By Vlad Schepkov
Global Equities Research has shared its rather grim outlook for the Electric Vehicle (EV) industry, after Tesla (NASDAQ:TSLA) announced yet another round of price cuts earlier today.
In their latest note, the analysts warned that with tech layoffs continuing and "accelerating recession," the "EV and automotive sales will continue to remain weak."
They noted that despite today's cuts - TSLA reduced the pricing range on Model 3 to $40K-$52K from $42K-53K, and on Model Y to $47K-54K from $50K-$57K - the vehicles are still "priced out of market," and they believe "more price cuts are needed in this brutal recession."
As such, they warned that Rivian Automotive Inc (NASDAQ:RIVN), Lucid Group Inc (NASDAQ:LCID), Fisker Inc (NYSE:FSR) "may go bankrupt," as the companies simply won't be able to stay competitive given "the scale and operating efficiencies of TSLA." The analyst also sees plummeting sales for luxurious EVs sold by Porsche (OTC:POAHY) and Mercedes (OTC:MBGAF), noting those are "priced out of the market."
LCID, RIVN and FSR all opened 3-4% lower on Wednesday in the wake of the news.
TSLA is also trading 3% lower, as investors fear the price cuts will eat into the company's margins.