By Michael Elkins
UBS reiterated a Buy rating and $220.00 price target on Tesla, Inc. (NASDAQ:TSLA) following the seventh wave of the UBS Evidence Lab EV consumer survey.
The survey, which included over 10k participants, shows that 46% of consumers are likely to consider buying a fully electric car (BEV), a 3% pts decrease y/y. This is the first sequential decline since the survey's inception in 2016, driven by European markets on affordability concerns. Tesla kept its lead in the brand survey with 42% of BEV purchase intenders considering buying a Tesla, vs. 41% last year.
UBS analysts wrote in a note, "Tesla keeps its lead in the brand survey with 42% of BEV purchase intenders considering to buy a Tesla. In China, Tesla lost its top rank for the first time to BYD; now these two brands lead all others by a wide margin. Amongst legacy OEMs, German premium brands gained territory by ~200-300bps y/y whereas mass-market brands showed flat to negative momentum on a global basis. In combination with continued execution issues and gradually growing international popularity of Chinese brands (even though still at a low level), EV strategies of legacy mass-market brands look increasingly at risk as price competition intensifies."
Regarding the interest of US consumers in Tesla's Cybertruck vs. competing pick-up trucks, the survey showed the share of those preferring the Cybertruck remained well ahead of all competing EV trucks with a stable 12%. The analysts remain highly confident that the Cybertruck will become a margin-accretive product in 2024, adding ~$4bn incremental gross profit.
Shares of TSLA are down 1.02% in pre-market trading on Friday.