Tesla stock jumped as much as 5% on Tuesday even though there was no development directly related to the company. Instead, it was General Motors that made headlines for delivering its first Bolt electric cars in Tesla’s backyard. So why did Tesla’s stock jump?
What sparked Tesla’s surge?
In an email to Fortune, Benjamin Kallo, an analyst at Robert W. Baird, said the surge is seen as a reaction to a combination of factors. Apparently, investors reacted to the news of Google, one of Tesla’s main competitors, scaling back its own self-driving cars. Alphabet is still looking to share its self-driving tech with other automakers, however, says Fortune.
Tesla shares have been trading in an oversold region for the past 12 months, shedding 9% and leaving investors to hop on board, according to Kallo. The analyst maintains a Buy rating on the stock. Also oil prices rebounded since OPEC reported plans to cut down the supply gut in November. This could have also helped.
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Further, there were reports that Elon Musk will meet President-elect Donald Trump during the tech industry summit. This would have acted as another catalyst, according to Kallo.
Chevy starts delivering the Bolt
Meanwhile, General Motors has started delivering the Chevy Bolt, and the first one will be delivered to a customer who, coincidentally, lives in Tesla’s backyard. The Chevy Bolt is the first “affordable” electric vehicle that can travel more than 200 miles on a charge; it starts at $29,995 (after a $7,500 federal tax credit).
Though the Model S and Model X deliver a range of over 200 miles, they are much more expensive. However, Tesla is working on its own affordable vehicle, the Model 3. It is slated to begin shipping late next year, so those looking for a pocketbook-friendly option in electric vehicles have the Chevy Bolt as the only currently available option.
Bill Mattos, to whom the Chevy Bolt will be delivered, is a retired law enforcement officer. Mattos lives in Fremont, California, the same city in Bay Area where Tesla has its vehicle factory. Mattos has been driving a Chevy Spark EV and a second-gen Chevy Volt. Two other Chevy Bolts will be delivered in California to one customer who is switching from a BMW i3, and another one who owns a Toyota Prius.
Chevy gave no reply when asked by The Verge if the first delivery of the Bolt to Tesla’s neighborhood is a coincidence.
On Tuesday, Tesla shares closed up 2.97% at $198.15. The stock has a 52-week high of $269.34 and a 52-week low of $141.05.