Investor's Corner
Tesla battery partner Panasonic sees higher Gigafactory output, cites Model S/X demand increase
Panasonic President Kazuhiro Tsuga recently discussed some details about the Japanese corporation’s existing operations with American electric car maker Tesla. According to the executive, Panasonic expects to see higher yields from Gigafactory 1 as operations get optimized, and there could be a potential upside in Model S and X demand as Tesla takes actions to make its flagship vehicles more attractive to consumers.
Tsuga’s comments about Tesla were a response to an inquiry during a Q&A session following Panasonic’s release of its fiscal 2019 financial results. Tsuga pretty much confirmed what Elon Musk mentioned on Twitter last month, stating that Gigafactory 1 is currently operating at about 24 GWh despite the facility having a theoretical capacity of 35 GWh. “For Tesla, 35 GWh initial investment has been completed already, and utilization as per Elon is maybe 24 GWh currently. This year, we want to increase this (utilization) rather significantly,” he said.
Explaining further, Tsuga noted that efficiencies in Gigafactory 1 should improve in the near future, particularly as its higher-speed production lines get optimized further. “Including the lines that have yet to start, we have three fast, higher speed lines, and when they become operational, we will see improved efficiency. And when we shifted tools, we were not really able to do sufficient verification of the facilities. We saw disruptions, and we now know the reasons. And so in June, we will start replacing the jigs, and therefore, the number of cells and the yield will improve quite a bit,” Tsuga said.
Among the improvements mentioned by the Panasonic President involved tapping into the local workforce for the Nevada Gigafactory. This, according to the executive, will ultimately lower fixed costs. Tsuga also noted that he expects the demand from Tesla to be good enough for the full capacity of its production lines on the site.
“Through the localization of the workforce, we will have fewer Japanese expats (on Gigafactory 1), and that is progressing. And we are seeing an increase in the number of lines that can be operated only by the local personnel, and that can reduce fixed costs as well. So overall, we can expect improvement. Of course, the demand from Tesla is going to be good enough for the full capacity (of our equipment), that is the assumption. Should that assumption hold, the Tesla battery business can break even this year (for Panasonic),” he added.
Particularly compelling were Tsuga’s comments about the demand for batteries used in Tesla’s flagship vehicles, the Model S and Model X, both of which utilize 18650 cells. While sales of the flagship sedan and SUV have seen a drop in recent months, the Panasonic President stated that demand for the Model S and X could increase once more, especially as Tesla takes the initiative to push the vehicle to customers. “As for Model X (and S), last quarter, we saw a decline, but Tesla is already making efforts and taking actions to revamp that demand. We’re talking with Tesla on this, and so there is upside potential there,” Tsuga said.
The comments from the Panasonic President about the Japanese corporation’s partnership with Tesla all but suggests that the two companies remain closely working with each other to improve the output of Gigafactory 1. Speculations about Panasonic moving away from its partnership with Tesla made the rounds in the media last month, fueled by a report from the Nikkei Asian Review which stated that the Japanese company is freezing its investments in the Nevada-based facility. Tesla responded to the Nikkei report when it was released, explaining that there is far more output to be gained by improving the facility’s existing lines than previously estimated. These comments seem to be in step with the Panasonic President’s recent statements.
Panasonic President Kazuhiro Tsuga’s discussion on Tesla could be accessed here (kindly skip to 33:28 in the video).
Investor's Corner
Tesla could save $2.5B by replacing 10% of staff with Optimus: Morgan Stanley
Jonas assigned each robot a net present value (NPV) of $200,000.
Tesla’s (NASDAQ:TSLA) near-term outlook may be clouded by political controversies and regulatory headwinds, but Morgan Stanley analyst Adam Jonas sees a glimmer of opportunity for the electric vehicle maker.
In a new note, the Morgan Stanley analyst estimated that Tesla could save $2.5 billion by replacing just 10% of its workforce with its Optimus robots, assigning each robot a net present value (NPV) of $200,000.
Morgan Stanley highlights Optimus’ savings potential
Jonas highlighted the potential savings on Tesla’s workforce of 125,665 employees in his note, suggesting that the utilization of Optimus robots could significantly reduce labor costs. The analyst’s note arrived shortly after Tesla reported Q2 2025 deliveries of 384,122 vehicles, which came close to Morgan Stanley’s estimate and slightly under the consensus of 385,086.
“Tesla has 125,665 employees worldwide (year-end 2024). On our calculations, a 10% substitution to humanoid at approximately ($200k NPV/humanoid) could be worth approximately $2.5bn,” Jonas wrote, as noted by Street Insider.
Jonas also issued some caution on Tesla Energy, whose battery storage deployments were flat year over year at 9.6 GWh. Morgan Stanley had expected Tesla Energy to post battery storage deployments of 14 GWh in the second quarter.
Musk’s political ambitions
The backdrop to Jonas’ note included Elon Musk’s involvement in U.S. politics. The Tesla CEO recently floated the idea of launching a new political party, following a poll on X that showed support for the idea. Though a widely circulated FEC filing was labeled false by Musk, the CEO does seem intent on establishing a third political party in the United States.
