Finance
Why Tesla shares soared higher today
Tesla (NASDAQ: TSLA) Shares may be having their best week since January last year, but investors aren’t taking any profits today. Shares of the electric vehicle (EV) leader soared higher on Monday following news last weekend that CEO Elon Musk took a surprise – and productive – trip to China.
Shares of Tesla rose after it was reported that Musk met with Chinese Premier Li Qiang, and the company received approval to continue operations. Full self-driving software technology (FSD). in its Chinese-built electric vehicles. The stock was up 12.3% as of 11:05 a.m. ET, bringing its gain since the start of last week to more than 30%.
One step closer to autonomous driving
Investors are reacting to reports that Musk’s trip resulted in approval for the company to roll out its FSD software in China and transfer data abroad. That’s a huge step for the American company as it competes with Chinese EV makers in the world’s largest auto market.
Tesla’s current version of FSD still requires 100% driver supervision. However, investors have been that way for a long time valuing Tesla stock based on its potential that its vehicles will one day be able to operate autonomously. Musk himself has said that operating a fleet of robotaxis is the company’s real value.
It should be noted that Tesla’s vehicles were not the only ones to receive approval from China’s data security regulations. Offers from other China-based EV makers joined Tesla’s Model 3 and Model Y in passing China’s data security rules.
But the victory for Tesla could lie in how it passes on the development of its technology to the other countries in which it operates. Today’s stock jump appears to anticipate these future potential developments. Regardless, it’s still a step in the right direction for Tesla, and investors are cheering the news.
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Howard Smith has positions in Tesla. The Motley Fool holds and recommends positions in Tesla. The Motley Fool has one disclosure policy.
Why Tesla shares soared higher today was originally published by The Motley Fool
