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Tesla Cybertruck: Top 3 things investors need to know

The Tesla (TSLA) Cybertruck launch event took place on Thursday in Austin, Texas. Yahoo Finance spoke to experts across the industry to discuss all of the details from pricing to production. Here are the top three things you need to know.

1. Price (00:00:24)

Yahoo Finance's Brad Smith broke down the Cybertruck pricing for the three different modes. Smith said, "I think the pricing really caught a lot of people by surprise, considering that ... when they announced it in 2019 of what could potentially be mirroring perhaps an F-Series type purchase on the lower end, or at least mass market appeal for a truck in that same price range. This is not that. This is a luxury vehicle type of annexation that they've just slapped on with that type of price tag."

Ronald Jewsikow, Guggenheim Securities Vice President of Automotive Equity Research, broke down the pricing tiers and what it means for investors. Jewsikow said, "The pricing was a key debate coming in ... but ultimately the vehicles that are being delivered next year, $80,000 plus, is probably a much smaller market that what investors thought Tesla was initially attacking."

2. Demand (00:01:27)

Barron's Senior Writer Al Root discussed the uncertainty of what the market will be for the Cybertruck. Root said, "The Cyberbeast model starts at $100,000. That's not really a truck, that's sort of a luxury car. Pre-orders for these things, there's like a million pre-orders, but you only had to put a $100 down. It was fully refundable to get on the list. So we just don't know what demand will be like."

Tasha Keeney, ARK Invest Director of Investment Analysis & Institutional Strategies, remained optimistic regarding the demand for the Cybertruck. Keeney said, "Some people think this will be a niche vehicle platform. I don't think so ... I'd see more trouble for Ford (F) ahead as Cybertruck production rolls out."

3. Production (00:01:51)
"Wall Street expects about 1,500 of these to be delivered this year, 78,000 next year," Root said. "Tesla itself says we can't get to producing 250,000 a year on a run rate basis until at least 2025. So that's December 2025, they can make 40,000 of these a month."

Gerber Kawasaki Wealth & Investment Management President and CEO Ross Gerber thinks that the Cybertruck is an "enthusiast vehicle," but he does not believe that will deter sales. Gerber said, "I don't think it's hard to sell 250,000 of these a year if they can make them. I think the challenge is going to be actually making them, not selling them."

Video highlights:

00:00:03 - Yahoo Finance's Diane King Hall

00:00:24 - Yahoo Finance's Brad Smith

00:01:07 - Ronald Jewsikow, Guggenheim Securities Vice President of Automotive Equity Research

00:01:27 - Barron's Senior Writer Al Root on demand

00:01:37 - Tasha Keeney, ARK Invest Director of Investment Analysis & Institutional Strategies

00:01:51 - Barron's Senior Writer Al Root on production

00:02:14 - Gerber Kawasaki Wealth & Investment Management President and CEO Ross Gerber

Video Transcript

[MUSIC PLAYING]

JOSH LIPTON: Tesla will deliver its first production version of its Cybertruck to customers on Thursday in Austin, Texas. Ahead of the EV giant's first new vehicle in almost four years, here is everything you need to know. A starting price of $40,000 was announced back in 2019, with two higher performance models that would cost $50,000 and $60,000. However, those prices were removed from the Cybertruck website in 2021. And an official price has been difficult to find.

TOM NARAYAN: His goal is to make it affordable for regular folks. If you look at the pickup truck market in the US, the EV pickup truck, they're super expensive. So it's going to be challenging to make this thing profitable, given how technologically advanced it is.

JOSH LIPTON: Tesla received over 250,000 reservations for the Cybertruck within a week of its unveiling. The Cybertruck currently has over 1.5 million existing reservations.

TASHA KEENEY: Some people think this will be a niche vehicle platform. I don't think so. If I was Ford, they're already cutting the production shift at the F-150 Lightning plant in Detroit, you know, I'd see more trouble coming for them ahead as the Cybertruck rolls out.

JOSH LIPTON: Some specs were highly publicized, like shatter-resistant glass and a stainless steel exterior. The Cybertruck allegedly has a towing capacity of 11,000 pounds, 1,000 pounds more than Ford's F-150 Lightning, and 2,500 pounds of payload capacity. Although the Cybertruck's frunk, the nickname given to the extra storage space in the front of EVs where an engine would go, appears to be smaller than the F-150 Lightning.

Tesla CEO Elon Musk said during an October third quarter earnings call that we dug our own grave on the Cybertruck, warning that the production has been an enormous challenge. Tesla plans to deliver only 10 cybertrucks during its event on Thursday.

DAVID UNDERCOFFLER: I would be very surprised if the actual Cybertruck hit the road in the next year to 18 months and it had a starting price of anything lower than $60,000. I mean, that's an expensive proposition out of the gate.

[AUDIO LOGO]

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