Investing.com - Shares of Tesla opened with solid gains on Monday after its CEO Elon Musk announced over the weekend plans to sell a new version of the Model 3 that would cost $78,000, more than twice the $35,000 price tag of the base model.
Musk said that the new version would be faster and more powerful with a dual motor and all-wheel drive.
The new version will have a top speed of 155 miles per hour, a 310-mile range and acceleration from standstill to 60 miles per hour in 3.5 seconds, Musk indicated, explaining that one of the motors is optimized for power and the other for range.
He also noted that one of the motors could break down and the car would still run. “(It) helps ensure you make it to your destination and don’t get stuck on side of road in potentially unsafe conditions,” Musk tweeted.
Separately, Tesla shares could also be seeing some upside from a positive analyst note on Monday.
Berenberg analysts suggested that the 11% year-to-date loss in shares was overdone and showed confidence that Tesla would meet its forecast for a 25% gross margin.
“The widespread assumption that Model 3 margins can be directly inferred from Model S/X is inherently and almost totally flawed,” these experts said.
“Substantial gains from lower labor content, as well as capital and material use efficiencies, should allow Tesla to comfortably achieve a margin above 25% throughout the product cycle,” they explained.
Berenberg reiterated its buy recommendation and increased its price target to $500 from the prior $470.
Shares (NASDAQ:TSLA) were last up 2.02% at $282.40.