The public’s perception when it comes to change can be a difficult hurdle to clear, although Tesla appears to have turned a corner. By the end of 2013 the electric vehicle manufacturer had sold over 25,000 of its model S electric cars of which, during the fourth quarter last year, accounted for 6,900 of them, showing that momentum was beginning to build.
On top of public perception infrastructure is also proving to be a testing issue for the firm. Convincing many of the US states to provide facilities for charging the vehicles has often been slow, and in many cases acrimonious. As such, there are still large parts of the country where the practicalities of owning the vehicle are prohibitive. In contrast to this, Norway has taken to electric vehicles with gusto. February’s car sales figures show that, due to government tax incentives, 20% of cars sold in that month were electric and 10% were Tesla. Scandinavian countries have a reputation for being more environmentally friendly and forward thinking, but this does show what could be achieved.
The drop in the share price over the last two months has partially been attributed to an issue that has arisen from crashes. These incidents have highlighted the need for protective steel panels to be added to previously manufactured vehicles to prevent fires after collisions.
At present, the shares are being propped up from support derived from the October 2013 highs around $194.50, along with the 100-day moving average. As long as the shares can continue closing above these levels, we would anticipate a recovery in the share price. It is likely to Initially look at tackling the $220 level before ultimately retesting the all-time highs above $250.