By Sam Boughedda
Investing.com -- Bernstein analyst Tony Sacconaghi said in a note to clients Wednesday that Tesla Inc (NASDAQ:TSLA) not working on a $25,000 is a huge bet and potentially risky for the company.
On a recent earnings call, Tesla stated that the company is not currently working on a $25K car, but Sacconaghi said without offerings that address mass-market price points — under $30k — they "struggle to see how Tesla will be able to grow at 50%+ beyond 2023, which implies 3M units in 2024 and nearly 5M in 2025.”
"We note that during its hyper growth period, Apple (NASDAQ:AAPL)'s R&D spending lagged, leading to a period of fewer product introductions and weaker growth – and we worry about that potential risk at Tesla," the analyst added.
Sacconaghi stated that building a $25k entry-level car will require a significant cost take out for the company, which his firm feels can only be done via a "fundamental redesign.”
Overall, the analyst — who has an underperform rating and a $300 price target on Tesla — says it is unlikely the company will offer a $25k vehicle before 2025.
Tesla shares are down 0.5% Wednesday.