The Day After: Market, Analysts React to L.A.-area Explosion (of Disbelief)

Given what Tesla revealed last night, it seemed appropriate to reference a movie from the early ’80s — an era from which the automaker’s “futuristic” Cybertruck appears to have emerged. Looking like a stainless steel pup tent with a delicatessen counter serving as a dash, the Cybertruck’s Thursday night reveal generated a critical mass of hot takes, resulting in an megaton-level explosion of ridicule heard to the farthest reaches of space.

Perhaps even on Mars.

While the term “half baked” appeared to be one of the more popular descriptors for the vehicle (and may be a contributing factor to the vehicle’s design), market analysts are a sober-minded crowd. Friday morning, they let loose.

CNBC has a good rundown of Wall Street’s reaction.

“In a night to be remembered for the Armored Glass fail, Tesla’s Cybertruck reveal will likely disappoint current pickup truck owners and we see the vehicle remaining a niche and not a mainstream product,” wrote Jeffrey Osborne in a note to investors, adding that the entry-level $39,900 version was, like the much-touted $35k Model 3, unlikely to ever see the light of day. The vehicle’s glaring lack of side mirrors and windshield wipers is evidence of a rushed launch, he said.

No mention was made of the tacky seam (weld?) at the apex of the Cybertruck’s triangle.

Emmanuel Rosner of Deutsche Bank wondered whether the pyramid-shaped vehicle was too polarizing, writing “what are the real battery ranges under working conditions, with a payload or while towing? A greatly reduced range would require commercial customers to opt for the higher trims, which could be significantly more expensive than their equivalent traditional pickups.”

He added that having the truck’s supposedly armoured window glass shatter during the reveal was “not a good start.”

Like many others, Bernstein analyst Toni Sacconaghi saw the makings of a niche vehicle in Cybertruck, rather than a serious challenger to high-volume offerings like the Ford F-150 and Ram 1500.

“We suspect Cybertruck will not materially impact Tesla’s financials, or investor sentiment, though its aggressive price raises the question of how healthy gross margins might be,” Sacconaghi wrote.

After gazing at the creation before him, Credit Suisse’s Dan Levy claimed the Model 3 and Model Y will be the company’s breadwinners for the foreseeable future. “We expect Cybertruck to be a lifestyle vehicle; but amid a highly radical design (unlike anything the industry has seen), it’s unclear to us who the core buyer will be,” he wrote.

Jed Dorsheimer of Canaccord Genuity was more bullish on the Cybertruck, claiming the introduction gives Tesla a presence in a segment previously reserved for other players. “The starting price point of $39,900 for the 250-mile-range, single-motor RWD design option was also a strong point as this positions the Cybertruck competitively in the middle of the lucrative truck market,” he wrote. Still, Dorsheimer admitted the design was “polarizing.”

There’s nothing wrong with wild, polarizing styling, as such things keep the world a vibrant and exciting place. But Tesla’s creation inspired more questions than answers. Where will it be built? How is this model going to get off the ground a year after the Model Y, a vehicle whose production is also peppered with questions of capacity? Is rear-seat headroom all that hot? Can the design stay as-is in a world that demands stringent pedestrian safety standards?

We await the answers.

Tesla’s stock sank 5.7 percent in early Friday trading.

Tesla Truck is gonna have traditional F150 buyers FLOCKING… to Ford dealerships. Every single car vlogger is gonna buy one though.

Still not going to believe the design till I see one on the road.

— EngineeringExplained (@jasonfenske13) November 22, 2019

[Images: Tesla]