citing changes investors can expect at the annual meeting. Gerber said in a telephone interview with Reuters that he decided to withdraw after Martin Viecha, Tesla's investor relations chief, told him the company has taken steps along the lines he had originally sought when he announced his board run on Feb. 10.

The company will introduce are more executives than usual at its investor day to show its managerial talent runs beyond CEO Elon Musk, Gerber said.

Tesla also will create more Twitter and promotional content, which could move the brand away from its close identification with Musk. "That's what I'm talking about, them having their own voice separate from Elon," Gerber said.

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"As markets grew concerned Musk was spreading himself too thin with commitments, the stock fell nearly 80% from its high in 2021," Kobeissi said. "The company’s first annual investor day was likely announced in response and will remain a key event for shareholders as he continues to grow his involvement in other companies."

Tesla shares have rebounded and are up more than 90% year-to-date.

Tesla

On Feb. 7, Musk Tweeted that Master Plan 3 will be announced at the March 1 event and would provide "a path to a fully sustainable energy future for Earth." 

Tesla announced its first master plan in 2006 outling a general strategy of building luxury electric sportscars, and subsequently, affordable models of electric vehicles.

In 2016, Musk unveiled the company’s second master plan called "Part Deux" and set the company on pace to expand its EV vehicle line to "address all major segments" of transportation, including a pickup truck and "high passenger-density urban transport."

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Kobeissi said investors can expect the announcement of high level and longer-term goals, generally in line with similar innovations Musk announced in the past. 

"Markets are also hoping for an announcement of a cheaper Tesla in the $25,000 range which would support Musk’s original Master Plan," he continued. "If a cheaper Tesla is announced, the markets would view this as highly favorable, and it would allow Tesla to continue catering to just about every price point of the car market."

Musk too distracted to manage Tesla?

Tesla Inc CEO Elon Musk walks next to a screen showing an image of Tesla Model 3 car during an opening ceremony for Tesla China-made Model Y program in Shanghai, China, Jan. 7, 2020.  (Reuters/Aly Song//File Photo / Reuters Photos)

Jeff Sica, Circle Squared Alternative Investments founder, told FOX Business on Monday that he is holding on Tesla stock after buying in December, and "things like Elon Musk jumping into every political controversy is a concern."

"This shouldn’t be the hill that Elon Musk chooses to die on," he continued. "As much as he loves free speech, he has to realize that he does hurt shareholders when he does this, and it could affect the stock."

At Tesla’s investor day on Wednesday, company stakeholders will get a look at the production line as well as discuss long term expansion plans, generation 3 platform, capital allocation and other subjects with the leadership team.

"I am not selling yet, but I am going to listen very closely," Sica added.

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The construction site of the new Tesla Gigafactory for electric cars is pictured in Gruenheide near Berlin, Germany, Mar. 18, 2022. (AP Photo/Michael Sohn)

Tesla's German plant in Brandenburg near Berlin hit the production target three weeks ahead of a production schedule reviewed by Reuters.

The plant is now producing 4,000 cars per week, the company said on Monday, quadrupling from May when Musk had compared investment in Tesla's new plants to "gigantic money furnaces."

At its new weekly output, Tesla's plant in Germany would have annual output of over 200,000 vehicles. The maximum capacity planned for the Brandenburg plant is 500,000 cars a year, nearing 10,000 per week, the company has said.

The ramp up in output in Germany would allow Tesla to use a larger share of its Shanghai production for markets outside Europe, including Thailand, where it has just launched sales.

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Reuters contributed to this report.

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