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Tesla should abandon the Semi and focus on its cars’ ‘quality issues’ first: analysts

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Amidst Tesla’s rise as the world’s most valuable automaker by market cap and the growth of its war chest thanks to its recent $5 billion capital raise, auto analysts have recently expressed doubt about whether the electric car maker should still pursue its Tesla Semi project. According to the analysts, it would be better for Tesla to abandon the Semi, and focus instead on improving its current vehicle lineup. 

Michael Ramsey, a Gartner vice president and automotive analyst, stated that the Semi is a “distraction” for Tesla at this point, seeing as the long-haul trucking segment is a completely different business. The analyst stated that would be better for Tesla to spin off its efforts to another firm. “Tesla should drop or spin off its Semi efforts to someone else. It’s a different business and a distraction,” Ramsey said. 

The Gartner analyst’s points were echoed by Sam Abuelsamid from Guidehouse Insights, who likened the Tesla Semi to the Nikola Badger, a vehicle that was recently discontinued by Nikola Motors following its renegotiation deal with General Motors. Citing “quality issues” with Tesla’s present lineup of vehicles, the analyst argued that the electric car maker should get its manufacturing straightened out first. 

“The Semi is a distraction for Tesla,” Abuelsamid said in a statement to Freightwaves, adding that Tesla should “focus” on refining the quality of its current cars first. 

Tesla, for its part, did not respond to the trucking publication’s request for comment. 

Not all analysts are as pessimistic about the Tesla Semi. Garrett Nelson, a senior equities research analyst from investment research firm CFRA, stated that he is bullish on the all-electric Class 8 truck. Nelson noted that this year’s meteoric stock run-up provided Tesla with the capital necessary to accelerate growth, “and the Semi truck is an important part of the that.” The CFRA analyst further remarked that amidst Tesla’s ongoing projects, “2021 will be a year of execution.”

Despite the delays in the Tesla Semi’s release, companies that have placed orders for the all-electric Class 8 truck appear to be unfazed. When asked about its Semi orders, UPS noted in an emailed statement to Freightwaves that its relationship with Tesla is proprietary. “We have a good working relationship with Tesla, and they have been talking to us routinely about their plans. We look forward to receiving the Semis we’ve ordered, but have nothing more to share,” the UPS statement said. 

The post Tesla should abandon the Semi and focus on its cars’ ‘quality issues’ first: analysts appeared first on TESLARATI.


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