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Global EV adoption hits record high; What it means for Tesla stock

Global EV adoption hits record high; What it means for Tesla stock

Over the past decade, the electric vehicle (EV) industry has surged forward, emerging as one of the most rapidly expanding markets in the world. 

In 2011, global EV sales tallied approximately 55,000 units, but by 2021, that number had skyrocketed to nearly 7 million vehicles, showcasing the remarkable growth of the EV sector. 

Although many question this, this upward trajectory has continued into 2023. According to SEC-registered investment adviser, Gary Black, the global EV adoption reached a new record, surging to 11.8% in Q3 2023, up from 10.7% in Q2, and a substantial leap from 10.1% in 2022’s third quarter.

Global EV adoption in recent quarters. Source: Gary Black

“The MSM [mainstream media] narrative that EV adoption is suddenly stalling is nonsense.”

– Black wrote in his November 8 post on X.

That said, the Future Fund’s Managing Partner believes global EV adoption will hit 13% in the current fourth quarter, up from 11.2% in the same period last year. 

What does this mean for Tesla?

In his extensive X thread, Black also addressed the vital role of the EV industry’s biggest giant, Tesla (NASDAQ: TSLA), and its recent market share decline.

He said that the carmaker’s overall share in the global light EV market dipped in the third quarter due to its transition from Model 3 to Model 3 in China. The move left no inventory of the regular Model 3 in Europe and China, however, Black expects this to change in the fourth quarter as Tesla ramps up production and deliveries.

Furthermore, the long-awaited Cybertruck is expected to spark interest “in the entire TSLA franchise,” he noted. 

In his closing analysis, Black said Tesla’s EV share has been “relatively stable over the past few years” despite the emergence of a number of new EV models launched by market competitors. 

Looking ahead, the expert said he expects Tesla’s “EV share to stabilize at 16%-18% in 2024 with M-3 Highland, Cybertruck launch and related halo effect, and $7,500 EV credit going off invoice on 1/1.”

Tesla stock price analysis

At the time of writing on November 9, shares of Tesla were sitting at $222.11, nearly unchanged in the past 24 hours. 

The stock rose more than 4% over the past five sessions but remains down around 14.5% on the monthly chart as a result of its disappointing Q3 2023 earnings report.

TSLA 1-month stock price chart. Source: Finbold

In the event that Gary Black’s forecasts materialize and Tesla successfully expands its market share in 2024, coupled with a successful Cybertruck launch, the potential for increased sales and profitability could reignite investor enthusiasm. This scenario could pave the way for another substantial Tesla rally in the coming year. 

Conversely, falling short of these milestones may diminish investor interest in the stock.

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