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Analysts Bullish on Tesla's Fleet Truck Prospects

by Sam Chase
Last July, Elon Musk published a blog post on the Tesla website under the title "Master Plan, Part Deux." As its name indicates, the post is a sequel to the original Master Plan, written in 2006, which detailed how Tesla hoped to introduce a game-changing car and deliberately work to make it affordable and widely available over time.

As the $35,000 Model 3 is being delivered to customers, it's impressive to look back and see how on-track Tesla has been with its original gameplan. It also lends credence to "Part Deux," which discussed Tesla's plans for developing electric trucks.

"In addition to consumer vehicles, there are two other types of electric vehicle needed: heavy-duty trucks and high passenger-density urban transport," Musk wrote. "Both are in the early stages of development at Tesla and should be ready for unveiling next year. We believe the Tesla Semi will deliver a substantial reduction in the cost of cargo transport, while increasing safety and making it really fun to operate."

Since then, Musk has gone even further to stake Tesla's claim to the future of fleet trucks.

"Tesla Semi truck unveil set for September," he tweeted this past April. "Team has done an amazing job. Seriously next level."

While the old business adage urges that one ought to "underpromise and overdeliver," it's more of Musk's style to overpromise and then, somehow, clear the high bar that he sets for himself and his company.

With it now being September, Tesla has made no official announcement on when exactly -- or even if -- we'll indeed get a look at the prototype of the truck this month. Research analysts, however, see it as likely that the product will indeed be unveiled in the coming weeks.

"We expect Tesla's Electric Trucks to come soon, with SOP [start of production] in late 2018 based on plans to utilize slightly less vertical integration (Tesla does not see any reason to make their own Cabs or Gliders), and common sourcing with Tesla's light vehicles (uniquely possible for EVs)," analyst Rod Lache of Deutsche Bank wrote in a report on Tesla's fleet trucks published early this month.

At Morgan Stanley, analysts Ravi Shanker and Adam Jonas dove in even deeper to explain how the production of self-driving trucks may work for Tesla. Based on a detailed series of assumptions about the company's manufacturing capabilities, Shanker and Jonas estimate that Class 8 electric trucks represent a net value "of $5.1bn or roughly 8% of Tesla's current market cap."

The analysts also assert that the new product offering could ignite further interest in the company's stock. The analysts proposed the National American Vehicle Show, taking place in Atlanta on September 25, as a possible date at which the truck could be introduced.

As was revealed last month, Tesla has been in communications with the Nevada DMV about a permit to test long-haul trucks on the state's public roads. So not only will automobile enthusiasts hopefully see the Tesla trucks in a showroom later this month, but residents of the Copper State could very well see them on their roads in the near future.


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