Tomahawk, WI 08/04/2014 (Basicsmedia) – Tesla Motors Inc. (NASDAQ:TSLA) is poised to define the automobile sector in the coming months as opposed to General Motors Company (NYSE:GM) that is currently trying to clear its name after the faulty ignition-switch problems tainted its image. Tesla Motors has already announced quarterly earnings and revenue that beat Wall Street estimates at the back of investing heavily on the launch of a new SUV as well as starting working, on a massive new battery plant.
“If you want to get some dollars get Tesla Motors Inc. (NASDAQ:TSLA), stock is up today, forget about General Motors,” said Carter Worth on CNBC.
General Motors Company (NYSE:GM) is on the hand facing a string of challenges at the back of a fire ripping through a factory in China that supplies it with wheels, killing at least 69 people. The giant automaker has now asked one of its suppliers to look for an alternative source of components. The automaker has also rubbished claims that it will be affected by the fire, reiterating it had enough inventory in stock.
Tesla on the other hand is not facing any immediate threats in the industry, the company’s ceo, Elon Musk has already said that the company is set to produce up to 60,000 vehicles in 2015, up from 35,000 this year. The CEO has also reiterated that production may be high based on the expected output of 2,000 vehicles per week from the Fremont, California plant.
Tesla Motors Inc. (NASDAQ:TSLA) Financial flexibility has already been demonstrated’ by the company announcing that it will finance 40% to 50% of the estimated $4 billion to $5 billion construction of the Gigafactory. The factory is set to produce cheaper and more efficient battery packs for future electric vehicles. General Motors has on the other hand started receiving claims on the damages that were caused’ by the faulty ignition-switch problems in some of its models.
General Motors Company (NYSE:GM) has also set aside $400 million that will be used to cover for the claims, an amount that may rise depending on the number of claims that get filed by the victims. Already a lawsuit has been filed in Manhattan Federal Court on behalf of more than 650 people allegedly injured or killed as a result of the faulty ignition switches.