Investor's Corner
Tesla Gigafactory 1 to see Panasonic’s new battery lines and new Grohmann machines in Q4
Tesla’s upcoming ramp this Q4 2018 is starting to look a lot more encouraging, as Gigafactory 1, the company’s battery and powertrain facility, is set to receive upgraded battery lines from Panasonic, as well as new machines from Grohmann Automation. With these upgrades in place, Tesla’s continued Model 3 push would likely be a lot smoother than the previous quarters.
It is no secret that the Model 3 production ramp has been difficult for Tesla. In an interview earlier this year, Elon Musk described the past twelve months as some of the most difficult and “painful” periods of his career. Despite being in “production hell” for the past year, though, Tesla has started hitting its stride with the manufacturing of the Model 3. This quarter alone, Tesla is aiming to produce 50,000-55,000 units of the electric car — a goal that even a longtime skeptic of the company believes is attainable at this point.
Inasmuch as Tesla would likely break its production records this Q3, the company is just around halfway done with its Model 3 ramp. Tesla expects to increase its output for the vehicle to 10,000 units per week sometime next year as it offers other trims like the $35,000 base Model 3, which will be fitted with a smaller battery pack. To accommodate this upcoming demand, Tesla’s Gigafactory 1 would need to be upgraded.
In a statement to Bloomberg, Tesla partner Panasonic Corp. has announced that it is poised to complete its planned upgrades to the facility’s battery cell production lines earlier than expected. Back in July, Panasonic announced that it would install three new battery cell production lines sometime at the “end of 2018,” but according to Yoshio Ito, head of Panasonic’s automotive business, the Japanese company is now aiming to complete the upgrades earlier than expected. Ito also noted that the bottleneck in Model 3 production had been the result of Panasonic’s challenges in meeting Tesla’s demand.
“The bottleneck for Model 3 production has been our batteries. They just want us to make as many as possible,” Ito said.
-->The completion of Panasonic’s upcoming upgrades to Gigafactory 1’s battery cell production lines comes amidst the arrival of new machines from Tesla Grohmann Automation, which are designed to boost the electric car maker’s production capabilities. Updates on the new Grohmann machines were related by analysts from Worm Capital who went on a tour of Gigafactory 1 back in August. According to the analysts, Tesla head of investor relations Martin Viecha noted that upgrades from Grohmann, which are set to be sent to Gigafactory 1 by the end of Q3 or the beginning of Q4, would help module production become three times faster and three times cheaper.
“Grohmann Engineering will help module production become three times faster, and three times cheaper, according to Viecha. Their new system will be sent to the Gigafactory by the end of Q3 or beginning of Q4. The Grohmann machine will be in Zones 1, 2, 3, and Tesla will be receiving three machines. The process was designed to alleviate the previous bottleneck in module production which delayed Model 3 production significantly. The machine is already built, and points to the advantage Tesla will have in building future Gigafactories. They have learned many painful lessons, but have a solid blueprint for porting the factory across the world.”
Tesla’s demand for battery cells is set to increase within the coming quarters. As the company sets its sights on more ambitious targets, upgrades to Tesla’s key facilities like Gigafactory 1 could be the determining factor on whether the electric car maker can smoothly ramp production or not. With Panasonic’s upgraded battery cell production lines and the new Grohmann machines, Tesla’s Q4 ramp could very well be the company’s most impressive yet.
Investor's Corner
Mizuho keeps Tesla (TSLA) “Outperform” rating but lowers price target
As per the Mizuho analyst, upcoming changes to EV incentives in the U.S. and China could affect Tesla’s unit growth more than previously expected.
Mizuho analyst Vijay Rakesh lowered Tesla’s (NASDAQ:TSLA) price target to $475 from $485, citing potential 2026 EV subsidy cuts in the U.S. and China that could pressure deliveries. The firm maintained its Outperform rating for the electric vehicle maker, however.
As per the Mizuho analyst, upcoming changes to EV incentives in the U.S. and China could affect Tesla’s unit growth more than previously expected. The U.S. accounted for roughly 37% of Tesla’s third-quarter 2025 sales, while China represented about 34%, making both markets highly sensitive to policy shifts. Potential 50% cuts to Chinese subsidies and reduced U.S. incentives affected the firm’s outlook.
With those pressures factored in, the firm now expects Tesla to deliver 1.75 million vehicles in 2026 and 2 million in 2027, slightly below consensus estimates of 1.82 million and 2.15 million, respectively. The analyst was cautiously optimistic, as near-term pressure from subsidies is there, but the company’s long-term tech roadmap remains very compelling.
