What’s Going On Here?Tesla showed off its latest car – the Model S Plaid – at a flashy event late last week, and it’s fast. Really fast. Like, this has never happened to Tesla. Honest. What Does This Mean?Investors have known about the Model S Plaid for a while, but this was a chance for Tesla to really show off its performance. And it was worth showing off: the car can go from nought to 60 in under two seconds – faster than modern F1 cars – and has an estimated range of 390 miles. And since that pushes electric vehicle performance even further forward, Tesla’s innovations should bring the rest of the industry along for the ride. Why Should I Care?For markets: Tesla’s back, baby.
Tesla sells far more of its cheaper models than its expensive ones, but the latter make a big difference to the company’s profitability. That might be why Tesla announced it’d be upping the Model S Plaid’s mooted $120,000 price tag by $10,000. And considering it’s expecting to sell 1,000 a week next quarter, that translates to an annualized revenue rate – that is, if you applied the data across a whole year – of almost $7 billion. That’s especially significant when you remember that Tesla’s forecasted revenue for the year is $50 billion, and it could help reverse its stock’s bad run of form: it’s underperformed US stocks by 25% in 2021.
Zooming out: Bitcoin can’t catch a break.
Tesla recently dealt bitcoin a blow by announcing it’d no longer accept it as payment, and the OG cryptocurrency suffered another setback late last week: an influential regulator proposed classifying bitcoin as the riskiest of assets for banks to hold. The good news is that the proposal acknowledges banks can hold bitcoin, but the bad news is that it’d force them to have a potentially prohibitive amount of cash as backup: one dollar for every dollar’s worth of bitcoin. | 