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Why Tesla Stock Is Up Again Today

By Daniel Sparks – Nov 1, 2021 at 11:56AM

Key Points

  • Shares of Tesla are up by about 50% since Oct. 1.
  • The automaker is piloting a program to let owners of other manufacturers' electric vehicles recharge them at some Supercharger network stations.
  • Despite global supply constraints, new Model 3 orders in the U.S. are slated to ship in December.

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The electric vehicle maker now has a market capitalization well above $1 trillion.

What happened

Shares of Tesla (TSLA 4.73%) rose sharply again on Monday, extending last month's huge run-up for the stock into November.

The electric vehicle maker's stock was up by about 4.4% as of 11:43 a.m. EDT. This put its total gain since the beginning of October at about 50%. It also pushed the company's market capitalization even farther past the $1 trillion level it recently crossed.

Tesla's new Model S interior.

The new Model S interior. Image source: Tesla.

So what

While the primary reason for the growth stock's gain on Monday morning may simply be continued momentum from its torrid run last week, two other reports that are circulating could be helping as well.

First, the company announced on Monday that it is launching a pilot program under which it will make 10 of its Supercharger stations in the Netherlands usable for non-Tesla vehicles. Non-Tesla vehicles will pay more than Teslas for a charge, but a membership program that lowers the prices will be available, the company said. If the pilot program goes well, this could lead to a new revenue stream for the automaker.

Additionally, the company launched a leasing program in China that lets customers get their hands on Tesla vehicles with no down payment. While the aggressive leasing program could be good for demand, it also signals that the automaker is confident in its ability to ramp up production to meet the demand it already has. Otherwise, why bother initiating such an aggressive new financing option?

Now what

Tesla entered the fourth quarter with supply constraints. Shipment dates for some of its vehicles are more than four months out. However, new Model 3 orders in the United States are currently slated to ship in December. That supports the argument that Tesla expects it will be able to manage the faster production rates required to meet the rising demand it hopes to generate with its easier leasing option in China.

Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has a disclosure policy.

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