According to a leaked email, the company is “making preparations” to ramp up production.
Tesla’s shares rose on Wednesday after it came out that the company is preparing to increase production at its Fremont, California factory. The news broke thanks to a leaked email from the company’s automotive president Jerome Guillen.
Here’s what it said…
Guillen was vague about why the company plans to increase production but said that employees “will be delighted with the upcoming developments.” He also said that the company will soon be hiring at its Fremont location as well as its factory in Reno, Nevada.
What Does This Mean for Tesla?
The news that Tesla is hiring and plans to ramp up production caused a lot of excitement among Wall Street investors. Investors have been waiting for a Tesla rebound ever since the company hit its 52-week low of $176.99 on June 3.
The leaked email caused the company’s shares to rise nearly 4% and close at $238.92. It is exciting to consider Tesla ramping up its production, mostly because this indicates strong consumer demand for the Model 3.
The Model 3 is Tesla’s number one seller and performs much better than both the Model S and the Model X. The company delivered 95,200 cars during the second quarter and the Model S and Model X only accounted for 17,650.
Guillen also stated that the company is making improvements at its Shanghai plant. Ironically, he concluded the email by asking employees to please not leak internal company emails to the press.
Will the Momentum Last?
2019 got off to a bumpy start for Tesla and the company’s shares are down more than 28% year to date. However, the stock has rallied more than 30% since early June. This is largely thanks to the company beating its delivery record earlier this month.
At this point, it’s likely that investors are cautiously optimistic about Tesla. Many have stated they are withholding judgment until they see the company’s second-quarter earnings report on Aug. 7. This will be the true test and will show investors once and for all how increased production and deliveries benefit the company’s bottom line.
