2016 was both a bad and a good year for Tesla Motors. Whether it was amazing reveal of Model 3, the first affordable electric car ($35,000) by the automaker, or the shocking merger of SolarCity and Tesla Motors, the year 2016 was pretty important for the car company. For investors, however, the year could not be as good as they expected.
The Ups and Downs of 2016 for Tesla Motors
The stock of the automaker is set to finish the year in the red, it is off nearly 9% right now. The electric car maker shocked mostly everyone in the Wall Street when it bought the solar energy company. The Chief Executive Officer of Tesla Motors, Elon Musk, who also has the major share in both the companies, believed the merger was important for SolarCity, a struggling solar installer, and Tesla Motors.
Musk, who is the Chairman in the Solar Company, said on CNBC’s “Squawk Alley” that they really want a future where all cars are electric and where all power is clean and sustainable. He further added, “If you have solar panels, batteries and electric cars, you have a complete solution to a sustainable energy future … it’s just critical that all three pieces are there.”
The CEO of Tesla believes that the acquisition of SolarCity will be profitable for Tesla Motors and the solar company in the future. However, investors think that the merger with the clean energy company took the focus of the automaker off the main subject: Electric cars. Investors said they do not what Musk is thinking. This years’ chart of the automaker looks like a rollercoaster, sometimes the value of Tesla’s Stock is hiking while sometimes it is declining.
2017: An important year for Tesla Motors
In the last month and half, however, the stock of the automaker has been rallying. This was not supposed to happen. Most of the people in the tech sector were expecting the car company to get hammered after the victory of Donald Trump in the U.S. presidential elections. This is because the upcoming government of Donald Trump has made it quite clear before and after the elections that his government would slash spending in clean energy whereas the automaker has benefitted mostly from green energy.
It is possible that the automaker is now just riding the coattails of the market which rallied sharply after the victory of Trump in the US elections. Also, it is possible that maybe the fact that it is attempting to do much of its manufacturing in America could be an advantage if the president-elect gets his way and taxes are only imposed on products that are manufactured outside the country.
Whatever happens, it will be important for investors to keep a close eye on Tesla Stock in 2017. The shares of the electric car making giant have dropped 0.3% to $218.82 at 11:52 a.m. yesterday.