Invest in Tesla Stocks: 5 Big Risks That You Might Face

Tesla company stocks have been admired and avoided by people simultaneously. The main reason for its appraisal is the controversial behaviour of its CEO Elon Musk, who is behind the popularity of many things. Through his tweets, he not only publicises his company but also supports other businesses. His main contribution is to the rise of cryptocurrency, where he made Bitcoin reach its all-time high price and lowest price. He was one of the few people who started accepting payments in cryptocurrency and led the other companies to do the same. Most of the price fluctuations in the crypto market are due to his efforts. You can measure those market fluctuations and do some serious trading through the thesteller-profit.com website.

 

Back to TSLA shares, they are a very efficient source of investment, but you should also keep a few things in mind to avoid significant losses. We have compiled some essential pointers that could help you in your journey towards investing in TSLA.

1. Expensive Tesla Cars

Tax breaks for alternative technology, an incentive by the government which glimmered hope in the eyes of Tesla enthusiasts, resulted in no change as the electric car’s prices are still out of reach for most people. The Tesla Model S has a hefty price tag of $94,990 without any discount coupons or codes. Coming to the lower-cost option, the Model 3 is priced at $43,990 without tax incentives & gas savings. The cars are not only expensive for those buying them, but they are also becoming expensive for the manufacturing unit. The company lost an estimated $14,000 on each Model 3 car sold, but it is speculated that the figures may improve as the company improves its venture.

1. Battery Crisis

Tesla came up with new powering incentives, but they backlashed as the executives found it difficult to power their product due to the lack of batteries. The Gigafactory that is still under construction in Nevada is being built with the sole purpose of resolving this battery crisis. With an estimated footprint of more than 1.9 million square feet, the lithium-ion factory speculates to increase the production of more than 500,000 Tesla cars every year. The Gugafactory has to face logistics or regulatory hurdles, and it will continue, which might prolong the date of its completion. The government of Nevada has given the company its blessings as it is speculated to make $100 billion in extra economical activity over the upcoming decades.

1. Low Gas Prices

Gas prices saw an all-time low during 2014-2015, which compelled people to buy gasoline-powered cars. Tesla products lose in that domain because of their all-electric composure, but as it provides more convenience, some people still find a way to buy the car. Gas prices do not have to stay low all the time to put an impact on TSLA shares, they have to drop down every once in a while, and the shares will come tumbling down. Petroleum supplies are not dropping down, and at the same time, internal combustion engines are providing high mileage at a very nominal rate. Light-duty passenger cars are finding ways to improve their fuel efficiency, and they have been successful in that for now. To overcome this problem, Tesla has to sell more cars and find another unique selling proposition which might compel people to invest in the super expensive cars.

1. Exceptional Vehicle Competition

If you think Tesla is the pioneer of electric cars, you are wrong. The production of electric cars dates back to 1834. Thomas Davenport created it, but the reigns of popularity go to Tesla as no one reached the heights of people’s engagement as much as this company did. Two very harsh competitors, Nissan Leaf and Chevrolet Bolt, tried to snatch the market from Tesla but failed due to high prices and lower driving range. Nissan Leaf’s starting price is $27,400 with a driving range of 226 miles, while Chevrolet Bolt’s 2022 model starts at $31,000 with a range of 259 miles; that is more than the 220-mile range of Tesla Model 3. Other companies are expected to follow suit. Some of the prominent names are Ford, Subaru, BMW, and Volkswagen.

1. A CEO With Multiple Stories

Elon Musk is famous for his controversial tweets and behaviour. It is said that Tesla mostly depends on how its CEO will act; if he does something wrong or highly controversial, the company has to manage the dip, and if he does something exceptional, the company gets a few good days of growth. He has made the TSLA share market more vulnerable than the cryptocurrency market. 

Ending Statement

Being a trillion-dollar market, Tesla has significantly changed the manufacturing industry. The company creates cutting-edge automobiles that are widely admired and welcomed. The manufacturers are always finding new ways to make improvements in the current models and make new changes in the upcoming models. Telsa is aimed to produce eco-friendly vehicles and stand out from the crowd by making fully automated cars. But buying its shares can be really risky. If you learn about the market and what makes its shares go up, you will be able to take advantage of its increasing price.