Latest News Tesla shares fall in premarket as Musk dampens 'battery...

Tesla shares fall in premarket as Musk dampens ‘battery day’ expectations

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Elon Musk, CEO of Tesla, stands on the construction site of the Tesla Gigafactory in Grünheide near Berlin, September 3, 2020.

Patrick Pleul | picture alliance | Getty Images

Tesla shares sank 4% in premarket trading Tuesday, after CEO Elon Musk sought to manage expectations ahead of the electric carmaker’s “battery day” presentation.

Musk’s firm is expected to announce on Tuesday details about a new type of battery cell it has developed. Analysts had hoped the technology could help Tesla maintain its edge over rivals in the electric vehicle space, but Musk dampened such hopes Monday when he cautioned about hurdles to reaching mass production.

“Important note about Tesla Battery Day unveil tomorrow,” Musk stated via Twitter, often his go-to for communications about the company. “This affects long-term production, especially Semi, Cybertruck & Roadster, but what we announce will not reach serious high-volume production until 2022.”

The billionaire said Tesla would increase battery cell purchases from suppliers Panasonic, LG and CATL, but warned “we still foresee significant shortages in 2022 & beyond unless we also take action ourselves.” Tesla has built a prototype manufacturing line for battery cells at a lab in in Fremont, California, near the company’s U.S. car plant.

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Tesla shares fell over 6% in after-hours trading as a result, after closing almost 2% higher on Monday at $449.39. Still, shares of the firm are up over 400% year-to-date on the back of a stock split and optimism around entry into the S&P 500. On Tuesday, the firm’s shares slipped about 4% in premarket to trade around $431.

– CNBC’s Lora Kolodny contributed to this report.

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