Tesla's (TSLA) anticipated "Battery Day" event is slated to begin later today at 4:30 E.T. In the days leading up to the event, Elon Musk usually makes some dazzling proclamations, fueling the hype.

Musk continued that trend this year, tweeting on September 11, "Many exciting things will be unveiled on Battery Day 9/22." The tweet followed a comment during TSLA's 4Q20 earnings conference call in January, when he stated that Battery Day "is going to actually blow people's minds."

The hopium high traders and investors feel is hinged on game-changing announcements today, the stock has soared by ~35% over the past two weeks.

The dramatic collapse of competitor Nikola (NKLA) has added to TSLA's momentum. Following reports that NKLA is under investigation by the SEC for fraud, the company announced yesterday that its Executive Chairman, and Chief Huckster, Trevor Milton, is stepping down.

As always, while enthusiasm for TSLA continued to build, Musk pumped the breaks and per-emptively came up short. Musk rained on the parade by tweeting, "Important note about Tesla Battery Day unveil tomorrow. This affects long-term production, especially Semi, Cybertruck & Roadster, but what we announce will not reach serious high-volume production until 2022."

The disclosure per usual soured investors. It is disappointing because it suggests that the Cybertruck production timeline has been pushed out into 2022. Previously, the Cybertruck was expected to hit full-scale production in late 2021.

Sentiment soured further when Musk tweeted that he still foresees future battery cell shortages "unless we also take action ourselves."

  • Currently, Panasonic, LG Chemical, and China's CATL supply battery cells to TSLA.

  • While the company will increase purchases from those three suppliers, it will need to heavily invest in its own manufacturing facilities.


A key topic of interest is battery costs, since they account for ~30% of EV production costs, making EVs unaffordable for many consumers.

  • Musk is expected to focus on how EVs will surpass gasoline-powered vehicles, many market participants believe that Musk will divulge some positive updates on battery costs.

  • Some analysts, including Credit Suisse's Dan Levy, think that TSLA may introduce a $75/kilowatt hour battery cell.

    • That would represent a significant revelation because $100/kilowatt hour is widely viewed as key benchmark for EV makers to reach.

There is also speculation that TSLA may unveil a "million-mile battery", which would create the possibility of reusing a battery in new vehicles.

Undoubtedly, Musk will attempt to grease his stock at the event today. The question is when, and if, TSLA will make good on Musk's predictions. As seen in the indicated push-out for Cybertruck production, Musk's timelines will unlikely be fulfilled.

TECHS

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