Jonas cautioned that Musk’s political efforts could divert attention and resources from Tesla’s core operations, adding near-term pressure on TSLA stock. “We believe investors should be prepared for further devotion of resources (financial, time/attention) in the direction of Mr. Musk’s political priorities which may add further near-term pressure to TSLA shares,” Jonas stated.
Investor's Corner
Two Tesla bulls share differing insights on Elon Musk, the Board, and politics
Two noted Tesla bulls have shared differing views on the recent activities of CEO Elon Musk and the company’s leadership.
Two noted Tesla (NASDAQ:TSLA) bulls have shared differing views on the recent activities of CEO Elon Musk and the company’s leadership.
While Wedbush analyst Dan Ives called on Tesla’s board to take concrete steps to ensure Musk remains focused on the EV maker, longtime Tesla supporter Cathie Wood of Ark Invest reaffirmed her confidence in the CEO and the company’s leadership.
Ives warns of distraction risk amid crucial growth phase
In a recent note, Ives stated that Tesla is at a critical point in its history, as the company is transitioning from an EV maker towards an entity that is more focused on autonomous driving and robotics. He then noted that the Board of Directors should “act now” and establish formal boundaries around Musk’s political activities, which could be a headwind on TSLA stock.
Ives laid out a three-point plan that he believes could ensure that the electric vehicle maker is led with proper leadership until the end of the decade. First off, the analyst noted that a new “incentive-driven pay package for Musk as CEO that increases his ownership of Tesla up to ~25% voting power” is necessary. He also stated that the Board should establish clear guidelines for how much time Musk must devote to Tesla operations in order to receive his compensation, and a dedicated oversight committee must be formed to monitor the CEO’s political activities.
Ives, however, highlighted that Tesla should move forward with Musk at its helm. “We urge the Board to act now and move the Tesla story forward with Musk as CEO,” he wrote, reiterating its Outperform rating on Tesla stock and $500 per share price target.
Tesla CEO Elon Musk has responded to Ives’ suggestions with a brief comment on X. “Shut up, Dan,” Musk wrote.
Cathie Wood reiterates trust in Musk and Tesla board
Meanwhile, Ark Investment Management founder Cathie Wood expressed little concern over Musk’s latest controversies. In an interview with Bloomberg Television, Wood said, “We do trust the board and the board’s instincts here and we stay out of politics.” She also noted that Ark has navigated Musk-related headlines since it first invested in Tesla.
Wood also pointed to Musk’s recent move to oversee Tesla’s sales operations in the U.S. and Europe as evidence of his renewed focus in the electric vehicle maker. “When he puts his mind on something, he usually gets the job done,” she said. “So I think he’s much less distracted now than he was, let’s say, in the White House 24/7,” she said.
TSLA stock is down roughly 25% year-to-date but has gained about 19% over the past 12 months, as noted in a StocksTwits report.
Investor's Corner
Cantor Fitzgerald maintains Tesla (TSLA) ‘Overweight’ rating amid Q2 2025 deliveries
Cantor Fitzgerald is holding firm on its bullish stance for the electric vehicle maker.
Cantor Fitzgerald is holding firm on its bullish stance for Tesla (NASDAQ: TSLA), reiterating its “Overweight” rating and $355 price target amidst the company’s release of its Q2 2025 vehicle delivery and production report.
Tesla delivered 384,122 vehicles in Q2 2025, falling below last year’s Q2 figure of 443,956 units. Despite softer demand in some countries in Europe and ongoing controversies surrounding CEO Elon Musk, the firm maintained its view that Tesla is a long-term growth story in the EV sector.
Tesla’s Q2 results
Among the 384,122 vehicles that Tesla delivered in the second quarter, 373,728 were Model 3 and Model Y. The remaining 10,394 units were attributed to the Model S, Model X, and Cybertruck. Production was largely flat year-over-year at 410,244 units.
In the energy division, Tesla deployed 9.6 GWh of energy storage in Q2, which was above last year’s 9.4 GWh. Overall, Tesla continues to hold a strong position with $95.7 billion in trailing twelve-month revenue and a 17.7% gross margin, as noted in a report from Investing.com.
Tesla’s stock is still volatile
Tesla’s market cap fell to $941 billion on Monday amid volatility that was likely caused in no small part by CEO Elon Musk’s political posts on X over the weekend. Musk has announced that he is forming the America Party to serve as a third option for voters in the United States, a decision that has earned the ire of U.S. President Donald Trump.
Despite Musk’s controversial nature, some analysts remain bullish on TSLA stock. Apart from Cantor Fitzgerald, Canaccord Genuity also reiterated its “Buy” rating on Tesla shares, with the firm highlighting the company’s positive Q2 vehicle deliveries, which exceeded its expectations by 24,000 units. Cannacord also noted that Tesla remains strong in several markets despite its year-over-year decline in deliveries.
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