Tesla Inc. TSLA,
could reach its target of 500,000 deliveries by 2020, a target that was not on the radar of Wall Street analysts dating back to late spring / early summer, thanks to strength in China and a late boost in Europe and the United States, Wedbush analyst Dan Ives wrote in a note released Wednesday. “Based on our initial analysis of Tesla’s global demand and delivery trajectory during Q4, it appears that Musk & Co. will likely exceed domestic and street expectations,” Ives wrote. The analyst expects fourth-quarter deliveries to come closer to 190,000 to 200,000 than the 180,000 he called the “line in the sand.” “Towards the end of the year and 2021, we see a major influence on the demand for electric vehicles globally with our expectations that EV vehicles will go from ~ 3% of total car sales today to 10% in 2025” , wrote Ives. “We believe that this demand dynamic will disproportionately benefit the clear leader in the Tesla electric vehicle category over the next few years, especially in the key region of China, which we believe could account for approximately 40% of its electric vehicle deliveries in 2022. given the current pace of sales “. Ives expects “impressive” demand from China in 2021 and 2022 and said Tesla’s Giga 3 footprint is a major competitive advantage, as domestic companies like BYD, Nio Zero,
Xpeng XPEV,
and Li Auto Inc. LI,
they are also “firing at all cylinders.” “If China stays on its current path for Tesla, Musk & Co. could reach one million delivery units worldwide by 2022 (we are currently shaping the 2023 deadline),” he wrote. An additional increase could come in the form of an increase in electric vehicle credits under the administration of President-elect Joe Biden, he said. Wedbush values Tesla as neutral with a 12-month price target at $ 715 and a $ 1,000 box. Tesla shares reversed the first premature losses to gain 1.1% and have gained 696% in 2020, while the S&P 500 SPX,
has gained 15%.