Canaccord Genuity raised its price target for Tesla (TSLA) from $815 to $881 after a visit to the Fremont Factory.
Canaccord analyst George Gianarikas visited the Fremont Factory last Friday and was impressed. In a note, Gianarikas wrote that Canaccord was “mesmerized by the factory’s chaotic symphony and employee morale.”
The Canacoord analyst also had a few good things to say about management at the Freemont Factory, reported Proactive Investors. He was particularly impressed by the management’s ability to maximize the factory’s capabilities given its limited size.
Elon Musk and other Tesla executives have noted that the company has outgrown the Fremont Factory. However, Tesla has still managed to improve its efficiency. Gianarikas believes the Fremont Factory’s efficiency separates it from other OEMs.
“Tesla’s manufacturing proficiency sets it apart from its tech peers and from other auto OEMs, who are years behind in terms of working out idiosyncrasies in building EVs versus ICE while managing a new supply chain reality,” he wrote.
Canaccord’s Forecast for Tesla
“While macroeconomic factors and recent price increases can certainly impact order rates, we estimate Tesla’s EV momentum and competitive lead – from manufacturing to materials procurement, to autonomy – is secured for some time. With additional offerings in solar, energy storage, and more to come, Tesla remains the sustainability behemoth,” concluded Gianarikas in his note
Tesla’s Gigafactory Roadmap
Tesla’s newer factories in China, Berlin, and Austin have more efficient layouts than the Fremont Factory’s assembly lines. Tesla has also made it a practice to improve and build on its factories constantly.
For instance, Giga Shanghai was the first factory to follow the layout of Tesla’s GA4 tent, where Model 3 production was refined. Berlin and Austin follow the same format.
Tesla might announce a new gigafactory location by the end of the year. Elon Musk estimates that Tesla might build 10 to 12 gigafactories to reach its goals.