News
Tesla bull calls battery cost declines “good deflation” that could boost EV sales
Longtime Tesla bull ARK invest recently identified battery cost declines as a form of “good deflation” that could lead to a boost in EV sales.
To support its observations, ARK Invest used the 2022 Nissan Leaf EV’s price as an example. A few years ago, Nissan announced that the 2016 Leaf SV and SL variants would come standard with its 30kWh battery pack for an EPA-rated 107 miles of range. Nissan’s suggested manufacturer’s prices for the SV and SL were $34,200 and $36,790, respectively. ARK calculated that the 2016 Nissan Leaf would cost ~$39,000 in today’s dollars.
Today, the 2022 Leaf with a 40 kWh battery pack costs $27,400, that’s $11,600 less than the 2016 version with an additional range of 42 miles. The Nissan Leaf’s pricing reveals that it costs less to produce an EV with more milage today than five years ago.
Battery cost declines could decrease EV production costs and improve range, which may boost electric vehicle sales in the long run. An increase in electric vehicle sales could lead to growth in the EV market.
In contrast to “good deflation,” ARK also identified an example of “bad deflation” in the auto industry, specifically in the used car market. The investment management firm noted a decline in used car prices over the past few months, indicated by the Manheim Used Vehicle Index.
“While [ARK Invest] believe[s] the decline in battery costs is likely to translate into lower prices, boosting EV sales, the drop in used car prices could be signaling weakening demand for traditional gas-powered cars,” wrote Sam Korus in ARK’s newsletter.
In its July 2021 publication, The Manheim Market Report (MMR) stated there were declines in prices every week last month. The used car market saw price declines accelerating through mid-July that slowed over the last two weeks. The MMR did not differentiate between used gas-powered vehicles or second-hand cars.
However, the used car market for EVs seems to be growing. Some countries, including the United States and Canada, are already considering tax credits and rebates for second-hand EVs.
As a frontrunner in the latest EV revolution, Tesla seems to be leading the charge in the used car market for electric vehicles as well. After making headways in the new passenger car market, the Tesla Model 3 had become a dominating force in the used car market in countries like the United States and the United Kingdom.
Given everything discussed above, it seems both forms of deflation ARK Invest discussed suggest that EV sales will increase, both in the new and used car market. More governments worldwide are readily committing to decreasing carbon emissions and transitioning to clean energy sources which would greatly affect the future of the auto market as well.
The Teslarati team would appreciate hearing from you. If you have any tips, reach out to me at maria@teslarati.com or via Twitter @Writer_01001101.
Investor's Corner
Tesla gets its latest short from Michael Burry: ‘Happy it jumped back to this level’
Tesla short seller Michael Burry, the subject of the film “The Big Short,” where he was portrayed by Steve Carell, has revealed he has opened a new bet against the stock.
In a new update to his Substack newsletter in a post titled “Trading Post June 30, 2026,” Burry revealed a new set of bets against Tesla, Caterpillar, NVIDIA, Applied Materials Inc., and the iShares Semiconductor ETF.
In regard to Tesla, Burry wrote:
“And finally I shorted Tesla at 416.22. Happy it jumped back to this level.”
This means Burry likely opened his new short position after the company’s recent rally on Wall Street, which saw Tesla shares sink in mid-May, only to recover to well over the $400 mark. Currently, shares trade at around $427.
The company saw a big Tuesday as shares climbed considerably, over 10 percent. The size of the Tesla short was not provided, nor did Burry give any information on the position’s structure, the number of shares, dollar value, or whether options were used in the short.
The Tesla and SpaceX merger everyone is talking about is quietly building
Over the years, Burry has been one of the more vocal critics of Tesla, calling its share price “media inflated,” and saying it was “ridiculously overvalued” as recently as December.
The company has largely transitioned away from being known as an automotive company and instead is much more widely regarded as an AI play, mostly due to its Full Self-Driving efforts, Optimus robot development, and data collection related to both.
