Tesla suffered yet another setback in the stock market on Monday, after its CEO, Elon Musk, tweeted that the automaker’s production of the luxury Model S Plaid+ sedan will be cancelled.
The EV-maker’s shares plummeted by more than 2% come Monday in pre-market trading, and are currently down over 30% since a record-high of $885 at the end of January. On Sunday, Elon Musk tweeted that the high-end Model S sedan, called the Plaid+, has been cancelled, given that its lower-tier version—the regular Plaid— “is just as good.” Tesla has been accepting refundable deposits for the Plaid+ for the past several months.
The Plaid+ was slated for its debut via a “delivery” ceremony at Tesla’s Fremont, California facility on June 3. However, as the date neared closer, Musk delayed the launch to June 10, adding that the sedan still needed “one more week of tweak.” Now, potential Plaid+ customers are left disappointed even further, as a concrete reasoning behind Musk’s sudden cancellation was not provided.
It is likely that the ongoing global semiconductor chip shortage has finally caught up to Tesla’s production, particularly for its higher-end models. During the automaker’s first quarter earnings call, Musk revealed that the company faced an increasing number of technical challenges particularly surrounding internal electronics and infotainment systems.
The latest setback marks the second consecutive week that Tesla’s investors faced disappointment and negative press. Last week, the EV maker’s shares were sent plummeting after it was revealed that its Chinese sales significantly slumped last month. The less-than-dismal news also surfaced on the same day that a major US regulator announced recalls of the Model Y and Model 3 vehicles over separate seat-belt issues.
Information for this briefing was found via the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.