Tesla shares advanced Friday after the prior session’s rout as investors digested the latest price changes at Elon Musk’s electric vehicle company.
Shares of the EV maker, which fell about 10 percent Thursday after its latest results, rose slightly as it lifted prices on its two luxury vehicles — the Model S and Model X — by around three percent in the United States.
The move marked an ostensible reversal from Tesla’s stance throughout this year, as it undertook multiple price cuts across its fleet.
The most recent change came Tuesday night when Tesla trimmed prices on the Model 3 and Model Y, which are aimed at the middle market and comprise a much bigger volume of sales than the two luxury models.
The price of a model S now begins at $87,490, while that of the Model X starts at $97,490.
But the latest Tesla proposition includes three years of free supercharging on the two pricier vehicles, muddying the question of whether the company is truly increasing its prices.
“It’s sort of a wash,” said CFRA Research analyst Garrett Nelson, who noted Musk’s talent for generating buzz that helps substitute for costly marketing campaigns employed by other auto companies.
“They’re trying to get the attention of luxury buyers for their two premium vehicles,” Nelson said. “It’s somewhat gimmicky, no question about it.”
Shares of Tesla were up 1.0 percent near midday on Friday.
That is a reversal from Thursday, when Tesla shares plunged after Musk signaled that more price cuts were likely.
He said in Wednesday’s earnings call: “We’ve taken the view that pushing for higher volumes and a larger fleet is the right choice here versus a lower volume and higher margin.” — Agence France-Presse