Tesla Motors (NASDAQ:TSLA) faces headwinds after the Space X Explosion and the reported defective models in the previous week. The American automotive company’s shares suffered and stayed in the red line as it got bombarded with an unexpected turn of events.
Space X Explosion
Elon Musk was completely shattered after the explosion of the Space X rocket in the middle of its routine. Space X runs under the collaboration of PayPal and Tesla Motors since 2002. Based on reports, the American aerospace manufacturerlost its Falcon 9 rockettogether with its $200 million payload after an explosion at a Cape Cane Canaveral.
On his Twitter, Elon Musk wrote “Loss of Falcon vehicle today during propellant fill operation. Originated around upper stage oxygen tank.Cause still unknown.More soon.”Shares of Tesla and SpaceX dropped on the day of explosion
Last Tuesday, SES (Euronext Paris and Luxembourg Stock Exchange: SESG) and SpaceX disclosed the plan toto launch SES-10 on a flight-proven Falcon 9 orbital rocket booster.
Prior to this incident, Tesla had confirmed that it will raise additional money at the end of the year after paying $422 million to its bond holders. Since the conclusion of the tie-up with Solar City, Tesla has been tossing cards to meet the goals of the partnership. And this unexpected circumstance just added on his cards on the table.
More defective products?
Few months ago, Tesla faced numerous accusations regarding its auto pilot mode and just recently a problem on its Model X’s Falcon Wing doors came up. In a video released on line , it showed that safety feature of the wing door was thought of being removed secretly.
Most of the auto experts retaliated that the company has just increased the risk of injury as the unit fails to determine real obstacles between the roof and the opening door. Tesla hasn’t released any official statement regarding the report.
Stock Performance
Last Friday, Shares of Tesla traded 5.3 percent to $200.77 with a market capitalization of 29.95 billion. It has a 52-week high of -21.93 percent and a 52-week low of 50.31 percent with an average volume of 3269400.
The short interest of the stock declined by 2.23 percent from the total short interest of 23.63 million disclosed by the Financial Industry Regulatory Industry.Despite the successive downfall of the stock, Tesla managed to rise by 11.76 percent since the start of the year. The American Automotive company has underperformed the S&P500 by 2.90 percent.
TradingBanks issued a Hold rating for the stock in light of the recent involvement of its units in serious incidents. The downtrend for the company's stock started in February and the series of accusations just pulled the stock lower. Adding to this, Tesla posted a disappointing second quarter earnings report. As most of the economists question that the rationale behind the merger with SolarCity (NASDAQ:SCTY) and these recent defective scenarios, expect a red candle for the automotive company until the end of the year.