Tesla Analysis: Stocks May Rise on Battery Tech and Government-Enforced Switch to EVs

FXOpen

Over the past week, Tesla, the electric vehicle (EV) pioneer, has experienced a notable decrease in its stock prices. This decline came on the heels of a sharp drop in mid-July, where the value of Tesla stock fell from $293 per share on July 18 to $260 per share on July 21.

This has continued further, and Tesla stock now languishes at $251; however, a change has begun to make itself noticeable as the price began to rise a bit at the end of yesterday’s New York trading session.

Indicative pricing only

While Tesla is known for its volatile stock movements compared to other high-tech companies based in Silicon Valley, recent events have fueled the downward trend.

A significant factor contributing to this shift is the ongoing media discussion in the United Kingdom and other North American and European countries about the potential ban on fossil fuel-powered cars, possibly as early as 2030.

Additionally, concerns surrounding the environmental impact of battery production have created uncertainty in the EV industry. However, recent developments have shed light on Tesla's technological advantages, leading to a renewed surge in the company's stock prices.

The Shift Towards Electric Vehicles

The rise of electric vehicles has been gaining momentum in recent years, driven by increasing concerns about climate change and the desire for cleaner, more sustainable transportation solutions.

The United Kingdom and other countries' governments have been considering measures to ban the sale of new internal combustion engine (ICE) vehicles to accelerate the transition to electric cars. Whilst this appears extremely undemocratic and may not be enforceable, it is currently a hot topic. This shift towards EV adoption presents both opportunities and challenges for automakers, including Tesla.

While the prospect of a government-imposed ban on ICE vehicles may create a larger market for EVs, it also raises concerns about the environmental impact of battery production, specifically the mining of minerals like cobalt and lithium.

The Cobalt and Lithium Debate

The traditional narrative propagated by the anti-electric car lobby is that mining cobalt and lithium for EV batteries leads to environmental degradation and exploitative labour practices in certain mining regions. This argument has been a point of contention in the ongoing debate around the viability of electric cars.

However, recent developments have highlighted Tesla's unique advantage in this area. Approximately 50% of Tesla's car batteries on the road today do not use cobalt or lithium, reducing their reliance on these controversial minerals. Tesla's focus on battery research and development has also resulted in the potential use of manganese and iron as alternatives to cobalt and lithium. Additionally, solid-state battery technology is on the horizon, offering a promising solution to further reduce reliance on these minerals in the future.

Media Support and the Rise in Tesla Stock Prices

Over the past week, the conversation surrounding EVs and Tesla's environmental impact has undergone a remarkable transformation. Motoring experts and media channels that were once sceptical of electric cars have now rallied behind the EV movement.

The emergence of credible reports debunking the notion that electric car manufacturing is more damaging to the environment than traditional ICE vehicles has fueled social acceptance of electric cars.

As more support for EVs and Tesla's environmentally conscious battery technology becomes widespread, investor sentiment has improved. Investors are now betting on Tesla's ability to navigate the changing landscape of the automotive industry and capitalize on the growing demand for electric vehicles.

Conclusion

Tesla's stock prices have experienced fluctuations in recent weeks, primarily influenced by the ongoing discussions surrounding the ban on fossil fuel-powered vehicles and the environmental concerns surrounding battery production. However, the recent shift in media support towards electric vehicles and Tesla's innovative battery technology has revitalized investor confidence in the company.

As the world moves towards a cleaner and more sustainable future, Tesla's focus on EV technology and commitment to reducing the environmental impact of battery production position the company to profit from the growing market.

With an increasing number of countries considering a ban on the sale of new ICE vehicles, Tesla's stock prices are likely to be shaped by the company's ability to navigate these changing dynamics and maintain its leadership position in the EV market.

Buy and sell stocks of the world's biggest publicly-listed companies with CFDs on FXOpen’s trading platform. Open your FXOpen account now or learn more about trading share CFDs with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Stay ahead of the market!

Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.

Latest articles

   Weekly Market Wrap With Gary Thomson: GBP/USD, EUR/USD, USD/JPY, XAU/USD, NVDA Stock
Financial Market News

Weekly Market Wrap With Gary Thomson: GBP/USD, EUR/USD, USD/JPY, XAU/USD, NVDA Stock

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights.

  • GBP/USD Hits Four-Month
Analysis of USD/JPY: Was There an Intervention?
Forex Analysis

Analysis of USD/JPY: Was There an Intervention?

Yesterday’s news of slowing inflation in the US sharply weakened the dollar, anticipating the Federal Reserve’s monetary easing. In the first 15 minutes after the data release:

→ EUR/USD rose by approximately 0.45% to the psychological level

What Is a Parabolic Arc Pattern, and How Can You Trade It?
Trader’s Tools

What Is a Parabolic Arc Pattern, and How Can You Trade It?

The parabolic arc pattern is a significant formation in technical analysis, showcasing rapid, exponential price movements that signal significant bullish momentum followed by sharp reversals. This article delves into identifying, trading, and managing the risks associated with parabolic arcs.

Understanding

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.