Tesla Soars Over 20% on Musk's Remarks: "Car Sales to Increase by 30% Next Year"

Largest Daily Increase Since May 2013

U.S. electric vehicle company Tesla is surging more than 20%. The better-than-expected third-quarter earnings this year, along with CEO Elon Musk's remarks that vehicle sales could increase by up to 30% next year, have stimulated investor sentiment. Tesla, experiencing its "best day" in 11 years, saw its market capitalization increase by $100 billion (approximately 138 trillion KRW) in a single day.

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As of 2:29 p.m. on the 24th (local time) in the New York stock market, Tesla's stock price is trading at $257.7 per share, up 20.62% from the previous day. This marks the largest daily gain in 11 years and 5 months since May 2013, when the stock price surged 24% in one day.

The surge in Tesla's stock price is driven by earnings that exceeded Wall Street expectations announced the previous day. The company reported after market close that its third-quarter revenue was $25.182 billion, with earnings per share (EPS) of $0.72. Market research firm FactSet had previously expected Tesla to achieve $25.5 billion in revenue and an EPS of $0.6 for the period, so the EPS surpassed market forecasts.

Tesla's profits had declined recently due to cutthroat competition involving price reductions with Chinese companies last year. However, strong sales of carbon emission credits and energy storage system (ESS) business, along with reduced cost of sales, led to higher-than-expected net income in the third quarter. In particular, Tesla receives credits from the government for reducing carbon emissions through pure electric vehicle sales, which it sells to other companies with high carbon emissions, generating $739 million in revenue.

Following the earnings announcement, CEO Musk's comments also pushed the stock price higher. He predicted that electric vehicle prices would decrease due to cost-cutting efforts, leading to a 20-30% increase in vehicle sales next year. This significantly exceeds FactSet's forecast of 15% growth for next year.

In the conference call the previous day, Musk also mentioned the 'Cybercap,' a prototype of the autonomous robo-taxi unveiled earlier this month. He set a goal to start mass production of the Cybercap in 2026 and sell 2 million units annually. He also noted that recent interest rate cuts have reduced vehicle installment payments, resulting in meaningful changes in demand.

Additionally, Musk urged the federal government to approve fully autonomous vehicles that operate without human supervision to drive on any road nationwide, stating, "if the government has an efficiency department, it will strive to realize this." Former President Donald Trump, the Republican presidential candidate, has announced plans to establish a 'Government Efficiency Commission' to eliminate unnecessary corporate regulations during his administration and appoint Musk as a member. Musk is fully committed to Trump's election, having donated $75 million (approximately 104 billion KRW) in campaign funds to him.

U.S. investment bank Morgan Stanley analyzed Musk's forecast of 20-30% sales growth next year, stating, "It depends on whether the company can improve purchase potential through launching more affordable models, financing offers to consumers, and feature enhancements."

Previously, Morgan Stanley had forecasted a 14% growth in Tesla vehicle sales next year. The investment rating for Tesla was given as 'Buy.'