Despite the revised target, Mizuho remained optimistic on Tesla’s long-term technology roadmap. The firm highlighted three major growth drivers into 2027: the broader adoption of Full Self-Driving V14, the expansion of Tesla’s Robotaxi service, and the commercialization of Optimus, the company’s humanoid robot.
“We are lowering TSLA Ests/PT to $475 with Potential BEV headwinds in 2026E. We believe into 2026E, US (~37% of TSLA 3Q25 sales) EV subsidy cuts and China (34% of TSLA 3Q25 sales) potential 50% EV subsidy cuts could be a headwind to EV deliveries.
-->“We are now estimating TSLA deliveries for 2026/27E at 1.75M/2.00M (slightly below cons. 1.82M/2.15M). We see some LT drivers with FSD v14 adoption for autonomous, robotaxi launches, and humanoid robots into 2027 driving strength,” the analyst noted.
Tesla stock (NASDAQ: TSLA) has landed an elusive “must own” status from Wall Street firm Melius, according to a new note released early this week.
Analyst Rob Wertheimer said Tesla will lead the charge in world-changing tech, given the company’s focus on self-driving, autonomy, and Robotaxi. In a note to investors, Wertheimer said “the world is about to change, dramatically,” because of the advent of self-driving cars.
He looks at the industry and sees many potential players, but the firm says there will only be one true winner:
“Our point is not that Tesla is at risk, it’s that everybody else is.”
The major argument is that autonomy is nearing a tipping point where years of chipping away at the software and data needed to develop a sound, safe, and effective form of autonomous driving technology turn into an avalanche of progress.
Wertheimer believes autonomy is a $7 trillion sector,” and in the coming years, investors will see “hundreds of billions in value shift to Tesla.”
A lot of the major growth has to do with the all-too-common “butts in seats” strategy, as Wertheimer believes that only a fraction of people in the United States have ridden in a self-driving car. In Tesla’s regard, only “tens of thousands” have tried Tesla’s latest Full Self-Driving (Supervised) version, which is v14.
Tesla Full Self-Driving v14.2 – Full Review, the Good and the Bad
When it reaches a widespread rollout and more people are able to experience Tesla Full Self-Driving v14, he believes “it will shock most people.”
Citing things like Tesla’s massive data pool from its vehicles, as well as its shift to end-to-end neural nets in 2021 and 2022, as well as the upcoming AI5 chip, which will be put into a handful of vehicles next year, but will reach a wider rollout in 2027, Melius believes many investors are not aware of the pace of advancement in self-driving.
Tesla’s lead in its self-driving efforts is expanding, Wertheimer says. The company is making strategic choices on everything from hardware to software, manufacturing, and overall vehicle design. He says Tesla has left legacy automakers struggling to keep pace as they still rely on outdated architectures and fragmented supplier systems.
Tesla shares are up over 6 percent at 10:40 a.m. on the East Coast, trading at around $416.
Investor's Corner
Tesla analyst maintains $500 PT, says FSD drives better than humans now
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Tesla (NASDAQ:TSLA) received fresh support from Piper Sandler this week after analysts toured the Fremont Factory and tested the company’s latest Full Self-Driving software. The firm reaffirmed its $500 price target, stating that FSD V14 delivered a notably smooth robotaxi demonstration and may already perform at levels comparable to, if not better than, average human drivers.
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Analysts highlight autonomy progress
During more than 75 minutes of focused discussions, analysts reportedly focused on FSD v14’s updates. Piper Sandler’s team pointed to meaningful strides in perception, object handling, and overall ride smoothness during the robotaxi demo.
The visit also included discussions on updates to Tesla’s in-house chip initiatives, its Optimus program, and the growth of the company’s battery storage business. Analysts noted that Tesla continues refining cost structures and capital expenditure expectations, which are key elements in future margin recovery, as noted in a Yahoo Finance report.
Analyst Alexander Potter noted that “we think FSD is a truly impressive product that is (probably) already better at driving than the average American.” This conclusion was strengthened by what he described as a “flawless robotaxi ride to the hotel.”
-->Street targets diverge on TSLA
While Piper Sandler stands by its $500 target, it is not the highest estimate on the Street. Wedbush, for one, has a $600 per share price target for TSLA stock.
Other institutions have also weighed in on TSLA stock as of late. HSBC reiterated a Reduce rating with a $131 target, citing a gap between earnings fundamentals and the company’s market value. By contrast, TD Cowen maintained a Buy rating and a $509 target, pointing to strong autonomous driving demonstrations in Austin and the pace of software-driven improvements.
Stifel analysts also lifted their price target for Tesla to $508 per share over the company’s ongoing robotaxi and FSD programs.
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