Elon Musk, the chief executive of Tesla (NASDAQ:TSLA), is a visionary but controversial figure. His comments about the relatively new electric pickup model, known as the Cybertruck, didn’t make TSLA stock investors happy. Yet, I encourage people to take a more upbeat, big-picture view of the Cybertruck’s disruptive potential.
Above all else, I want investors to be patient. Tesla’s most popular EV models weren’t blockbuster sellers overnight. Forward-thinking Tesla shareholders should count on Tesla to deliver another winner with the Cybertruck, even if it takes a while.
TSLA Stock and at Musk’s Remarks
Many people don’t seem to recall that TSLA stock actually rose in after-hours trading after Tesla released its third-quarter 2023 earnings data. The automaker’s profit margins were soft because of Tesla’s EV price cuts. However, the market expected this and was prepared for it.
What the market didn’t expect, though, was Musk’s remarks about the Cybertruck. Musk said during the third-quarter earnings conference call that he just wanted to “temper expectations for” the Cybertruck, and he certainly achieved that aim.
Musk warned about the “enormous challenges in reaching volume production with the Cybertruck and then in making a Cybertruck cash flow positive.”
Musk established a timeline that the market evidently didn’t approve of. Specifically, Musk estimated that “financially, it will take, I don’t know, a year to 18 months before it is a significant positive cash flow contributor.”
Additionally, the Tesla CEO guessed that the company would achieve an output rate of 250,000 Cybertruck units “probably… sometime in 2025.” Given the drop in TSLA stock, it appeared that the market didn’t want to wait that long for the Cybertruck production ramp-up.
The Cybertruck Will Upend the Market
Sometimes, short-term traders simply lack the patience and vision required. Tesla and Musk aren’t trying to make a quick buck with the Cybertruck.
Instead, Musk is preparing today to establish the gold standard of electric pickup trucks in 2024 or 2025. The Cybertruck has an “exoskeleton-based” design. This is a uni-body type of EV frame design that could make the vehicle stronger and lighter.
And, according to Barron’s, a lighter EV should permit “more miles of range per unit of battery capacity.” The Cybertruck will “be able to accept one megawatt direct current charging.” Consequently, it “will charge very fast with hundreds of miles of range delivered in minutes.”
Musk called the Cybertruck Tesla’s “best product ever” in the conference call. However, the market isn’t ready to believe it yet.
Short-term stock traders won’t be convinced until rival automakers are copying Tesla’s Cybertruck design. But by then, TSLA stock will already be much higher.
Buy TSLA Stock Amid Pessimism
Musk’s comments about the Cybertruck made some stock traders pessimistic about Tesla. That’s shortsighted thinking, though, as the Cybertruck’s full value will be realized in a couple of years.
Then, people will claim that the light, strong and fast-charging Cybertruck is the greatest thing since sliced bread. So, I recommend buying TSLA stock now, before the market appreciates the Cybertruck’s true potential.
On the date of publication, David Moadel 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.
