Investors have been watching Tesla (NASDAQ:TSLA) stock closely since the company confirmed its 3-for-1 stock split. But this weekend brought more good news in a different category. On Sunday, Aug. 14, Elon Musk tweeted that the number of Tesla vehicles produced worldwide has surpassed 3 million.
Given the supply chain and production constraints that the electric vehicle leader has faced this year, that is no small feat. TSLA stock is rising today on a steady, upward trajectory. This growth may have more to do with broader market forces than company-specific news, but Tesla’s milestone still hints at a more prosperous future.
The 3-million benchmark demonstrates that the company will not be held down, no matter how many supply chain and labor constraints it encounters.
Let’s take a look at the bigger picture.
What This Means for TSLA Stock
Tesla crossed this important production threshold at its Shanghai Gigafactory, a facility whose doors were closed only a few months ago. Yesterday, Musk tweeted the following, acknowledging its efforts:
Congrats Giga Shanghai on making millionth car! Total Teslas made now over 3M. pic.twitter.com/2Aee6slCuv
— Elon Musk (@elonmusk) August 14, 2022
Investors should that Tesla reached the 3-million mark with two only factories doing most of the work for much of 2022. Barron’s reports that the Shanghai and Fremont factories were the driving forces that pushed production this far. As the outlet notes:
Tesla started shipping vehicles out of Shanghai around the start of 2020. It took that plant less than two years to hit 1 million units shipped. The Fremont plant took almost 10 years to ship the same amount. Of course, Tesla added new, lower-priced models, starting with the Model 3 back in 2017.
It added, though, that Tesla is working hard to ramp up production both in Austin and Berlin. If the company can successfully do that, it can scale production significantly in the months ahead. This should be particularly encouraging for investors. InvestorPlace analyst Louis Navellier recently weighed in on concerns about slow growth at these two facilities:
Looking beyond the headline quote, the idling at Tesla’s Berlin and Austin Gigafactories is a classic, short-term challenge. These factories aren’t white elephants. They may indeed be burning through billions of dollars at the moment, but that is because of a specific issue — and it’s not lack of demand.
Tesla’s recent production success indicates that his forecast has held up. Less than two months later, TSLA stock has soared above $900 per share. As Navellier noted, EV demand has only increased and Tesla is redoubling its efforts to meet it.
Investors should take the 3 million milestone as a sign that TSLA stock is back on the path toward long-term growth.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.