Shares in electric vehicle maker Tesla opened a new tab that jumped nearly 12% before the bell on Thursday after it forecasted surging car sales growth and reassured investors that CEO Elon Musk was still looking to expand the core business of selling electric vehicles. The gains set the world’s most valuable automaker on course to add around $81 billion to its market capitalization if they hold when trading resumes. That would more than wipe out almost all of the year-to-date erosion on concerns that Tesla’s core EV sales were slowing and its new projects, like autonomous vehicles, may face long delays.
The company reported quarterly delivery and production figures that were in line with expectations and slightly above analysts’ estimates. Tesla also reassured investors that it was preparing to launch more affordable versions of its Model 3 and Model Y cars and would expand the availability of its “Tesla Network” ride-hailing service in the U.S. and Europe.
However, many investors’ more important focus was likely Tesla’s margins, which were squeezed by a price cut last quarter that helped drive higher deliveries. Analysts will be looking for signs of a bottoming on the margin metric when the company reports earnings later in the day, and CEO Musk is expected to emphasize this during the conference call.
Investors will also be watching to see whether Musk can provide details on how quickly the company can ramp up robotaxi production and clear inevitable regulatory hurdles. The company unveiled a two-seater driverless taxi this month at a flashy event. Still, it has yet to indicate how it will match the speed of rivals like Alphabet’s (GOOGL.O) Waymo, which operates uncrewed robotaxis ferrying paying passengers in a handful of U.S. cities.
Tesla’s earnings report also included a fuller picture of its operations and finances, including a $1.8 billion net loss in the third quarter. The company burned through cash and used a large amount of debt to fund its aggressive research and development efforts, including a project to produce reusable rocket fuel and a tunnel-digging machine that could potentially revolutionize how people commute.
