Gene Munster Says Tesla's Cheaper Model Y Is Like Apple's iPhone Strategy—But Warns It May Cannibalize Sales
Gene Munster, co-founder of Deepwater Asset Management, believes Tesla's new affordable Model Y may cannibalize sales of the existing Model Y, similar to Apple's iPhone strategy. Following Tesla's earnings call, Munster expressed concerns about the impact on Tesla's lineup, a sentiment echoed by Gary Black of Future Fund LLC. Tesla's stock fell over 6% in pre-market trading due to weak revenue and sales. Despite plans for Robotaxis, challenges such as tariffs and the end of IRA incentives loom for Tesla.
Deepwater Asset Management's co-founder Gene Munster thinks the affordable Tesla Inc. TSLA Model Y trim level will cannibalize the existing Model Y.
Check out the current price of TSLA stock here.
What Happened: Following the company's earnings call on Wednesday, Munster took to the social media platform X to share his views on Musk's statement that the new affordable model would look the same as the current Model Y.
"I bet it uses the same body with scaled back features," Munster said in the post and drew comparisons with Apple Inc. AAPL, claiming that Tesla's plan was just like what the Cupertino-based tech giant "does with the iPhone."
Munster then expressed his concerns with the plan's possible effects on Tesla's existing lineup. "If it really looks just like the Y, it will cannibalize the Y. I have to think more about that trade off," he said.
Why It Matters: The news comes as Munster's opinion is shared by Future Fund LLC's managing director, Gary Black, who believes the new affordable trim level would add ‘no incremental volume' to Tesla.
However, the earnings call has had a negative impact on Tesla, with the company's stock declining over 6% during pre-market trading due to several factors, including weak revenue, dwindling sales and more.
While CEO Elon Musk has claimed Tesla plans to put enough Robotaxis to serve over half of the population of the U.S., there could be problems ahead for Tesla with tariff impacts and the Trump administration ending IRA incentives.
Tesla offers Satisfactory Momentum and Quality, while scoring well on the Growth metric, but offering poor Value. For more such insights, sign up for Benzinga Edge Stock Rankings today!
Check out more of Benzinga's Future Of Mobility coverage by following this link.
- Elon Musk’s Tesla Recorded ‘One Crash’ Every 6.69 Million Miles Driven, EV Maker Says Ahead Of Q2 Earnings
Photo courtesy: Brandon Woyshnis / Shutterstock.com
