Tesla Inc. (NASDAQ: TSLA) unveiled its crossover electric SUV Model Y on Thursday night, but investors and analysts didn’t seem to be impressed as share prices edged lower. Tesla shares slipped by 4.4% on Friday morning after the opening bell.
Chief Executive Officer Elon Musk unveiled the latest Tesla model in Hawthorne, California. The vehicle will start a base-price of USD 39,000 and a 230 mile battery range. The long range model can travel up to 300 miles. The Model Y is also expected to use 75% of the same parts of the Model 3, said Musk.
Tesla intends to sell the more expensive version of the Model Y first before releasing the shorter range models. The long-range Model Ys are expected to cost between USD 47,000 and USD 60,000.
According to Tesla’s site, the Model Y can come with all wheel drive and dual motor. The vehicle also holds up to 66 cubic feet of cargo space. The vehicle can accelerate from 0 to 60mph in just 3.5 seconds. Tesla also highlights that the Model Y can recharge 168 miles in just 15 miles at a Supercharger location.
Similar to other Tesla models, the Model Y has 360 degree camera to provide maximum visibility. The vehicle also has a 160m forward facing radar to detect long-range objects and 12 ultrasonic sensors to detect vehicles in its vicinity as well as help with parking. The model will also come with an autopilot option, allowing it to have full self-driving capability. The autopilot also includes emergency auto breaks, collision warning, blind-spot monitoring, and more.
However, the details of the Model Y didn’t seem to impress analysts, as most said the unveiling held no surprises for them.
The big concerns regarding the Model Y was its shipment and production dates. Tesla said it doesn’t intend to begin shipping the Model Y until 2020. Investors and Tesla customers had hoped to hear other changes regarding vehicle models such as software updates.
Cowen analyst Jeffrey Osborne also said the “Model Y reveal underwhelmed us,” especially since “the night held no surprises.” Osborne said investors were looking for a refresh to the Model S and Model X lines, new software or even details on how Tesla’s first quarter is going.
The production line also concerns many especially after the Model 3 incidents. Tesla had trouble producing and delivering the Model 3 when it was first unveiled and allowed customers to place orders. Due to the production issues, Tesla ended up pricing the Model 3 at a higher price than its intended USD 35,000 base price. Customers had also complained that they were not receiving their vehicles on time and most had to wait several months for receive their vehicle.
“With the Model Y vehicle only priced at a $4k premium to the Model 3, we think investor focus will hone in on potential cannibalization of already waning Model 3 demand and the company delivering on margins as it moves to larger scale production. And with no incremental products unveiled (like the pickup truck the company is working on or a potential refresh of the S/X) and no further commentary on Model 3 demand (which investors have been looking for), we think shares could see pressure in trading today. … we estimate the company is likely to see between 200k and 400k orders (in totality) for the product given consumer preferences for utility vehicles vs. sedans.” said Goldman Sachs analysts.