This has not pulled those skeptics away from being vocal about their distaste for how Tesla is valued, but there’s no denying that the company is a global force in many things, including sustainable energy, automotive, and AI.
Wedbush Securities is initiating stock coverage on SpaceX (NASDAQ: SPCX), marking the first comments on the company since it went public several weeks ago. Wedbush and its analyst handling coverage, Dan Ives, are widely bullish on fellow Musk company Tesla (NASDAQ: TSLA).
Ives wrote his first note initiating coverage of SpaceX shares on Wednesday with a $190 price target and an ‘Outperform’ rating. The firm believes the company is well positioned off of its IPO because of its wide array of projects, including AI compute power and infrastructure, connectivity projects, and launches.
“We view SpaceX as one of the most differentiated assets within the tech market with a strong footprint across its three core markets, with Starlink driving success with connectivity,” Ives wrote, “Starship launches leading to a demand flywheel and increasing deal flow for its Colossus clusters.”
Elon Musk called it Epic: The full story of SpaceX’s Starship Flight 12
Wedbush leans heavily on Starlink, which they say is the “profitability driver given the strength of its recurring revenue base of ~12 million subscribers as of June 5th.” Ives believes Starlink is still in the “early innings” of penetrating the global telecommunications and broadband market, as it only holds less than a 1 percent share. However, this number is sure to increase over time.
It also highlights the importance of Starship, which it says is an “essential layer” of SpaceX’s overall success. SpaceX developing and displaying the ability to reuse rockets is a major cost and reliability advantage “as it reduces the necessary hardware launch costs while generating a feedback loop for future flights to improve their launch flight rate without accelerating capex spend.”
Finally, SpaceX’s recent AI/Compute projects are also very elementary, Ives writes. It is worth mentioning Wedbush said its $190 price target is derived from a valuation forecast that sees the company yielding roughly $2.48 trillion of implied enterprise value.
There are also some factors that Wedbush did not take into account with its initial coverage. The firm wrote in the note:
“We note that there is optional value coming from Starship’s accelerating scale towards sub-$200/kg unit economics, orbital data centers, and enterprise AI monetization as these factors could drive meaningful upside but these face major hurdles, so we do not take that into account with our valuation.”
SpaceX shares are down just over 2 percent today, trading at around $167 at the time of publication.
Tesla has expanded the footprint of a massive safety feature worldwide with a recent Software Update labeled as 2026.20.6. The expansion of the “Blind Spot Warning While Parked” feature represents the more widespread availability of the feature, which aims to prevent “dooring.”
Dooring is when a driver or passenger opens a car door into the path of an oncoming road user, usually a cyclist or motorcyclist. It is among the most common types of cycling accidents, the League of American Bicyclists says.
For this reason, Tesla created a feature that warns occupants not to open the door because an object is approaching. The feature will sound a chime, and it will also delay the opening of the door to prevent an incident.
The release notes state (via Not a Tesla App):
“If you attempt to open a door while an approaching object is detected in your blind spot (for example, a bicyclist approaching from behind) a chime sounds, and your door will not open upon initial button press. Wait a short time and press the button a second time to override the warning.”
Tesla initially rolled out this feature back in 2024 with the Model 3 “Highland.” However, it remained with the Model 3 exclusively for over a year; that was until Tesla added it to the Cybertruck this past Spring.
Now, it is making its way to the new Model Y, 2021 and newer Model S, and 2021 or newer Model X.
The prevention of dooring incidents could eliminate many injuries to cyclists, especially in an urban setting. Dooring accounts for 10-20 percent of bike-related crashes in major cities, and over 17,000 dooring-related incidents were treated in the U.S. over the course of a decade. These usually involve fractures, contusions, and head trauma.
Tesla gets its latest short from Michael Burry: ‘Happy it jumped back to this level’
SpaceX gets initial stock coverage from Tesla’s biggest bull
